Global Insights: 24th April 2018

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on Apr 24, 18 • posted by

Global Insights: 24th April 2018


National Energy Guarantee moves to next stage of the design process

The COAG Energy Council met on Friday with one of the main points of discussion being the high-level design of the new National Energy Guarantee (NEG).  The NEG contains a Reliability Guarantee and Emissions Guarantee and the document released on Friday gives a high-level view of the how the National Energy Market (NEM) will meet the guarantee requirements.  It does not include what the Emissions Guarantee target will be but it does set out the detail of the reliability requirement.

There has been criticism of the NEG, with one commentator stating that state-based policies will be able to meet the Paris Agreement Targets without the need for the NEG. There is concern that the NEG could actually inhibit these state targets.

AEMC release directions paper to link to the NEG Reliability Guarantee

The AEMC are considering changes to the regulatory framework to assist in the reliability of the electricity system and ensure that this reliability is met with least cost to consumers.  The consultation paper is following recommendations made by the Finkel review and to link to the NEG.  The review recognised the changing generation mix within the NEM.  This change from predominantly fossil-fuelled centralised generation to one with more renewable and distributed generation sources would need changes to the market design. The consultation document is seeking views on (1) demand response, (2) forecasting demand for electricity, (3) day-ahead markets and (4) strategic reserve.


California has a fundamental legislative decision on CCAs coming up

Following on from a CPUC report into the importance of Community Choice Aggregators, the CCA movement has got to the stage where a major regulatory decision is to be taken about how locally developed, often cheaper, renewables can be paid for. The IOUs have put forward their idea to the CPUC by April the 2, as has CalCCA – the organisation that represents the CCAs. It all comes down to whether a new Power Charge Indifference Adjustment (PCIA) will be agreed to. The PCIA is a bill charge that compensates IOUs for generation procured in the past at what are now above-market prices to meet anticipated electricity demand being lost to CCAs. If a change is allowed then CCAs are expected to develop faster taking yet more generation away from the IOUs.

American Wind Energy Association 2017 report

New Mexico leads the way for wind deployment in 2017 in the US.

NY increases electricity sensors

The N.Y. Power Authority has announced another  $9 Million for Deployment of equipment sensors to further transform statewide power system into State-of-the-Art digital network. The sensor program builds on Governor Cuomo’s opening in December 2017 of NYPA’s Integrated Smart Operations Center (ISOC), a cutting-edge digitized power asset monitoring and diagnostic center at NYPA’s headquarters in White Plains.

As part of the sensor deployment program, NYPA will install sensors on equipment throughout its statewide network of 16 power plants and 1,400 miles of transmission lines, including on such equipment as transformers, reactors, turbines, generators, breakers, battery banks, cables, and capacitors. NYPA already has sensors feeding approximately 26,000 points of data to the ISOC from across its power system. With the addition of 50,000 sensors installed through this robust, new sensor deployment program, NYPA aims to have a total of 75,000 points of data or more feeding into the ISOC by the conclusion of this program.


Vattenfall’s EV charging ambitions

Swedish utility Vattenfall is setting up a new business unit with the aim of building on its existing activities in EV charging to become the leading charging infrastructure in northwest Europe. The company already operates 8,800 charging points in networks in Sweden, Germany and the Netherlands. Its new E-mobility business will extend offers ranging across home, business and public charging into new markets, including the UK, France and Norway.

Energy efficiency target assumptions questioned

A key part of the new clean energy package for Europe is a new 2030 energy efficiency target. Negotiations between the European Parliament, Member States and the Commission have been going on for some time about the level of ambition. The Commission originally proposed a 30% increase in efficiency, which the Member States endorsed, the Parliament agreed on a 35% increase after much debate. Now, a new study from the European Council for an Energy Efficient Economy (ECEEE) has questioned the basis of calculations by the Commission in the initial proposals. Specifically, the ECEEE argues that the 10% discount rate used by the Commission was too high, as the average rate for buildings in Member States is 5.7%. Adopting this lower rate as an assumption would mean lower costs for efficiency measures and space for higher targets and annual savings. The Commission has defended its approach as ‘robust and analytically sound’, but the Institutional Investors Group on Climate Change have called on Member States to adopt the 35% target, arguing that the Commission assumed ‘unrealistically high investment costs’. Negotiations on the targets continue this week in Sofia.

Offshore wind islands

The Netherlands recently announced a new 11.5 GW Offshore Wind Energy Roadmap to 2030 that includes placing turbines on constructed offshore islands. The Dutch grid operator TenneT Holding BV is seeking to build an island in the IJmuiden Far Offshore zone. The idea is that such islands would not only facilitate connections to more than one country but also serve as the base for operations to convert electricity into hydrogen. The Dutch plans may be a step on the road towards a much more ambitious vision for a 30GW Wind Power Hub island on Dogger Bank that could connect to Norway, the UK, Denmark, Germany, Belgium and the Netherlands, also promoted by TenneT in association with Denmark’s TSO Energinet. Of course, the idea of multi-country offshore wind connections in the North Sea has been around for some time, and the experience of the North Sea Countries’ Offshore Grid Initiative suggests that delivery is a lot harder than vision. The recent fall in offshore wind costs will help, but Brexit may prove an additional barrier.

Green technology accounts for 15 percent of German economic output 

Green technologies accounted for 15 per cent of Germany’s gross domestic product (GDP) in 2016 and are set to increase to 19% by 2025 according to the Environment Ministry’s (BMU) new ‘GreenTech Atlas’. Launching the Atlas environment minister Svenja Schulze said that ‘GreenTech Made in Germany is increasingly turning into a modernisation boost for our economy’.

German financial support for renewables could end in a few years’ time

The Germany’s Minister for Economic Affairs and Energy, Peter Altmaier, has said that the renewable energy sector will be competitive without financial support within the next four to five years. Speaking at the sidelines of the Berlin Energy Transition Dialogue he highlighted that development costs for onshore wind have halved and stressed that he wanted to accelerate planning permission for new power lines.

Climate action must not be elite project – German environment minister

Climate action ‘must not be a project for the elites’ and policymakers had to ensure that the necessary changes such as an exit from coal-fired power does not leave whole regions behind, said German environment minister Svenja Schulze at the opening of the second day of the Berlin Energy Transition Dialogue. Schulze named four key guidelines for decision makers in achieving the Paris Agreement: (1) Climate protection had to be coherent. The gap between international climate targets and greenhouse gas trends has to be closed by regularly examining and raising the ambition of the Nationally Determined Contributions. (2) Politicians needed to send ‘reliable and long-term signals’ to gain the trust of citizens and investors. (3) Government and business investments need to be better streamlined with climate protection, which ultimately was a ‘driver of innovation and jobs’. (4) Politicians have to responsibly ‘steer’ the transformation to a decarbonised economy to ensure no groups or regions are left behind.

Governments must bridge payback time of key efficiency investment – IEA’s Birol

The head of the International Energy Agency, Fatih Birol has said that Government’s across the globe must bridge the gap between investments in energy efficiency and their payback in order to achieve climate change targets. Birol stressed that progress is urgently needed on energy efficiency but despite lifetime savings outweighing investment costs ‘Industrialists and consumers are impatient’ and bridging this payback gap was ‘the role for the governments’. 


Last week saw the Berlin Energy Transition Dialogue, with representatives from 90 countries worldwide coming together to discuss energy system transformation.  A short blog of the event and links to reports released can be found here.

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