Energy Modelling Lab has made an analysis of the future energy market in Northern Europe that will develop pursuant to the green transition. The analysis was an assignment from COWI. It has been used as a reference in the report Roadmap to a future, Danish hydrogen infrastructure, published by the CIP Foundation in May 2023.
The analysis focuses on Denmark, Norway, Sweden, Germany, Poland, Holland, Belgium, and UK. It probes on the potential future markets of energy and fuels including PtX fuels from now on and until 2050.
Based on data from the Danish Energy Agency, the Danish production of electricity is expected to increase by almost 900 % by 2050. The increase is primarily due to offshore wind parks. It’s assumed that the offshore wind parks will be established in connection with planned “energy-islands”; two to three in the North Sea and one in the Baltic Sea. Also, there are plans to establish electrolysis facilities and we assume they will be established on the energy-islands.
Domestic demand
Domestic demand for electricity is expected to remain almost constant due to energy saving measures. But the overall expected increase could be about sevenfold from now on and until 2050, due to the planned expansion of PtX facilities. The bulk of the potential electricity production would thus be used for production of hydrogen for export. Denmark could potentially produce one third of the total hydrogen produced in the area, that our analysis covers.
The demand for hydrogen in Northern Europe is estimated to grow dramatically. According to the prognosis in the analysis, Holland, Belgium, and Germany will be the main purchasers. The estimated value of the potential, Danish hydrogen export is 100 billion DKK pr. year.
Germany or Sweden
The prognosis is based on the assumption, that Germany’s capacity of hydrogen production will remain rather limited. This assumption relies on calculations showing that Danish offshore wind parks will produce slightly cheaper electricity than German facilities. Meanwhile, the likelihood that Germany will establish a largescale production remains high.
An alternative scenario not included in the published analysis showed that Sweden could become the main purchaser of Danish produced hydrogen by 2050. This is mainly due to calculations showing that production costs in Sweden are higher than in Denmark.
Energy Modelling Labs has updated the TIMES energy system model for the analysis. The TIMES model is internationally recognized and used by IEA and the Danish Energy Agency. We developed it further to cover Northern Europe which resulted in developing the TIMES-NEU.
MODELLING
Energy Modelling Lab has updated the Open Nordic TIMES model (ON-TIMES) and developed it further to the Northern Europe TIMES model (TIMES-NEU).
SCENARIO ANALYSIS
Energy Modelling Lab has probed on the future energy market that will develop pursuant to the Green Deal on climate neutrality by 2050.
RESULTS
Results and scenarios are collected in the report mentioned above.
Duration: 2022-2023
EML Team: Kenneth Karlsson
Client: COWI
Collaborators: Brinckmann
Model: TIMES-NEU
Report: Baggrundsnotat – Analyse af efterspørgsel efter PtX produkter