The Danish District Heating Association has assigned us to analyze the impact of phasing out the use of biomass in district heating. We have explored three scenarios of phasing out, all by 2035. In the first scenario, a 50 percent reduction is implemented. In the second scenario, a 75 percent reduction is implemented. In the third scenario, the phasing out of the use of biomass is 100 percent complete.
The use of biomass is set to be replaced by heat pumps and electric boilers, fueled by electricity from solar and wind parks. Consequently, the electricity demand is set to increase. Simultaneously, the electricity production from the thermal plants is set to decrease. Therefore, the capacity of onshore wind and solar parks needs to increase correspondingly.
Our analysis focuses on answering three questions:
1. How big is the need for new capacities of heat pumps, electric boilers, and onshore wind and solar parks?
2. How big are the changes in yearly costs and what are the investment and sunk costs for the phase-out?
3. What will the phasing out mean for land use?
Cost-benefit
A key factor is the replacement of costly biomass with sun and wind. Also, the life expectancy of the technologies has an important impact on the results. Solar and wind parks have a life expectancy of 35 years while thermal plants have 25 years. Boilers and heat pumps have a life expectancy of 20 years.
Meanwhile, the electricity production of solar and wind parks is less efficient. Consequently, the capacity needs to be higher than the capacity of thermal plants. Yet, the operational costs of solar and wind parks, boilers, and heat pumps are significantly lower than those of thermal plants.
The land use differs considerably. Phasing out the use of biomass could lead to a reduction of more than 90 pct. Land prices thus have a considerable impact on the bottom line.
We are hosting and supervising PhD student Daniele Mosso for one year. Daniele Mosso is doing his PhD at Politecnico di Torino. He is focusing on developing tools to modelling the water-energy-food nexus. The objective is to answer the following question: To what extent can energy be produced without significantly harming natural resources and related sectors?
Daniele Mosso spent the initial period of his PhD examining the major factors affecting the sustainability of energy systems. He concluded that land use, or the consumption of natural resources, is a major issue.
Limitations of existing models
Meanwhile, the existing Energy System Optimization Models (ESOMs) have limitations concerning sustainability and environmental aspects. The limitations can be overcome in several ways. Based on his initial research, Daniele Mosso opted to develop a tool to represent the sectors of agriculture, forestry, and land use (AFOLU) in an ESOM. The tool should make it possible to account for land and water consumption and related emissions.
Subsequently, the research of Daniele Mosso is in line with a new research project Energy Modelling Lab launched recently. The aim is to develop a prototype module representing the AFOLU sector for the TIMES modelling framework. The TIMES model is an energy system optimization model.
Exploring a soft-linking methodology
Furthermore, Daniele Mosso plans to devote the last part of his PhD to exploring a soft-linking methodology. One possibility is direct coupling with an integrated assessment model (IAM) representing natural resources.
At Politecnico di Torino, Daniele Mosso is a member of the MAHTEP Group (Modeling of Advanced Heat Transfer and Energy Problems). It’s a research team established at the end of 2019.
Modelling
We will develop a prototype module representing the AFOLU sector for the TIMES modelling framework.
Scenarios
We will test scenarios of the impacts of energy consumption of the AFOLU sector.
Publication
The research is part of a PhD to be finalized in 2026.
We have launched a research project on the challenges of financing district heating projects. The overall objective is the development of sustainable financial frameworks for key district heating market types. Our focus is analyzing fundamental structures within district heating finance. One major result will be identifying best practices.
The project will provide authorities, investors, and the scientific community with fundamental insight into sustainable finance’s role in district heating deployment. District heating is key to the green energy transition in the EU. Since the sector is set to grow so is the need for financing.
The research project is entitled “Financial Frameworks’ Impact on District Heating”. We are implementing it as a party to a four-country consortium (Belgium, Denmark, Germany, and Sweden).
Challenges to district heating
District heating is a cost-effective and sustainable technology. Nonetheless, financing challenges pose a serious impediment to new projects. District heating projects are typically large-scale and require significant upfront investment. Therefore, it’s a difficult task to secure financing, particularly from the private sector.
Mainstream financing mechanisms to attract private capital are usually ill-suited for district heating. Subsequently, the development of district heating has historically relied heavily on public financing, such as grants, loans, and guarantees. In particular, this is the case in countries with a strong tradition of public ownership and control of energy infrastructure.
Objectives
1. To understand and define district heating as an asset class. We will classify the various investment components into an asset class structure according to the standards in the investor community. Investors tend to hold portfolios of assets of varying character. Identifying the asset class of district heating allows investors to lower the threshold for investing in it.
2. To establish a database of key financial characteristics.
3. To understand the impacts of financial frameworks on the deployment of district heating.
4. To provide recommendations on how investors in green energy can approach the district heating sector.
We are contributing to a project designating low-carbon solutions for Azerbaijan. The project result should be a Roadmap recommending relevant policies and technologies. The full title is “Low-Carbon Solutions in the Electric Power Sector of Azerbaijan Technical Assistance Project”.
Azerbaijan relies heavily on oil and gas, which has brought significant economic growth over the years. Oil, gas, and related petroleum products accounted for 91 percent of Azerbaijan’s total exports in 2022 and almost 48 percent of its GDP. Likewise, in 2021, natural gas dominated the electricity generation mix (94 percent). It was followed by hydropower (4.6 percent), waste and biomass incineration (0.7 percent), and solar and wind (0.5 percent).
Meanwhile, there is a vast potential for solar and wind power that investors have already begun to develop.
TIMES-Azerbaijan
Energy Modelling Lab carries out part of the energy systems modelling work for the project. Subsequently, we are updating and tailoring the TIMES-Azerbaijan model we have developed for the EU Commission in 2021. We are using the model to create three scenarios:
A Business As Usual (BAU) scenario reflects current and planned policies concerning low carbon penetration.
One scenario assumes high economic growth and targets carbon neutrality by 2050.
One scenario assumes low economic growth and targets carbon neutrality by 2050.
Stakeholder engagement
We have also been assigned to design and take charge of stakeholder engagement, consultation, and communications. The aim is to foster an understanding of the modelling approaches. The key stakeholders should reach and maintain agreement on scenario assumptions, and we should obtain the necessary feedback. The overall objective is to ensure the full capacity of ownership of the key stakeholders. Additionally, the Roadmap should be credible, robust, and functional.
Energy Modelling Lab has been subcontracted for the project by Tetra Tech. The project is implemented within the Memorandum of Understanding between the Ministry of Energy of Azerbaijan and the European Bank for Reconstruction and Development EBRD on technical support related to the development of the electric power sector of the Republic of Azerbaijan.
Modelling
We are updating and tailoring the TIMES-Azerbaijan model using the TIMES energy systems modelling framework.
Scenarios
We are creating a business as usual (BAU) scenario and two scenarios targeting net zero for the energy sector by 2050.
Stakeholder engagement
We are taking charge of designing the consultation and communications to ensure the full ownership of key stakeholders.
We have contributed to developing scenarios for CONCITO, a major Danish green think tank, and documented the work in the report “The Danish Bioresource”. CONCITO has analyzed the scenarios in the report The Importance of Agriculture for Future Land Use (Jordbrugets Betydning for Fremtidens Arealanvendelse), published in May 2024.
The scenarios represent different visions of land use in Denmark. The scenarios consider major concerns regarding sustainability, climate neutrality, and natural resources.
We have contributed to developing scenarios for CONCITO, a major Danish green think tank. CONCITO has analyzed the scenarios in the report The Importance of Agriculture for Future Land Use (Jordbrugets Betydning for Fremtidens Arealanvendelse), published in May 2024.
The scenarios represent different visions of land use in Denmark. The scenarios consider major concerns regarding sustainability, climate neutrality, and natural resources.
Consequently, the scenarios explore the potential of a substantial increase in plant-based food production and a corresponding livestock decrease. The impact of such measures on the economy and the well-being of the Danish population has also been explored.
The set target for the scenarios is to keep contributing to global food production on the present scale. The set target amounts to producing about 22 trillion kilojoules, feeding about 22 million people by 2050.
Bio-Resources of Denmark
We used the model for Denmark’s bioresources, DK-BioRes. Energy Modelling Lab developed this model for the Danish Energy Agency in 2021. We have updated and tailored the model to meet the needs of CONCITO. The model contains data on Denmark’s bioresources, i.e., agricultural land, forests, natural areas, and aquaculture.
The model and the data sources used are available on GitHub.
Based on the input on crop distribution, livestock, land distribution, and desired applied technologies that the model receives, it can analyze how biomass flows through a network of processes. The results include the final production, land use, and greenhouse gas emissions.
Potential pathways
The model can generate scenarios showing the pathway to a specific target. For the CONCITO scenarios, the set target is that the Danish agricultural sector keeps contributing to global food production on the present scale relative to the global population growth.
The scenarios generated show which kind and quantities of crops and livestock production could meet the target. They also show the land use needed. The non-edible bi-products such as straw are also included in the calculations of final material production.
In general, the focus of CONCITO in transforming the food system is to ensure sufficient healthy food in the least space possible with the least greenhouse gas emissions and negative impact on nature, the environment, and animal welfare.
During 2024, CONCITO is running the project Rethink Denmark with a special focus on land use.
Open-access model
The DK-BioRes model was developed under the program of the Bioenergy Taskforce. The model is calibrated to use 2019 as the base year. The data used are from Statistics Denmark. For the CONCITO scenarios, data on calories for edible products have been added to the model.
The DK-BioRes is built in Excel and is an open-access and open-source model. The model and the data sources used are available on GitHub.
Energy Model Lab has also developed a new and updated version of the DK-BioRes model, tailored to meet requirements from the Climate Council. We handed the model over to the Climate Council in March 2024.
Overview of the DK-BioRes model:
Documentation report
The documentation report on the scenarios, “The Danish Bio Ressource”, is available in Danish only.
The past year has been very active and productive as we show in our Newsletter 2023. We have created the TIMES-KUWAIT model and further developed the TIMES-Vietnam, TIMES-Jordan, and TIMES-NEU models. The latter covers Northern Europe. We have also embarked on several research projects. One focuses on PtX, another on modelling the AFOLU sector. A third project is focusing on supporting local authorities to speed up the green transition.
Inspired by community
We were pleased to attend the Semi-annual ETSAP meeting in Turin in November. Our consultant Till Ben Brahim made a presentation on the possibility for the Nordic countries, especially Denmark, to become a green hub for the export of green hydrogen and electricity to Europe. He showed scenarios generated by the TIMES-NEU model that we have used to analyze future energy markets in the Nordics.
Furthermore, we had the opportunity to network and agree with colleagues from Italy, Belgium, and the Nordic countries to team up regularly and share results from our work.
Creating the TIMES-KUWAIT model
We have contributed to the first steps of strategic energy planning in Kuwait as consultants on the project Developing Kuwait’s Long-Term Climate Pathways. In the first place, we developed a database for energy and GHG emissions. Next, we created the TIMES-KUWAIT model and generated different scenarios including rapid expansion of the renewable fuel market and reduced exports.
The government of Kuwait has pledged to reach net-zero emissions in the oil and gas sector by 2050 and by 2060 for the whole country.
Best location of PtXplants
As part of MissionGreenFuels, EML is collaborating with 13 partners on the PtX Sector Coupling and Life Cycle Assessment Project. The expected result is to create better ways to determine optimal ways of integrating PtX into the green transition. To this end, we are developing and updating the TIMES-NEU model.
The study aims to identify the policy instruments needed to accelerate the uptake of hydrogen fuel cells for the shipping industries in Denmark, Norway, and Sweden.
Hydrogen fuel cells are promising for reducing emissions from shipping. However, their adoption is limited by high costs, lack of regulations, and lack of infrastructure. This is why there is a need for policies that spur investments in hydrogen fuel cells.
The three policy packages
Together with our fellow researchers, we tested three policy packages with different degrees of ambition (low, medium, and high). Our findings indicated that the proposed taxes on CO2 emissions and fossil fuels can help drive the transition away from fossil fuels. Meanwhile, the complete transition requires a ban on the use of fossil fuels.
The three policy packages were formulated based on discussions during workshops with key stakeholders from Nordic Shipping. During the workshops, we also learned that the participants are paying high attention to a “chicken and egg” paradox: Without the demand for green hydrogen, no supply, and vice versa. This has not been reflected in previous studies.
Correspondingly, a coordinated regional approach and cross-sector and cross-industry collaboration are needed. Otherwise, we cannot overcome the paradox and help balance the supply and demand for Nordic shipping
Modelling
MODEL
We used the TIMES-NEU model, an economic model generator for energy systems, to evaluate the three different policy packages. EML has developed the TIMES-NEU model.
SCENARIOS
Estimated total fuel consumption in PJ/year; CO2 emissions by fuel in thousand tons of CO2 emissions/year; revenue from the tax on fossil fuels in million Euros/year; ferry segment fuel consumption in PJ/year.
RESULTS
The main finding was that policies are needed to spur investments. Meanwhile, it’s necessary to ban fossil fuels to complete the green transition of shipping.
Other scenarios included in the study show estimated CAPEX and OPEX in million Euros/year, estimated CAPEX and OPEX for the ferry segment in million, and estimated CAPEX and OPEX of the mandate of ferries to use hydrogen in comparison to the policy packages in million Euros/year.
The television program 21 Sunday focused on the production of green fuels for shipping in the edition broadcasted on DR on 11 February. Energy Modeling Lab has made the calculations on which DR bases the main point of the broadcast: It is a huge challenge to build up the production of green fuels and establish the supply lines for green shipping.
DR used Ane Mærsk as an example. It is a brand-new container ship that can sail on green methanol. To make enough green methanol for Ane Mærsk to sail for a year, electricity must be used from a solar park the size of the one in Kassø in Southern Jutland. This is what our calculations show. The solar park in Kassø is the largest in Northern Europe.
Maersk’s goal is that 25 percent of the company’s fleet must sail on green fuels in 2030. If it sails on green methanol, and the power is to be supplied from solar parks in Denmark, it will require approximately 120 parks of the same size as Kassø.
We have used the Danish Energy Agency’s technology catalog as the basis for our calculations. The catalog shows how much power different technologies can be assumed to produce calculated on average.
All our calculations
All our calculations can be studied closely in the Excel sheet
We have calculated the needed area use for six different types of green fuel production:
First generation biofuel
Second generation biofuel
A mixture of first- and second-generation biofuel
Solar plants in Denmark
Solar plants in Morocco
Wind farms in the North Sea
We show the needed area use as percentages of the following areas:
Denmark, Falster, Langeland, Horns Rev3, Morocco, Denmark’s agricultural area, Bhadla Solar Park (one of the world’s largest solar parks located in India), the Amazon, and soccer fields.
We have calculated the needed area use to produce green fuel for Ane Mærsk, 25 percent of Maersk’s fleet, 100 percent of Maersk’s fleet, and 100 percent of international shipping.
Solar parks in Morocco
We do not expect large-scale production of green methanol on solar energy will be built up in Denmark. Solar parks are more efficient further south. Therefore, we have also calculated how large an area would be required if solar parks were to be built in Morocco: In Morocco, a 254-hectare solar park would be needed to produce enough electricity for Ane Mærsk. The facility in Kassø occupies 326 hectares.
To supply 25 percent of Mærsk’s fleet with green methanol, the size of the needed solar parks if built in Morocco, corresponds to 60 percent of Falster’s area. It is Maersk’s goal that the company’s entire fleet sail on green fuels by 2040. This will require solar parks in an area equivalent to two and a half times Falster’s (247 percent) if they are indeed built in Morocco.
If we take the area of one of the world’s largest solar parks, namely Bhadla Solar Park in India, Maersk will need the production of electricity from 22 parks of Bhadla’s size. Bhadla Solar Park covers an area of 5700 hectares.
If all international shipping is to sail on green methanol, electricity equivalent to the output of almost 740 solar parks of Bhadla’s size must be produced.
Supply from offshore wind turbines
If all international shipping is to sail on green methanol, it will require as much power as approximately 3290 offshore wind farms can produce. This calculation assumes that the offshore wind farm has the same size and performance as Horns Rev3 in the North Sea. We have chosen to use Horns Rev3 in the North Sea as an example because it is one of the world’s most efficient wind farms.
Green methanol from biofuels
Until now, green fuels have primarily been produced from plants such as corn, soybeans, and rapeseed. It is called first-generation biofuel. Maersk opts out of using that type of fuel. If all international shipping were to sail on first-generation biofuel produced from soybeans, an area the size of more than half of the Amazon would have to be harvested every year.
It is also possible to use residual products such as soy straw to make biofuel. It is referred to as second-generation biofuel.
If Maersk’s entire fleet were to sail on second-generation biofuel produced from soy straw, an area equivalent to more than twice the area of Denmark would have to be harvested every year. If the entire world’s fleet were to sail on this type of biofuel, an area equivalent to almost 74 times the area of Denmark would have to be harvested.
DR’s program 21 Søndag satte fokus på den grønne skibsfarts behov for brændstof i udsendelsen bragt den 11. februar. Energy Modelling Lab har udarbejdet de beregninger, som DR bygger udsendelsens hovedpointe på: Det er en kæmpe udfordring at opbygge produktionen af grønne brændstoffer og etablere forsyningslinjerne til den grønne skibsfart.
DR brugte Ane Mærsk som eksempel. Det er et spritnyt containerskib, der kan sejle på grøn metanol. For at lave grøn metanol nok til, at Ane Mærsk kan sejle i et år, skal der bruges strøm fra en solcellepark på størrelse med den i Kassø i Sønderjylland. Det viser vores beregninger. Solcelleparken i Kassø er Nordeuropas største.
Mærsk har som mål, at 25 pct. af virksomhedens flåde skal sejle på grønt brændstof i 2030. Hvis den sejler på grøn metanol, og strømmen skal leveres fra solcelleparker i Danmark, vil det kræve omtrent 120 parker af samme størrelse som Kassø.
Vi har anvendt Energistyrelsens teknologi katalog som grundlag for vores beregninger. Kataloget viser, hvor meget strøm forskellige teknologier kan antages at producere beregnet ud fra gennemsnit.
Alle vores beregninger
Alle vores beregninger kan nærstuderes i Excel arket:
Vi har beregnet areal-forbruget for seks forskellige former for produktion af grønt brændstof:
Første generation biobrændstof
Anden generation biobrændstof
Blanding af første og anden generation biobrændstof
Solcelleanlæg i Danmark
Solcelleanlæg i Marokko
Vindmølleparker i Nordsøen
Vi viser areal-forbruget som procentdele af følgende arealer:
Danmark, Falster, Langeland, Horns Rev3, Marokko, Danmarks landbrugsareal, Bhadla Solar Park (en af verdens største solcelleparker, som ligger i Indien), Amazonas og fodboldbaner.
Vi har beregnet areal-forbruget til produktion af grønt brændstof for henholdsvis Ane Mærsk, 25 pct. af Mærsk’ flåde, 100 pct. af Mærsk’ flåde og 100 pct. af den internationale skibsfart.
Solcelleparker i Marokko
I virkelighedens verden bliver det ikke i Danmark, at man opfører solcelleparker i stor skala til produktion af grøn metanol. Solcelleparker er mere effektive længere syd på. Derfor har vi også beregnet hvor stort et areal, der vil kræves, hvis man opfører solcelleparker i Marokko: I Marokko skal man bruge en 254 hektar stor solcellepark til at producere nok strøm til Ane Mærsk. Anlægget i Kassø fylder 326 hektar.
Til at forsyne 25 pct. af Mærsk’ flåde med grøn metanol, skal man opføre solcelleparker i Marokko, der svarer til 60 procent af Falsters areal. Det er målet for Mærsk, at hele virksomhedens flåde sejler på grønne brændstoffer i 2040. Det vil kræve solcelleparker på et areal svarende til to og en halv gang Falsters (247 pct.), hvis de vel og mærke opføres i Marokko.
Hvis vi tager arealet på en af verdens største solcelle-parker, nemlig Bhadla Solar Park i Indien, så får Mærsk brug for produktionen af strøm fra 22 parker af Bhadla’s størrelse. Bhadla Solar Park dækker et areal på 5700 hektar.
Hvis hele den internationale skibsfart skal sejle på grøn metanol, skal der produceres strøm svarende til knap 740 solcelleparker af Bhadla’s størrelse.
Forsyning fra havvindmøller
Hvis hele den internationale skibsfart skal sejle på grøn metanol, vil det kræve lige så meget strøm, som omtrent 3290 havvindmølleparker kan producere. Denne beregning har som forudsætning, at havvindmølleparken har samme størrelse og ydeevne som Horns Rev3 i Nordsøen. Vi har valgt at bruge Horns Rev3 i Nordsøen, fordi det er en af verdens mest effektive vindmølleparker.
Grøn metanol fra biobrændstoffer
Hidtil har grønne brændstoffer primært være produceret på planter som majs, sojabønner og raps. Det kaldes for første generation biobrændstof. Mærsk fravælger at bruge den type brændstof. Hvis hele den internationale skibsfart skulle sejle på første generation biobrændstof fremstillet på sojabønner, skulle man hvert år høste et areal på størrelse med mere end halvdelen af Amazonas.
Det er også muligt at bruge restprodukter som sojahalm til at lave biobrændstof. Det betegnes som anden generation biobrændstof.
Hvis hele Mærsk’ flåde skulle sejle på anden generations biobrændstof fremstillet på sojahalm, skulle man hvert år høste fra et areal svarende til mere end det dobbelte af Danmarks areal. Hvis hele verdens flåde skulle sejle på denne type biobrændstof, skulle man høste på et areal svarende til næsten 74 gange Danmarks areal.
