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Innovation race in electric mobility: solar cars, electric planes, vehicle-to-grid projects

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ENERGY WATCH #3 - November 13, 2018

Innovation race in electric mobility: solar cars, electric planes, vehicle-to-grid projects

by Karel Beckman

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Biomega's SIN electric car

While nuclear power is struggling, developments – and innovations – in electric mobility keep on racing ahead, as we note in almost every issue of Energy Post Weekly.

Steve Hanley reports on CleanTechnica that Danish bicycle maker Biomega has just introduced the SIN 4-passenger electric car in Singapore.

The SIN “is intended strictly for the congestion that is commonplace in Singapore and other large world cities. The company plans to bring it to market no later than 2023.”

The SIN is constructed of what the company calls “modular carbon fiber” developed with partners in Germany and the UK. It weighs 950 kilograms including the batteries, seats four people, has four wheel steering, and four electric motors with a total of 80 horsepower, according to DesignBoom. Its range is said to be 160 kilometers from two batteries — a 14 kWh fixed battery and a 6 kWh battery that can be removed for easy charging.

“Biomega adheres to the less-is-more approach of Scandinavian design standards. Through the resulting uncluttered interior, the car rejects superfluous styling in favor of low cost, comfort and sustainability,” the company says. It sees the SIN as being ideal for ride-sharing and ride-hailing services in crowded urban areas.

Biomega says the SIN will sell for around $23,000. Hanley notes that this “is exactly the price Volkswagen says its entry level electric car based on its new MEB chassis will cost. Presumably, Volkswagen expects that car to come with such amenities as doors, windshield wipers, cup holders, and the other accoutrements real car buyers are accustomed to having in their cars.” In other words, the SIN will probably need to be significantly cheaper if it is to become a success, Hanley suggests.

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And there is more innovation going on in the electric mobility space.

The website The Driven reports that Hyundai and Kia cars may be powered by solar roof tech by 2019.

“South Korean carmakers Hyundai Motor and Kia Motors are going one better than creating an EV charging network powered by solar energy – they want their cars to capture their own energy, via solar roof technology – and as soon as next year”, writes The Driven.

There will be three types of solar cells applied to the cars. The first could recharge a car’s battery by up to 30 to 60 per cent each day, potentially adding range without a stop at a charging station.

A second-gen semi-transparent system is also being launched, that would act as a “sun roof” – in more ways than one – and also a third-gen version that can be applied to the car bodies.

The solar panels would be compatible with not only hybrid and electric vehicles but also pure internal combustion cars, Hyundai stated in a press release.

Jeong-Gil Park, executive vice president of engineering design at Hyundai says the technology will elevate the role of the EV driver from just another consumer of centrally generated power.

“This will enable them to develop from a passive device that consumes energy to a solution that actively generates energy. The paradigm of the vehicle owner will shift from that of a consumer to an energy prosumer,” Park said in a statement.

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Progress also continues to be made in electric planes.

Israeli-based electric aircraft maker Eviation is building the first of its all-electric passenger aircraft, called Alice, in France, The Driven reports.

The all-electric aircraft will carry up to 9 passengers, have a range of up to 1,000kms, and allow air travel providers to offer flights between regional centres, rather than through a central, city hub.

APAC business development lead Ron Hoffman gave a briefing about the proposal on Friday at the Australian Electric Vehicle Association conference in Brisbane. He says the maintenance and power costs of Alice’s emissions-free engine (presuming it’s charged with renewables) are around 30 per cent of conventional aircraft, which can cost $300 per flight hour for aviation fuel and $200 per flight hour for maintenance.

“The price will be comparable to a train and faster than driving [for] hours in a car,” Hoffman tells The Driven. “The interesting prospect is that there is a whole, new bigger network that was never dreamt before as commercially viable.”

Carrying a 900kWh li-ion energy pack, Alice will be able to travel much further than other electric aircraft being developed, such as air taxis like Kitty Hawk’s Cora, which is being tested in New Zealand and can fly up to 100km per flight, notes The Driven.

With Alice’s 1000km range, “new connections and new networks … suddenly make sense,” says Hoffman.

Eviation’s all-electric Alice airplane

Additionally, because Alice has no engine noise, there is the possibility of being able to open up discount flight options in the curfew hours between 11pm and 5am.

With the first batch of aircraft already under production in France, Eviation plan to introduce Alice at the Paris Air Show next year, writes The Driven. After the air show, Eviation will take Alice to the US, where it will go through an FAA certification process to fly in US airspace.

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In the U.S. work is continuing on the development of a “powerful new battery that could give us electric planes that don’t pollute”, reports James Temple on MIT Technology Review.

Materials science professor Yet-Ming Chiang (MIT) and mechanical engineering professor Venkat Viswanathan (Carnegie Mellon) are trying to develop a battery that will enable electric planes to get off the ground. They are “taking a different approach … altering not the composition of the batteries but the alignment of the compounds within them. By applying magnetic forces to straighten the tortuous path that lithium ions navigate through the electrodes, the scientists believe, they could significantly boost the rate at which the device discharges electricity.”

That shot of power could open up a use that has long eluded batteries: meeting the huge demands of a passenger aircraft at liftoff, writes Temple. If it works as hoped, it would enable regional commuter flights that don’t burn fuel or produce direct climate emissions.

Viswanathan and Chiang are collaborating with 24M, a lithium-ion battery manufacturer Chiang cofounded in 2010, and Zunum Aero, an aircraft startup based in Bothell, Washington, to develop and test prototype batteries specifically designed for the needs of an advanced hybrid plane.

The article explains the research project in some details, but ends on some cautious remarks. It quotes

Richard Anderson, an aerospace engineer and director of Embry-Riddle Aeronautical University’s Eagle Flight Research Center, who points out that “batteries are at least 20 times heavier than fuel for a given amount of energy output. He is skeptical that companies pursuing hybrid commuter flights, like Zunum, can find enough ways to offset that added weight in the next few years. He also thinks the field is overestimating how quickly hybrid planes will be able to reach longer distances—while underestimating the regulatory challenges they’ll face.”

Indeed, the MIT and Carnegie researchers themselves “are quick to say that other big battery improvements will still be required to extend the range of electric planes, which may necessitate a shift to entirely different chemistries. On top of that, planes will probably need to be fundamentally redesigned to reduce energy demands, potentially by redistributing motors or changing the shape of the body to reduce drag, Viswanathan says.”

But he and Chiang are working to develop a technical capability that would be required regardless of any other advances, he says. “Even if other battery engineers find ways to make electric planes to fly a thousand miles, they’ll still need enough power to get off the ground.”

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Another important type of innovation is to be found in vehicle-to-grid technology (V2G), which promises to turn EV drivers into power generators and to integrate EVs into the electricity system.

How far has this technology advanced by now? UK consultancy Everoze recently produced an overview of 50 V2G projects going on in the world. The report, commissioned by UK Power Networks and Innovate UK, draws the following “lessons learned” from what it calls its V2G Global Roadtrip:

  • Vehicle-to-Grid is commercially viable: the Parker Project in Denmark has for the last two years been providing a commercial ‘frequency response’ service to the Danish equivalent of National Grid. This service requires the ability to respond to a grid signal within 2 seconds and is on call 24/7. In the US and UK market, businesses will soon have access to commercial offers that use V2G to reduce the costs of EV ownership.
  • Vehicle-to-Grid can offer unique value over and above smart charging: V2G is particularly useful when i) combined with excess solar capacity, allowing households and businesses to increase their own self-consumption of on-site renewables, ii) where there are high peak prices or time of use charges iii) where longer duration services are required.
  • Industry needs to reduce the cost and expand the range of the hardware (chargers and vehicles) while refining the offer to customers, in order to unlock mainstream potential. In parallel network operators need to simplify grid connection standards and design service specifications with V2G in mind.

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Although much of the EV revolution is yet to happen, sales of EVs in Europe are continuing to rise. According to new data from the European Automobile Manufacturers Association, released on 8 November, in the third quarter of 2018 “demand for alternatively-powered cars in the European Union continued to post strong growth (+29.7%), mostly driven by the strong performance of battery (+37.4%), hybrid (+37.1%) and plug-in hybrid electric vehicles (+24.5%). Demand for LPG and NGV vehicles also increased – up 11.8% in the third quarter of the year – supported by growth of both natural gas and propane-fuelled cars.”

Demand for alternatively-powered vehicles significantly increased in all the major EU markets, notes the EAMA. APV registrations saw the highest percentage gains in Spain (+62.5%) – thanks to a notable uplift in the LPG and NGV segments – and Germany (+51.4%).

Sales of petrol cars also rose – by 15% – notes the EAMA. Demand for diesel cars on the other hand went down by 18%.

For an overview of European EV markets and polices, see this recent article on Automotive News Europe.

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Redefining the future of transport – and of energy

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ENERGY WATCH #1 - October 30, 2018

Redefining the future of transport – and of energy

by Karel Beckman

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Volkswagen CEO Herbert Diess promises to overtake Tesla

The news from the EV and battery front continues to be mind-blowing. The repercussions for the energy sector, especially oil, will be fundamental.

Against all expectations, Tesla produced highly positive third-quarter results, which convinced even the greatest skeptics that EVs are the future.

“Musk hails breakthough quarter as Tesla redefines future of transport”, summarized Giles Parkinson on Reneweconomy.com.

“Tesla delivered a profit per share (US2.90/share) where most analysts were expecting a loss. It posted free cashflow of $US881million, ending years of outflows. It produced as many cars (84,000) as it did in the whole of 2016, and produced higher than expected margins (more than 20 per cent) on its “mainstream” Model 3.”

Investment bank Macquarie hailed the Tesla results “as a major turning point, and Bloomberg analysts said the result “blew away” expectations.”

Elon Musk in his turn “pointed to a new future for road transport and shared mobility, and highlighted just how far the company was ahead of its rivals”.

Tesla says it will begin deliveries of the Model 3 to China and Europe early next year, and hopes to have lowered the cost of production enough to make it possible to profitably produce the promised $US35,000 version of the Model 3 within six months.

Musk also spoke of the new models that are on the way: “He has approved a prototype of the Model Y (a crossover SUV) and production will begin in 2020. The Tesla semi is moving forward, and he is particularly excited by the Tesla pick-up (ute).”

Musk talked of “shared electric and autonomous future, where ride hailing and shared cars will become the norm, just like Uber, Lyft and AirBNB. He imagines a Tesla fleet augmented by privately owned Tesla EVs that will provide a pool of shared vehicles.”

“I do know for sure that Tesla will operate its own ride hailing service, and compete with Uber and Lift directly,” Musk said in the earnings conference call. “We will be able to allow customers to add or subtract their car to the (company) fleet at will. Any customer will be able to share their car.”

Musk said Tesla is now far ahead of other car manufacturers. “Tesla is valued at more than $US50 billion, comparable with the biggest US car-makers even though it still makes just a fraction of their production.

But in the categories it competes in, it is riding high. Tesla says the Model 3 is now the number 1 car in terms of sales revenue in the US, and number 5 in unit numbers. Tesla is beating the BMW 3 in Germany, and is more advanced than any other car maker in EVs.”

Musk noted that the Model 3 delivers the most efficiency per kilometre and the lowest cost per kilowatt-hour. “That makes it difficult for other companies to compete with Tesla – we have the lowest cost battery, and most efficient car.”

“We made the investment in the Gigafactory , they didn’t,” Musk said. “We made a lot of effort at making the most efficient powertrains, they didn’t. That is what has put us into such a strong competitive position today.”

Even highly skeptical analysts, like Andrew Left from Citron Research, “a vocal and long-term Tesla short-seller who had predicted the stock would slump to $US100 a share”, said he had changed his position because Tesla was “smoking” the rest of the industry. “Elon Musk has made such a sideshow of himself that people started to forget about — including myself — the underlying business,” Left said on Bloomberg TV. “It’s a revolution that I actually underestimated — the way people are buying these cars.”

Note also that Tesla has just sealed a deal to build its Gigafactory 3 in Shanghai. As Cleantechnica writes, “Tesla is speeding up factory construction [in China] due to Trump-instigated trade tariffs.”

Tesla intends to produce the Model Y and Model 3 in Shanghai. Production capacity of the factory will be 250,000 vehicles a year.

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But the story is about much more than Tesla. As Tesla is battering the conventional car market, the incumbent car manufacturers have no choice but to join the race.

VW on 25 October has come out with a promise to build cars that are as good as Tesla’s, but at half the price.

VW CEO Herbert Diess said on German television: “We will come in 2020 with vehicles that can do anything like Tesla and are cheaper by half.”

VW already has a whole all-electric series planned, which it says it will market under the I.D. Vizzion brand. “It will start off with an all-electric hatch codenamed “Neo” and aims to  have 25 per cent of the global EV market in coming year.”

“We have invested €30 billion in electromobility, we have already rededicated a plant in Zwickau, and we are building an electric vehicle plant in Shanghai,” Diess said.

Although electric vehicles are likely to cost more at first, Diess says that “truly highly attractive vehicles” would come in 2019/2020, “which will be an alternative for many customers in terms of price, performance, range, and chargeability.”

From the end of 2019, the first all-electric models of VW’s ID series will be off the line at the car-maker’s Zwickau plant. VW expects 1,500 production EVs to be produced each day from 2020. Currently, the only VW cars manufactured in Zwickau are the Golf and Golf Variant.

At present, VW is building around 10.7 million cars a year worldwide, with Zwickau not expected to meet the demand for electric vehicles. To that end, VW intends to expand its Foshan factory in China with a view to an all-electric production line producing 100,000 EVs a year by 2020.

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The EV revolution will not only hit the oil sector hard, it will also have a huge impact on the electricity market through vehicle-to-grid technologies. These are still in an experimental phase, but progress is being made.

In Germany, Nissan has just announced that its Leaf car has been qualified by the German regulator to function as a power producer!

Nissan has worked with energy supplier Enervie and transmission system operator Amprion “to qualify the Leaf for all the German TSO regulatory requirements for primary power regulation”, reports the website The Driven.

What this mean is electric cars like the Leaf can be used to help stabilise the grid and smooth out power delivery which can be a problem for power companies using renewables with their fluctuating power delivery.

The TSO’s approval “means the Leaf can be integrated as a regulating reserve for the German electricity grid.”

Nissan hailed the test success as “a breakthrough in the establishment of Vehicle-to-Grid (V2G) technology which will shape the way we all generate and receive electricity.”

On the website Cleantechnica Steve Hanley notes that “Selling electricity back to the grid can put some serious cash in the pockets of electric car owners. In an experiment in Denmark last year, the average payout to owners was over $1,500. That’s nothing to sneeze at and could drive down the total cost of ownership of an electric car dramatically.”

But he adds that “There is a debate about whether allowing EVs to have a two way conversation with the grid is good for batteries. Many people believe V2G shortens battery life. Tesla CTO JB Strauble has said his company is not a strong supporter of V2G because the battery chemistry for EV battery cells and grid storage cells are different. But a study from last year suggests V2G technology may actually extend battery life.”

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Bridie Schmidt from The Driven reports on another technological advancement: Electric cars – and aircraft – could one day have carbon fibre bodies that store energy in place of batteries, while being up to 50 per cent lighter, researchers from Sweden have said.

A study conducted at the Chalmers University of Technology “has shown that the incredibly lightweight and strong material can be used as a battery electrode, presenting game-changing implications for EV makers”, notes Schmidt.

Leif Asp, Professor of Material and Computational Mechanics at the university, who heads the research group, published the study last week saying that the research showed that carbon fibre could also be used to harvest energy. “A car body would … be not simply a load-bearing element, but also act as a battery.”

“It will also be possible to use the carbon fibre for other purposes such as harvesting kinetic energy, for sensors or for conductors of both energy and data.”

“If all these functions were part of a car or aircraft body, this could reduce the weight by up to 50 per cent.”

The technology, which uses a slightly more flexible form of carbon fibre, would not only be lighter than existing lithium-ion technology, but safer, “as they would also not contain any volatile substances,” the research said.

Carbon Fibre Car Body diagramSource: Chalmers University of Technology

Concerns about using a flexible form of carbon fibre for a car body would not be a problem, says Asp, but requires automakers to rethink their approach to EV design.

“The key is to optimise vehicles at system level – based on the weight, strength, stiffness and electrochemical properties. That is something of a new way of thinking for the automotive sector, which is more used to optimising individual components,” says Asp.

There are, however, question marks about efficiency compared to lithium-ion technology, notes Schmidt. Asp says that the benefits outweigh the loss of energy. “Structural batteries may perhaps not become as efficient as traditional batteries, but since they have a structural load-bearing capability, very large gains can be made at system level.”

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Meanwhile, British manufacturer Dyson, known of course for its vacuum cleaners, has decided to build an EV factory in Singapore.

The company has long hesitated between England and Singapore for the location of its factory, but Cleantechnica reports it has finally decided to choose the latter. Construction will already begin in December. The first vehicles will roll off the assembly lines in January 2021.

The move is especially significant as it shows that EV production does not have to be limited to car manufacturers. As EV production is so much simpler than that of ICE (internal combustion engine) cars, any industrial manufacturer can enter this game.

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The rapid development of the EV market will no doubt give policymakers the confidence to take measures to discourage the use of polluting ICE cars.

The latest city in Europe to announce a future ban on ICE cars – following the likes of Paris, London and Oslo – is Madrid.

The Spanish capital is now implementing a plan (announced earlier), known as “Madrid Central”, that “will see all cars and motorbikes that are not either all-electric or hybrid, or possessing a minimum environmental classification, banned from the city’s central streets during the day.”

“Exceptions will be made for residents, or visitors with a special permit, who may continue using their high emissions vehicles until they purchase a new car. The ban also includes restrictions on parking cars on streets – residents must keep their old high emissions cars parked in a car park.”

The ban starts as of November 30, 2018, according to the City of Madrid’s website. Service providers to the downtown district will be given a grace period of 2 to 6 years to transition their fleet to low emissions vehicles – by 2020 for vehicles weighing less than 3.5 tonnes, and by 2025 for those over 3.5 tonnes.

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European EV battery industry is (finally) racing ahead

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ENERGY WATCH #2 - October 30, 2018

European EV battery industry is (finally) racing ahead

by Karel Beckman

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Launch of the European Battery Alliance October 2017

As EVs go, so go batteries. One after the other announcement is being made of new battery production initiatives – including in European countries. Although Europe has long been behind Asia in battery manufacturing capability, it now definitely seems to be catching up.

The two latest announcements of new initiatives have come from Northvolt and BASF.

Swedish battery manufacturing startup Northvolt has partnered with South Bay Solutions, a Tesla supplier, to jointly set up a plant in Poland to produce battery systems for energy storage companies and the mining industry, Reuters reported on 22 October.

Northvolt, founded by former Tesla executive Peter Carlsson, unveiled ambitious plans last year to build a vast cell production factory in Sweden with a planned capacity of 32 gigawatt hours by 2023.

It said the production plant in Gdansk, Poland would take cells from the Swedish factory and use them to develop battery systems, or modules.

Northvolt expects production to begin in 2019 and the site to have an initial manufacturing capacity of 10,000 modules per year. The company has yet to reach an agreement to supply its cells to a carmaker, but earlier this month said it was working with Germany’s BMW to develop a process to recycle batteries, adding that it hoped this was the first step in a “long partnership”.

On the same day, 22 October, BASF announced that it has selected Harjavalta, Finland, as the first location for battery materials production serving the European automotive market. The plant will be constructed adjacent to the nickel and cobalt refinery owned by Norilsk Nickel (Nornickel).

“This investment is part of BASF’s €400 million multi-step investment plan announced last year and builds upon initial battery materials production started in Harjavalta in 2018”, the company announced. “Start-up is planned for late 2020, enabling the supply of approximately 300,000 full electric vehicles per year with BASF battery materials. The new plant in Harjavalta will utilize locally generated renewable energy sources, including hydro, wind and biomass.”

Additionally, BASF and Nornickel “have signed a long-term, market-based supply agreement for nickel and cobalt feedstocks from Nornickel’s metal refinery. The agreement will establish a locally sourced and secure supply of raw materials for battery production in Europe.”

The company notes that “the investment in the new plant in Finland reinforces BASF’s support of the EU Commission’s agenda towards a European battery production value chain. BASF is also evaluating additional locations in Europe for the construction of new production plants for battery materials.”

“The co-location of BASF’s new plant and Nornickel’s metal refinery in Harjavalta will enable unparalleled access to a local nickel and cobalt supply,” said Jeffrey Lou, Senior Vice President, Battery Materials at BASF. “Our high-nickel cathode materials are key to deliver enhanced energy density and vehicle range to our customers.”

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BASF said that “with this world-scale production facility, BASF will be able to serve the European e-mobility growth strategies of key OEMs and cell suppliers with reliable supply and close collaboration.”

This refers to the initiative of the European Battery Alliance, set up by the European Commission last year.

On 15 October 2018, the Commission reported that “major progress” has been made “in establishing battery manufacturing in Europe” over the last year.

The Commission said that “The Commission Action Plan is in place, the first pilot production facilities are being built and further projects are announced to establish the EU as the lead player in the strategic area of battery innovation and manufacturing.”

The Commission notes that “in less than a year, the European Institute of Innovation and Technology (EIT) InnoEnergy has managed to mobilise and steer a network of around 260 innovation and industrial actors, coming from all segments of the batteries value chain. These key actors have committed to investing into actions and projects that they have collectively identified as top priorities, ranging from cells manufacturing, second-life batteries, ecolabel, carbon footprint reduction in manufacturing, a clearing house for batteries recycling, vehicle-to-grid, and enhanced cooperation between universities and companies to set up relevant education and training programmes.”

It list the following concrete projects: 

Battery materials

  • Umicore announced in June 2018 a major investment in Poland – Nysa – for the production of cathode materials. The plant will build upon the state-of-the-art technologies and is due to start deliveries in late 2020.Furthermore, a new Process Competence Centre will be built in Belgium to develop and scale up high-efficiency production technologies.
  • BASF is a strong player in the battery materials market. The company expects the market for lithium-ion batteries to grow rapidly and plans to add production capabilities in Europe.
  • Solvay is working on developing state-of-the-art electrolytes and electrode binders and separators that are needed for highly efficient batteries. The company is considering building a plant in Europe.

Battery cells

  • Work has already begun to build a demonstration line in a project led by Northvolt of Sweden (with a EUR 52.5 million loan from the European Investment Bank). The production is to start in the second part of 2019.Northvolt has also obtained the permit to construct a larger scale facility in Skellefteå in Sweden. The objective is to scale up production up to 32 GWh in 2023.
  • The BMW Group, Northvolt and Umicore have formed a joint technology consortium in order to work closely together on the continued development of a complete and sustainable value chain for battery cells for electrified vehicles in Europe.
  • The battery maker company SAFT has announced in February 2018 a consortium with Solvay, Umicore, Manz and others to develop and manufacture battery cells – starting with advanced Li-ion technology followed by Li-ion solid state.
  • Siemens is working with the entire cell manufacturing value chain on manufacturing challenges and solutions, and has recently engaged in piloting the first fully automated and digitized production lines in Europe.
  • Companies and research institutions in Germany are working with great ambition to establish a battery cell production in Germany in due time.
  • Other EU operators are also building facilities to produce battery cells, notably for energy storage applications (FAAM in Italy and MES in the Czech Republic).

The Commission has also started with the rapid implementation of the Strategic Action Plan for Batteries. Key actions are now underway:

  1. The regulatory framework – the work on a new Eco-design Regulation is rapidly developing, to set the performance and sustainability criteria that batteries will have to comply to be placed on the EU market. In the context of battery Ecodesign, the Commission’s Joint Research Centre has also published the results of a survey of battery-related standards. The Commission Report on the Evaluation of the EU Batteries Directive should also be published before the end of the year. It will address the collection of waste batteries, the recycling levels achieved within the EU or the labelling system. The results of the study in support of the Evaluation will be made available by the end of October.
  2. Raw Materials –a High Level Conference on Raw Materials in Brussels on 14th November will present recommendations based on a dialogue launched by the Commission with the Member States on battery-related raw materials in view of developing attractive framework conditions for exploration, extraction and recycling of battery raw materials in Europe. The Commission is calling on industry to also build raw materials refining capacity in the EU.
  3. Interregional Partnership on Batteries – at a workshop on 8th October an Interregional Partnership on batteries has been set up. Slovenia has proposed to take the lead together with 7 regions in total on advanced materials. Support is provided from the European Regional Development Fund (ERDF).
  4. Research – on 24 January 2019 a call will open with a total budget of EUR 114 million from the EU Research and Innovation Programme Horizon 2020 for battery related topics, also supporting European Battery Alliance objectives. In 2020, additional topics for battery-related projects with a total budget of EUR 70 million will be published.
  5. Skills – In the framework of the Erasmus+ programme, the next call for proposals for the Sector Skills Alliances implementing the Blueprint for Sectoral Cooperation on Skills will be published at the end of October 2018. This new call will cover six sectors including ‘batteries for electro-mobility’.

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This list of announced manufacturing projects and investments is by no means exhaustive, notes the Commission.

Indeed, it is hard to keep track of all the projects and plans for battery production and research in Europe.

In June 2018, Reuters published a Factbox on Plans for electric car battery production in Europe.

Europe has only one operating factory producing battery cells for electric cars, said Reuters, a plant in Britain that produces batteries for Nissan vehicles such as the LEAF.

It then gave an overview of plans to establish electric vehicle (EV) battery plants in Europe:

NORTHVOLT 

The Swedish company, headed by a former Tesla executive, aims to build Europe’s biggest lithium-ion battery factory, producing 32 gigawatt hours (GWh) of battery cells a year by 2023, rivalling Tesla’s U.S. “gigafactory”.

It has partnered with Siemens, ABB and Volkswagen-owned truckmaker Scania to build the 4 billion euro ($4.7 billion)plant while the European Investment Bank has provided financial support.

TERRAE

The German-based consortium of 17 companies and research institutions plans to build two foundries, where lithium-ion battery cells are custom produced to customers’ specifications. The two factories aim to have a capacity of 34 GWh by 2028.

BYD 

Chinese electric vehicle maker BYD is also one of the world’s biggest battery producers with the lowest production costs in the industry, according to Bernstein Research.

BYD is considering cell production in Europe, an executive told Reuters, adding it was not clear where it might be located.

BYD has a growing business making electric buses and is also involved in monorails, solar farms, and energy storage. The company has two production sites for electric buses in Europe, in Hungary and France.

The company, backed by Warren Buffett’s Berkshire Hathaway Inc, warned in March that Chinese subsidy cuts for new-energy vehicles could slash its quarterly profit by as much as 90 percent.

CATL

China’s Contemporary Amperex Technology Co (CATL), one of the biggest EV battery producers, said in November it was planning a $2 billion initial public offering to boost its lithium-ion battery output six-fold to 50 GWh capacity by 2020.

In January last year, CATL bought a 22 percent stake in Finnish auto supplier Valmet Automotive and has said it plans to build a factory in Europe, but has not announced details.

Volkswagen and Daimler have said they plan to buy batteries from CATL.

LG CHEM 

South Korea’s LG Chem plans to produce 100,000 EV batteries per year at a Polish factory due to be completed this year.

LG Chem supplies batteries to Volkswagen, General Motors and Renault SA.

SAMSUNG SDI 

South Korea’s Samsung SDI Co plans to open a factory near Budapest this year which would be able to produce batteries for 50,000 electric vehicles a year.

Samsung SDI, an affiliate of Samsung Electronics Co Ltd, also produces rechargeable batteries for electronic devices such as smartphones and energy storage systems.

Samsung SDI, which already has a plant in Austria assembling battery packs, has supplied batteries to Volkswagen and BMW.

SK INNOVATION 

South Korea’s SK Innovation plans to break ground this year on a battery plant in Hungary and launch production from 2020, producing 7.5 GWh of batteries per year. Customers would include Daimler, it said.

SK Innovation started as Korea Oil Corporation and owns South Korea’s largest crude oil refiner. It also has divisions for chemicals, lubricants, batteries and electronic materials.

GSR CAPITAL 

Last year, Chinese investment firm GSR Capital bought Nissan Motor Co’s electric vehicle battery business – Automotive Energy Supply Corp – including battery plants in Japan, the U.S. state of Tennessee and England.

The UK plant produces 2 GWh of lithium ion batteries per year for Nissan electric vehicles.

In February, GSR signed a $4.5 billion joint venture deal with Turkey’s Zorlu Holding to build a factory that would launch production in 2023 for batteries for electric vehicles and energy storage systems.

GSR said in March it would invest $500 million in Swedish electric car maker National Electric Vehicle Sweden (NEVS) and planned to start production of EV batteries at NEVS.

GSR Capital Chairman Sonny Wu told Reuters the Swedish plant may launch output in mid- to late-2019 and GSR was also looking at elsewhere in Europe for additional battery factories.

GS YUASA

Japanese battery maker GS Yuasa Corp said in January it would set up a factory in Hungary that would assemble lithium ion batteries and would consider producing cells on the site in the future.

Last year, the Nikkei business daily reported the company would begin mass-producing a new lithium-ion battery that would double the range of electric cars as early as 2020.

LISHEN

Chinese battery maker Tianjin Lishen plans to open a sales office in Germany, its first in Europe, and has held talks with Volkswagen and Daimler, a source at the company said in April.

Lishen’s biggest shareholder is China Electronic Technology Group (CETC), a state-owned firm managed by the central government, according to its website.

SAFT 

France’s Saft, owned by energy company Total produces a range of batteries, including for back-up power and industrial applications, but not for electric vehicles.

In February, it created an alliance with Siemans, Solvay and Manz) to develop a new generation of batteries.

The group will focus on advanced high-density lithium-ion and solid-state technology, targeting the market for electric vehicles, railway, marine sectors, among others.

CONTINENTAL 

German auto parts and tyre maker Continental AG formed a joint venture in March with China’s CITC Ltd to produce so-called “mild” hybrid batteries in China.

Continental also said it was considering making EV batteries using solid-state technology, but for now was holding out for more advances to be made in the field.

*

Note that this overview does not mention Leclanché, the oldest battery company in the world and (at least until recently) the largest lithium battery manufacturer in Europe, as we reported on Energy Post in 2015.

Leclanché is also ignored in the European Commission’s press release for some reason.

With regard to recycling initiatives, website The Driven reports that German carmaker Audi and partner Umicore are “one step closer to a closed loop on EV batteries after successfully completing the first phase of a battery component recycling program.”

Audi, which started the partnership with industrial materials group Umicore in June 2018, “is looking to ensure valuable raw materials used in lithium-ion EV batteries – which also includes cobalt, nickel and copper – can be recovered for use in new batteries instead of being relegated to landfill.”

“Lab tests run by the carmaker indicate that up to 95 per cent of the elements used in battery components can be recycled”, according to a statement by the company. “The focus is now on developing the technology by which end-of-life batteries for the new all-electric Audi e-tron can be resurrected into new batteries.”

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A new industrial wind power model – and “another big battery” that has “changed thinking about the grid”

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ENERGY WATCH #4 - October 30, 2018

A new industrial wind power model – and “another big battery” that has “changed thinking about the grid”

by Karel Beckman

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Engie applies new business model to Goya wind power project in Spain

For those readers who still believe that “renewable energy is too expensive to compete with fossil fuels” and “too variable to be reliable” – I have news. Bot these beliefs are (increasingly) obsolete.

Bloomberg  published an interview on 22 October with Loreto Ordonez, chief executive of Engie Spain. Key takeaway in one sentence: “Developing renewables subsidy-free in mature markets is a ‘new reality’, and the 300-megawatt Goya wind project in Spain will set the standard for how developers can counterbalance increasing exposure to market prices,” said Ordonez.

Engie has signed a complex power purchase agreement for a proportion of Goya’s wind generation and has also taken a 15% equity stake in the project to “show commitment” and because the utility sees “value in the performance of the share”, said Ordonez.

The project shareholders hope to benefit from an increase in market prices by selling part of the wind farm output on the wholesale power market, she explained. Additionally, “Engie will be responsible for managing the civil and electrical work for the project in partnership with local companies.”

Engie views this as “a new industrial model of ‘joint value creation’ where Engie is reducing risk in project development by overseeing numerous elements of the project.”

“The framework is an inspiration for us to take into other markets”, particularly those with increasing exposure to market prices, said Ordonez.

Ordonez called the financing “an innovative way of developing renewables. Goya is a way to make compatible the Group ambition to scale up in renewables with the new reality of the Spanish market, and other markets too, of increasing exposure to market prices. We are implementing Goya through an industrial business model – to create competitive advantage by bringing together our know-how in the renewable value chain. In Goya, we are not just putting together a PPA – which is making the project bankable –we are also participating in the equity; we are the energy offtaker; the green energy manager; and we build up part of the project – so we are doing all the civil and electrical work (balance of plant), in a joint venture with local partners.”

“So we are not only signing PPAs in the market, but we are trying to develop industrial models. At Engie, we strongly recommend our potential clients to sign PPAs at the same time as financial agreements in order to ensure that all business development phase is closed. Ultimately, a PPA supports the bankability of a project –so it makes sense to sign it at the same time as arranging bank financing.”

“The renewables market is moving to a new reality of increasing exposure to market prices”, notes Ordonez. “Goya is an innovative pilot that will set a new path to develop renewables in mature markets. This is not just a one-off in Spain –the framework is an inspiration for us to take into other markets.”

“We are looking at this project as an industrial project, so taking on the electrical and mechanical installations is an additional element to value creation. We are trying to counter-balance market risk not only by signing the PPA but also by adding additional levels of value creation into the project. From the beginning of entering into the project, we had this idea of industrial value creation. We want to bring every level of expertise that we have to the project, to capitalize value out of it. In order to do the balance of plant, Engie had to put in place a joint venture with local partners.”

The lesson of this story: it is a mistake to think of a renewables-based electricity market in static terms. Market players react to challenges (such as lower or zero subsidies) and come up with inventive solutions. (One more reason not to opt for a “socialist model” to combat climate change, as some misguided souls are advocating.)

*

Another technological fix that is enabling ever higher levels of intermittent renewable energy – and changing electricity market in the process – is battery storage.

Giles Parkinson reported recently how the Tesla big battery in Australia – the largest lithium-ion battery in the world – has “exceeded all expectations. Quicker, cheaper and with greater reliability, versatility, accuracy and efficiency than predicted, the storage system also looks set to provide a fast return on investment.”

He followed this up with another fascinating article, on 15 October, about a second big battery in Australia, which has not received the attention the Tesla battery got, but turns out to be just as much of a success.

“The Newman battery storage project, installed just over a year ago in a private-only grid in the Pilbara serving mostly mining industry customers in Australia’s north-west, is having just as profound an impact on the way people think about the grid”, notes Parkinson.

“The 35MW/11.4MWh Kokam lithium-ion battery was installed in September last year by Alinta, next to its 178MW Mt Newman gas-fired generator, which supplies mining operations such as Gina Rinehart’s Roy Hill facility…. Like the Neoen/Tesla big battery, the Newman battery has shown that it is faster, smarter, cheaper, and more reliable than the fossil fuel generators around it.”

The battery “has done what most experts thought it could not do”, writes Parkinson: “provide sufficient inertia to the local grid in the absence of thermal generators.”

The Kokam battery won the WA [Western Australia] Excellence in Engineering Award. The jury report concluded that “There is no real difference between the battery and mechanical (rotating mass) systems. And its speed of response has all but eliminated the supply interruptions that were relatively common in the small grid that relies on comparatively slow gas generators.”

In addition, “it has led to a significant saving on back-up gas generation.”

“It is the first, as far as can be determined, utility-scale battery energy storage system to provide grid-forming services on a high voltage network,” the citation for the award reads. “Until now, the conventional thinking had been that electrical networks needed thermal generators to be online and operating to provide the required inertia to support the network. Thanks to this significant milestone in electrical engineering, that is no longer the case.”

Parkinson observes that “you hear a lot about the so-called reliability of baseload fossil fuel generation. But the reality is that they need a lot of back-up in case of failures, which are frequent. In a big grid, that goes largely unnoticed, but in small grids like the Pilbara it stands out. The Mt Newman gas facility consists of four different units, and usually two of them are needed to back-up another. Not so now, with the new battery.”

According to Gary Bryant, Alinta’s head of asset strategy, the Newman battery can do at least three things that were previously not seen with such installations, reports Parkinson: “it can operate in standalone mode, it has grid-forming capability, and can provide frequency control by acting as a virtual generator.”

“It’s the ability to provide enough fault current to keep the grid stable whenever everything else goes pear-shaped that has proved the most valuable. The nature of such grids means that generators can be lost, and large loads can be lost.”

“We have had situations where we had no thermal generators, and the battery’s been able to hold the transmission line by itself,” Bryant said.

And the same thing has occurred when up to 80 per cent of load is suddenly lost. “The battery has responded within milliseconds,  absorbing the excess load until the system restabilises to ensure no loss for other customers,” Bryant said.

Previously, because of the slower response of the gas generators, cascading losses were often unavoidable. “We’ve definitely had fewer outages – our customer’s very happy with improvement of power quality.”

Is Bryant surprised? “Not really. The Alinta team travelled to South Korea to look at that country’s considerable deployment of battery storage, and choose the set-up that suited the Newman site best.

And he says there is a huge amount of interest in what it’s achieved.”

“It is changing the way everyone is thinking about these operations,” Bryant said. “The industry, generally, is starting to look at these things being genuine options to reduce gas consumption and maintain system strength and power quality.”

“We’ve had a lot of interest from miners – from the petrochemical industry, and from grid operators. We’ve had AEMO (the Australian Energy Market Operator), and quite a number of meetings with technical and policy advisors (from different governments).”

And he says there is no doubt that battery storage is now the technology of choice. Everyone wants one.

European electricity companies are sure to take note. Count on more and faster change in electricity markets and network operations.

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Spain boosts solar, discourages coal, while Belgium seeks back-up power

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EXPRESS #4 - October 30, 2018

Spain boosts solar, discourages coal, while Belgium seeks back-up power

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Premier Lik Keqiang and PM Charles Michel sign nuclear cooperation agreement

“Spain has scrapped a tax widely criticised for undermining solar power in Europe’s sunniest country, in the latest energy policy reversal by the country’s new socialist government which has also dimmed the outlook for coal power”, writes analyst Gerard Wynn in an article for the Institute for Energy Economics and Financial Analysis (IEEFA).

According to Wynn, “The full scale of the new government’s plans will be revealed by the delayed publication of a draft climate change and energy transition law, expected in early November, and the government’s forthcoming National Energy and Climate Plan.”

He notes that “the new energy outlook in Spain is being driven by Teresa Ribera, the government’s minister for ecological transition, a new position that merges energy and environmental policy. Since taking office after the Spanish Socialist Workers’ Party won last June’s election, Ribera has moved quickly to overturn a number of the previous government’s policies.”

“First, Spain switched sides in a European Union debate on the ambition of new EU renewable energy targets. Previously, the government had aligned with Poland against more ambitious targets, but Ribera pushed for a renewables target of more than 30% of energy use in 2030. In the end, the EU adopted a goal of 32%.”

The decision to scrap the solar tax “underlines the government’s support for renewables and should boost the country’s long-suffering solar energy industry.”

Under the tax, “all new and existing solar systems bigger than 10kW had to pay a generation charge, even when the electricity was consumed on site, and all rooftop installation projects faced prohibitive red tape”, notes Wynn. “As well as scrapping the tax, the new decree simplified the technical and administrative requirements for installing small-scale renewables.”

Next, says Wynn, “Ribera may turn her attention to coal, where the government has already made some significant moves. In June, Ribera hinted at a Spanish coal phaseout, mentioning a 2025 date proposed by a panel advising the government. Then, in September, Spain flipped from opposing an EU ban on state aid for coal power plants under so-called capacity markets to supporting such a ban.”

He notes that “Indicating the scale of the reversal, Spain’s previous government had proposed a veto on coal power plant closures, apparently to prevent Spanish utility Iberdrola from closing its last two remaining coal power plants. That proposal was recently dropped, after failing to win a majority in Parliament.”

“The new government has doubled down on an expected end to coal mining, under a longstanding EU policy to end mining subsidies. On Wednesday, the government signed a “just transition” agreement with the mining regions of Spain, which would see all mines in Asturias, Aragon, Castilla and Leon close by the end of this year.”

*

Belgium, meanwhile, is still frantically trying to find new electricity sources to make up for its expected power capacity shortage which could hit the country early in November as a result of the problems at its nuclear power stations. Six of the country’s seven nuclear power stations are not operating at the moment.

Belgian media report that Belgium has signed an agreement with Germany for the supply of additional power. However, Belgium and Germany have no direct interconnection (the first cross-border connection is expected to be ready in 2020), so the electricity would have to be transported through the Netherlands, Luxemburg or France.

Engie, Belgium’s largest electricity producer, has signed an agreement with chemical company Bayer, which could make its CHP plant in Antwerp available if shortages arise. Engie will also re-start its gas power stations in Vilvoorde and Genk-Langerlo, which were both about to be torn down. Each has a capacity of 44 MW. Altogether, Engie has now found cover for 485 MW of the 750 MW of expected capacity shortage.

Remarkably, Belgium in October also signed a cooperation agreement in nuclear energy with China.

The agreement was one of several accords signed in Brussels on 17 October during a meeting between Chinese Premier Li Keqiang and Belgian Prime Minister Charles Michel.

“Li said the two countries could boost cooperation in technology and innovation and expand nuclear cooperation on the basis of abiding by international laws and meeting international obligations,” China’s Ministry of Foreign Affairs said in a statement. “The two countries can deepen practical cooperation in infrastructure development and the digital economy while actively exploring third-party market cooperation.”

Since Belgium plans to shut all its nuclear power stations by 2025, such an agreement would seem to be not very useful. Unless of course the Belgian government changes its mind …

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New power-to-gas plant in Germany largest to date

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EXPRESS #1 - October 23, 2018

New power-to-gas plant in Germany largest to date

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Tennet is seen here building Nordlink which will be the first high-voltage cable between Germany and Norway expected to be ready in 2020

Last week on Energy Post we wrote in detail about the theoretical potential of power-to-gas technology, on the basis of a study from the Oxford Institute for Energy Studies (OIES), this week we have a concrete project to announce – still a pilot plant, but of reasonable size (100 MW).

Grid operators Tennet, Gasunie Deutschland and Thyssengas announced “detailed plans for coupling the electricity and gas grids and advancing the energy transition”, the companies said in a press release. “The three grid operators are planning to build a power-to-gas pilot plant in Lower Saxony; at an output of 100 megawatts, it will be the largest of its kind in Germany.”

The project – called Element One – would collect power from Tennet’s substations in Diele and Conneforde, in the northern state of Lower Saxony, for conversion into hydrogen.

That could then be transported by the gas network to users in the industrial and transport sectors.

The three partners hope the plant will begin operating from 2022. No details of cost or investment plans were given.

Tennet says it believes that “there is great potential in power-to-gas technologies, as they can introduce a urgently needed level of flexibility into the power grid.”

“We need powerful storage technologies if we want to achieve our ambitious expansion target for renewable energy by 2030. The ability to store large volumes of renewable electricity will reduce the load on the power grid. That, in turn, helps us limit the expensive curtailment of wind turbines and make the power supply more reliable,” Lex Hartman, Managing Director of Tennet, commented.

He added: “Storing more green energy also entails a reduced need for further grid expansion after 2030.”

“Power-to-gas technologies are crucial if we want to achieve our climate targets for 2030 and 2050,” Jens Schumann, Managing Director of Gasunie Deutschland, emphasised. “Especially the concept of sector coupling – the intelligent, economical integration of gas, electricity, heat and transport infrastructures – offers immense potential that is yet to be unlocked. Power-to-gas technologies are extremely relevant in this respect, as they constitute a practical solution for connecting previously separate infrastructures.”

Power-to-gas is increasingly seen as a key enabler of Europe’s future energy economy, especially given its potential to cross over into sectors such as mobility and heating, notes Recharge News.

The website writes that Germany’s attempt to build power transmission infrastructure linking the windy north to demand centres in the south has been a delayed and controversial process in the country.

The Süddeutsche Zeitung last week reported that Germany’s energy ministry is drafting a law to accelerate the development of the country’s electricity. The draft, seen by the paper, will include streamlining the planning procedure, particularly where new power transmission lines are going to follow existing routes. It also includes new options for penalising property owners and grid operators who delay expansion works. The law is currently being reviewed by other ministries and is due to be voted on in parliament in December.

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EDF pitches to become leading e-mobility provider in Europe, Renault builds storage plant from EV batteries

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ENERGY WATCH #3 - October 16, 2018

EDF pitches to become leading e-mobility provider in Europe, Renault builds storage plant from EV batteries

by Karel Beckman

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EDF subsidiary Sodetrel supplies EV charging

In the electricity sector, the energy transition comes in the form of renewable energy. In the transport sector, a similar transition is taking place, in the form of electric cars.

It is still a slow, almost stealthy transition, which has no impact yet on oil demand, but it has all the signs of a gathering storm. We have been following developments in the EV market closely on Energy Post Weekly, and almost every week has brought major news from major companies (such as here, here, and here – and you can go through our archives for more.)

This week is no exception. On 10 October, French state-owned EDF – the largest utility company in Europe – has announced it “intends to become Europe’s leading e-mobility energy company by 2022”.

EDF launched what it calls its Plan Mobilité Electrique (Electric Mobility Plan) in order to become the sector’s leading energy company on its four biggest European markets: France, UK, Italy and Belgium.

This comes after launching the Plan Solaire (Solar Plan) in December 2017 and the Plan Stockage Electrique (Electricity Storage Plan) in March 2018.

In France, “EDF is already a standard-bearer in the electric mobility sector”, notes the company – which has a great advantage in that its own electricity generation is 87% CO2-free thanks to its nuclear power stations. “The Group has put together dedicated offerings that include the supply of low-carbon electricity and charging solutions. It is also one of the biggest charging network operators thanks to its subsidiary Sodetrel, which operates 5 000 charging points in France and provides access to 60 000 charging points in Europe for customers with a Sodetrel Pass.”

With the Electric Mobility Plan, EDF is “stepping up the pace” by setting three concrete targets on its four main European markets:

  1. Becoming the leading power supplier for electric vehicles by 2022

EDF is aiming to supplying power for 600 000 electric vehicles, equating to 30% of market share in France, the UK, Italy and Belgium. Starting in 2019, the Group will present each of these markets with a fully integrated range of offerings including low carbon electricity, a charging solution for all its customers with access to a parking space, and services geared towards optimised charging and use of the vehicle’s battery.

  1. Becoming the biggest charging network operator

EDF will become the leading public and private charging network operator in the four core European countries. Through its subsidiary Sodetrel, the Group is aiming to deploy 75,000 charging points and provide its customers in Europe with access to 250,000 interoperable terminals by 2022. EDF will also be developing novel charging solutions for all customers without access to a parking space, in particular through collaborative innovation initiated by EDF New Business and EDF R&D.

  1. Becoming Europe’s “smart charging” leader

Electric mobility will transform power systems as the electric vehicle is also a battery that can be used for the grids to balance load during periods of high demand. With its Electric Mobility Plan, the Group will become Europe’s smart charging leader, aiming to operate 4 000 smart charging points by 2020.

EDF notes that “the Plan Mobilité Electrique relies on new partnerships with innovative players who are leaders in their respective markets.”

The first series of partnerships has been formed between:

EDF and NUVVE: EDF Renewables North America holds a minority interest in NUVVE, a Californian start-up based in San Diego specialising in the aggregation and harnessing of flexible solutions for energy markets, associated with the charging of electric vehicles. EDF and NUVVE have signed a strategic partnership agreement with a view to forming a joint venture to develop these solutions in Europe.

EDF and Ubitricity: EDF and German-based start-up Ubitricity have been commercial and technological partners since 2014. Ubitricity has developed an innovative solution to convert existing streetlights into charging points and delivered several projects in Europe and across the world. Citelum (100% affiliate of

EDF Group) and Ubitricity are partnering to integrate this innovative solution to Citelum’s “smart city” range of product.

EDF and Renault have formed a partnership to develop shared offerings and to experiment electric mobility solutions in isolated regions and big cities.

EDF and Toyota have been electric mobility partners with a focus on R&D since 2007 and have extended this partnership to low-carbon industrial performance on the Onnaing site in Valenciennes since 2017. The expertise of both EDF and Toyota is now opening the way to new cooperative endeavours in the areas of smart charging and hydrogen charging station specifications.

EDF and Valeo: EDF, the low carbon energies champion and Valeo, the leader in high and medium voltage electrification, have formed a partnership to monitor the development of future battery technologies and charging solutions, as well as the development of mobility services. This partnership will be supported by the installation of shared demonstrators.

EDF Energy (100% subsidiary of the EDF Group) and Nissan International have formed a UK-based partnership for the development of shared offerings in the areas of electric mobility, smart charging, second-life battery use, energy storage and renewable energy sources. The two partners will be pooling their international experience and know-how in these areas, thereby helping to develop low-carbon, innovative and responsible transportation systems.

***

What is particularly noteworthy about EDF’s announcement is that it comes from a major incumbent company. In this respect there is an important difference between the EV revolution and the renewables revolution. In the latter case, incumbent utility companies initially resisted the transition. In the case of EVs, they have an interest in advancing it.

For incumbent European car companies the story is different of course. They have needed competition from Tesla to be shaken out of their lethargy.

Arguably with one exception: French-Japanese car maker Renault-Nissan has long been in the forefront of the EV revolution. As far back as 2008, Renault and Nissan formed a joint venture with Israeli entrepreneur Shai Agassi, based on an inventive battery swap scheme. The company, Better Place, went bankrupt in 2013.

But Renault-Nissan-Mitsbushi, as the company is now called (it is said to be the biggest car manufacturer in the world) has not given up on its EV ambitions. The Nissan Leaf, for example, has been Europe’s bestselling car in the lower price segment.

Recently, at the end of September, the Renault Group launched Advanced Battery Storage, “a stationary storage system for energy developed exclusively from EV batteries.”

The new battery system, with a storage capacity of at least 60 MWh, making it the biggest system of its kind ever built in Europe, will solve two problems at one stroke: it will help integrate intermittent power generation from renewables – and it will be built with used EV batteries.

The first facilities will be developed in early 2019 on three sites in France and Germany: at the Renault plants in Douai and Cléon and at a former coal-fired plant in North Rhine-Westphalia. The storage capacity will then be gradually expanded over time to contain the energy of 2,000 EV batteries. At this phase, the system will have reached – or more likely, exceed – the 60 MWh, equivalent to the daily consumption of a city of 5,000 households, notes Renault.

The system will use both second-life batteries, as well as new batteries stored for future use in standard replacement during after-sales operations.

What is important about this move is that it will extend Renault’s role as a vehicle manufacturer “to become a player in the smart electric and energy ecosystems”, as the company notes, “with the help of its partners. As part of the “Advanced Battery Storage” program, Groupe Renault has joined up with several players including La Banque des Territoires, the Mitsui Group, Demeter (via le Fonds de Modernisation Ecologique des Transports), andThe Mobility House.”

***

How fast the EV revolution could happen, if the right incentives are put in place, is demonstrated by Norway, global leader in EV sales.

The latest data show that this oil and gas exporter achieved record EV sales in September. As the website The Driven reports, “Of 10,620 new passenger vehicles registered in Norway, nearly half were electric, according to the Norwegian Road Traffic Advisory Council (OFV).”

“The car market in September was particularly special, new Norway records and a new world record were introduced for the sale of electric cars,” said Øyvind Solberg Thorsen, director of the OFV.

For the first time in modern history, electric cars stood for almost half of passenger car sales for a month, notes The Driven. “New electric cars had a market share of 45.3 per cent, and including imports of almost new electric cars, the proportion was 47.7 per cent.”

“Such an increase in electric car sales caused a record low CO2 emissions of 55 g/km. Although we in Norway are accustomed to average CO2 emissions falling from month to month, this is the lowest level we have ever measured,” said Solberg Thorsen.

One of the reasons behind the record-breaking month is the introduction of stricter methods of measuring fuel consumption and CO2 emissions, notes The Driven. “The new measurement method means higher consumption and CO2 emissions and therefore entails that taxes increase on most passenger cars with internal combustion engines, including rechargeable hybrids.”

Comparing CO2 emissions levels from the previous year, average emissions for all first-time registered new passenger cars in September 2018 came in at 55g/km, a full 16g/km lower than September 2017.

Of the 10,620 passenger cars sold, 4810 new passenger cars were registered with zero emissions, 954 more than 12 months previous when the market share was 28.6 per cent. Only eight of the new registered passenger cars in September were hydrogen cars, the rest were battery electric cars.

While all-electric and hydrogen vehicles registrations increased, hybrids dropped, notes The Driven.

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Italy, Spain boost renewables, Serbia boosts lignite

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EXPRESS #4 - October 9, 2018

Italy, Spain boost renewables, Serbia boosts lignite

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Kostolac power plant in Serbia - China is helping to build unit 3

The Italian government has said it will soon be issuing a decree in support of solar PV and other renewable energies.

It has also proposed changes favourable for PV linked to projects for asbestos removal. Alberto Pinori, president of Italy’s renewable energy association, Anie Rinnovabili, has praised the government’s new attitude and its agencies, notes PV magazine.

Italy will spend up to €900 million by 2020 for the development of new renewable energy installations. These will include 6 GW of new capacity, mostly solar, with the aim of adding 10 TWh per year of renewable electricity to the grid.

The new Spanish government is also aiming to boost renewable energy, for one thing by suspending the notorious 7% solar tax which owners of solar panels have to pay. According to Spanish energy experts, the average family home with three solar panels fitted to their home pay around €70 each month to remain connected to the grid whether or not they use the electricity it generates.

Spain’s new Minister of Ecological Transition, Teresa Ribera, has announced that the tax will be scrapped as the government seeks to reduce Spain’s spiralling energy costs for households – Spain, in the second half of 2017, had the fifth highest electricity prices in the entire European Union.

Spain’s new commitment to renewable sources is supported by a recent €450m finance package issued by the European Investment Bank, which will fund Spanish solar and onshore wind projects. This new capacity will also substitute for almost 5GW of Spain’s coal-fired capacities, which are set to be closed that year.

***

In Serbia, the independent grievance body of the European Bank for Reconstruction and Development (EBRD) has started investigating a €200 million ‘restructuring loan’ granted in 2015 to Elektroprivreda Srbije (EPS), the largest energy company in Serbia, following a complaint by CEE Bankwatch Network and Serbian environmental group CEKOR, according to a press release from CEE Bankwatch.

According to the NGOs’ complaint, “although the investment is on corporate level (…) the project has caused harm (…) due to freeing up resources to allow the company to implement its long-term capital expenditure programme which includes lignite mine expansion and the construction of several coal plants.”

Back in 2015, the EBRD granted this loan to EPS after massive rainfall flooded EPS coal mines and damaged the company’s infrastructure. Nominally, the EBRD loan was meant to help the company get over the floods, but an EBRD board document said the money was meant to ensure the company can implement its long-term capital expenditure programme – and that means more coal, says CEE Bankwatch.

According to the press release, “the 2015 loan is one in a series of several loans the EBRD has given to EPS since 2001, despite the company clearly pursuing a strategy to expand coal-based electricity production and numerous allegations of corruption and legal violations tarring its reputation.”

According to the 2016 Energy Strategy of Serbia, in addition to prolonging the life of existing coal plants, EPS is planning several new lignite power plants: Kostolac B3, Nikola Tesla B3, Kolubara B and Stavalj. While it is unlikely that all of these will go ahead, EPS clearly prioritises Kostolac B3 in the implementation programme for the energy strategy and has not publicly announced any cancellations of the other plants, notes Bankwatch.

Bankwatch charges that “EPS is also expanding the Drmno lignite mine’s production capacity from 9 to 12 million tonnes per year, and it is doing so without an environmental and social impact assessment, in breach of EBRD policy, as well as Serbian and EU legislation. In September, Bankwatch and CEKOR also submitted a complaint to the Energy Community about mine expansion works going ahead without the necessary precautions.”

“The EBRD’s 2015 loan for EPS should have prepared a coal-heavy company for the realities of adhering to stricter EU legislation. Instead, it appears to have freed up resources so that the company can extract and burn even more coal,” says Ioana Ciuta, energy campaigner at Bankwatch.

The EBRD’s Project Complaint Mechanism has now declared the NGOs’ complaint eligible and published its assessment report, which raises a series of questions about the Environmental and Social Policy of the bank when it comes to corporate level finance. According to Bankwatch, “the assessors’ willingness to examine a ‘restructuring loan’ is a step in the right direction since such loans can serve as a facade for indirectly financing problematic projects.”

The EBRD will organise a public consultation in Belgrade on October 19, in the context of its Energy Sector Strategy revision, where it is expected that lending to coal dependent companies, such as EPS, and decarbonisation of the energy sector will be among the topics for discussion.

A new report published by Bankwatch shows “how EPS and other companies in Poland, the Czech Republic and Bulgaria have been receiving generous financial support from European development banks despite their continued reliance on fossil fuels. In light of the revision of the EBRD’s Energy Strategy, the report makes the case for conditioning further financing to such companies on decarbonisation plans in line with the Paris climate agreement.”

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Germany’s 56 GW of wind power can be relied upon for less than 1%

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EXPRESS #4 - October 2, 2018

Germany’s 56 GW of wind power can be relied upon for less than 1%

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Wind power in Germany

Germany has now an impressive 56 GW of wind power capacity installed –the equivalent (in capacity, not production) of some 56 coal power stations and almost 19% of total German power capacity.

However, the country can reliably count on a mere 1% of this capacity, reports the respectable German newspaper Handelsblatt. In other words, there are times when there is almost zero wind power capacity available for the system.

Handelsblatt bases itself on not-yet-published figures from the Verbandes VGB PowerTech, a trade association that represents companies active in a wide range of energy technologies, including renewables.

In an interview with Handelsblatt, CEO of VGB PowerTech Oliver Then says that “the actual production figures show that the readily available wind power capacity in Germany is less than one percent of installed capacity”.

VGB PowerTech made a detailed analysis of wind power production in Germany, UK, Spain, Denmark and Portugal in 2016. This showed, says Handelsblatt, that Germany cannot count on other countries to make up for a lack of wind power. “The power production over the course of time is to a large extent synchronous”, notes Then.

And widespread “Dunkelflaute” (dark doldrums when there is very little wind or solar power) are hardly a theoretical phenomenon. They occur every year, says Then.

The use of pumped hydro storage to make up for lack of wind power would be prohibitively expensive. It would require ten times more storage capacity than is available now. Oliver Then concludes that backup from fossil plants will remain a necessity for a long time to come.

None of this of course is really new. But what the VGB analysis does show is that the amount of wind power capacity has no effect on its reliability. When there is no wind, it won’t matter how many wind turbines a country has. Which is not exactly rocket science either.

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Greenpeace attacks national capacity schemes – two-thirds subsidize coal (€38 billion)

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EXPRESS #4 - September 18, 2018

Greenpeace attacks national capacity schemes – two-thirds subsidize coal (€38 billion)

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Puente Nuevo coal power plant in Cordoba, Spain

The debate around national capacity schemes is coming to a head in Brussels, our EU correspondent Sonja van Renssen wrote last week.

Now Greenpeace has weighed in on the debate. It charges that most capacity mechanisms in use in EU member states serve as hidden subsidies for coal, gas and nuclear plants.

“European governments are covertly adding almost €58 billion to energy bills in order to prop up coal, gas and nuclear plants”, says Greenpeace. According to Greenpeace, just 1% of the money involved in capacity schemes goes to renewables and demand response schemes. 66% goes to coal plants, around €38 billion.

“So-called capacity mechanisms – a type of subsidy given to coal, gas and nuclear plants supposedly to ensure supply in case extra power is needed – have almost quadrupled in the last twenty years. From 1998 to 2018, these subsidies to old, unprofitable and polluting power stations have cost consumers €32.6 billion”, Greenpeace notes.

“A number of European governments have already committed to a further €25.7 billion until 2040, with Belgium and Poland allocating the largest sums to date”.

Greenpeace notes that it “gathered and analysed publicly available data on past, existing and planned capacity payments in Europe. It was possible to identify the fuel source receiving the payment in slightly less than half the cases. Of these, 98% of the subsidies goes to fossil fuels and nuclear energy: 66% goes to coal plants alone, while gas receives 25%. Nuclear gets 4%, but France and the UK which have large-scale nuclear production provide 31% and 14% to nuclear respectively.”

By contrast, “renewables, including hydro and bioenergy, receives 0.5%, and demand-side response (efficient management of energy use) and power interconnectors less than 0.5% each.”

Greenpeace EU climate and energy policy adviser Sebastian Mang said: “Big utilities are cashing in on subsidies that divert public money to keep unprofitable, polluting plants alive. Bankrolling dirty energy heats up the planet, contaminates the environment and endangers lives. Propping up coal, gas and nuclear is also slowing down the transition towards 100% renewable energy, which is crucial to avert the climate chaos Europeans are beginning to experience in their everyday lives. European governments must end this dirty practice.”

This autumn, national governments and the European Parliament will decide whether or not capacity mechanisms will be restricted by EU law. The Commission proposal for the Electricity Market Regulation and Directive, supported by the European Parliament, would require governments to prove that there is a security-of-supply issue before power utilities are granted subsidies. Under this proposal, only the plants emitting less than 550g CO2/kWh would be allowed to access capacity mechanisms after the assessment demonstrates a need.

National governments rejected this proposal during an energy Council meeting on 18 December 2017. Large utilities have also rejected the proposal.

According to Greenpeace, capacity mechanisms are actually “unnecessary because the capacity in Europe to produce energy significantly outweighs demand…. Europe’s overcapacity is expected to continue for a long time. Because fossil fuels and nuclear energy are propped up by capacity mechanisms, their price is kept artificially low. This penalises renewable energy and distorts the market.”

For more on the Spanish capacity market schemes, see this article on Energy Post by Gerard Wynn.

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High on the Brussels autumn agenda: electricity market design, CO2 standards for cars, climate policy

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BRUSSELS INSIDER #1 - September 4, 2018

High on the Brussels autumn agenda: electricity market design, CO2 standards for cars, climate policy

by Sonja van Renssen

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Dieselgate will come back to haunt Brussels

As Brussels re-opens for business, there are a few big energy files to wrap up before the European Parliament enters election mode next year. It’s down to Austria, holder of the EU presidency until the end of the year, to broker a deal on an electricity market reform, which will decide on capacity mechanisms, priority dispatch and balancing responsibilities for renewables. A second highly contentious file is new CO2 standards for cars and vans (plus a sister proposal for trucks and buses). And finally, EU climate and energy policymakers will be looking to leave their mark on the world stage at the next round of UN climate talks in Katowice, Poland (COP24) in December.

European Commission officials insist that they are not in ‘legacy-mode’ just yet, but it is hard to ignore the burgeoning wave of chatter about the upcoming changing of the guard in Brussels. In May 2019, there are European Parliament elections; in November 2019, a new European Commission will take office. Who will be the next Commission President? How much of a grip will populist parties get on the Parliament? These are the questions that are already occupying much of the Brussels bubble.

But there is work to be done before then. The politics is exciting; the laws are the legacy. It falls to Austria to close a number of important legislatives files before the year is out. Austria took on the rotating 6-month EU presidency from Bulgaria on 1 July. It will hand over to Romania on 1 January, but by then, many MEPs will already be in campaigning mode.

The most urgent energy file to close is the power market redesign proposed by the Commission in its Clean Energy Package of November 2016. This package creates a new climate and energy framework for the EU for 2021-30. Before the summer break, Commission, Parliament and Council (Member States) managed to seal deals on new EU directives on renewables, energy efficiency and governance (i.e. national energy and climate plans).

That’s half the package done. The second half – another four legislative proposals – seeks to rewrite the rules of European electricity markets. The primary goal is to adapt them to an ever greater share of renewables and a more active consumer, whilst preserving security of supply. The EU’s success in meeting its renewables, energy efficiency and indeed future climate targets will depend to a large extent on the rules that govern its power markets.

Power market reform will rewrite EU energy mix

Back in June, when negotiators reached agreement on a new EU renewable energy directive, the European Consumer Organisation (Beuc) already warned that market design is crucial. The new renewables directive was hailed as a victory for self-consumption – or the right for citizens to produce and consume their own energy without punitive taxes – but the power market reform will decide on “technicalities” such as whether the power produced by households is prioritised when it comes to uploading it to the grid.

MEPs and the Commission want to maintain priority dispatch for all existing and small (<500kW) new renewables installations; Member States want the freedom to decide for themselves. National energy regulators have proposed to scrap priority dispatch, arguing that the cheapest plants should run to minimise consumer bills.

Where MEPs and Member States do agree – and what renewables groups like lot less – is that national governments should be able to impose balancing responsibilities on renewables producers. SolarPower Europe has warned that this could inflict “serious burdens on consumers”. It is part of a “Small is Beautiful” campaign to protect the current privileges of decentralised energy providers. WindEurope says: “It’s unclear what compensation will need to be paid [by renewables producers] to TSOs [Transmission System Operators].”

Overall however, renewables stand to benefit from the move to more short-term, dynamic, flexible markets. Unlike coal and possibly gas.

One of the other most contentious parts of the reform is a proposal – backed by all three EU institutions – to introduce a 550gCO2/kWh emission standard for capacity mechanisms. This standard will exclude coal plants from capacity payments. Council and Parliament need to thrash out when it takes effect – and whether to exempt strategic reserves. The Parliament has come up with an alternative 200kgCO2/kW annual limit for strategic reserves, which would basically let even the dirtiest German lignite to run, if not for too long.

As we’ve reported in the past, how the 550gCO2/kWh is calculated will also decide whether open cycle gas plants are in or out. More broadly, the power market reform is crucial for capacity mechanisms because the rules it sets will be binding, including for existing schemes.

MEPs and Member States will hold their first real negotiation on power market reform this week, after a ‘meet-and-greet’ session at the end of June. At that session, the 550gCO2/kWh standard reportedly emerged as a flash point. Other areas of contention going forward are set to be the role of a European (vs. national) resource adequacy assessment(s) – to determine the need for capacity mechanisms in the first place – and the rules around the use of the grid and its operators.

Fresh controversy erupts over post-2020 car CO2 standards

One of the other most important climate and energy files out there is a legislative proposal for new CO2 standards for cars and vans for after 2020. This is a highly political – and controversial – proposal, coming in the aftermath of Dieselgate and at a time when transport continues to be the biggest challenge for climate policymakers. Transport consumes a third of Europe’s energy and emits a quarter of its CO2. Its emissions are still above 1990 levels.

No surprise then that new CO2 standards for cars and vans are at the heart of a low-emission mobility package issued by the Commission in three parts in May and November 2017, and May 2018. The Commission wants the average CO2 emissions of new cars and vans to be 30% lower in 2030 than in 2021. That’s neatly in between the 20% advocated by the car industry and 40% put forward by NGOs – not that it has stopped the two from some vigorous interaction.

Fresh controversy erupted over the summer when campaign group T&E obtained a letter and explanatory ‘non-paper’ from the Commission, in which the EU’s climate and industry Commissioners, Miguel Arias Cañete and Elżbieta Bieńkowska, outline evidence of the car industry manipulating a new CO2 emissions test, the so-called worldwide light vehicles test procedure (WLTP).

T&E explains: “The non-paper details the methods used to inflate CO2 emissions values. The Commission explains that such inflation effectively weakens the ambition of the proposed new car CO2 reduction targets for 2025 and 2030 [since they would be based on an inflated baseline]. The letter and paper were sent to the Austrian presidency of the EU, the chair of the European Parliament environment committee and the lead MEP on the legislation for new car CO2 targets.”

Yes, it’s urgent: on 10 September, the European Parliament’s environment committee will vote on the post-2020 standards in a first step towards negotiations with Member States (who, for the moment, remain deeply divided).

Cañete and Bieńkowska have made several suggestions to “rectify” the inflation problem, including basing targets on “values measured” not “values declared by manufacturers”. The European Automobile Manufacturers Association (ACEA) said in a response that it “fully agrees that CO2 values should not be artificially increased on purpose in any way”.

In parallel to the talks on cars, don’t forget trucks. In the third and final part of its mobility package, the Commission proposed the EU’s first-ever CO2 standards for trucks and buses. With Dutch Green MEP Bas Eickhout at the helm in Parliament, you can expect the sparks to fly. Eickhout presented his report to the Parliament’s environment committee on 29 August.

EU doesn’t plan to go to Katowice empty-handed

It’s been common knowlege in Brussels for a while now that the EU’s new energy efficiency and renewable energy targets will see it exceed its 2030 climate target. In short, the EU’s 40% emission reduction pledge for 2030 – its contribution to the Paris Climate Agreement – is based on a 27% renewables and 30% energy efficiency target. But EU negotiators settled on a 32% renewables and 32.5% energy efficiency target when they closed these files in June.

A Commission non-paper that was widely circulated during the negotiations more or less did the maths: this adds up to a 45% emissions reduction. So why such an uproar when EU climate and energy Commissioner Miguel Arias Cañete did the obvious and suggested that the EU increase its climate target?

The Spaniard told the Deutsche Presse-Agentur (dpa) on 21 August that he plans to ask Member States to raise the EU’s greenhouse gas emission reduction target from 40% to 45% “later this year”. He hopes to get the green light in October – presumably at a meeting of European heads of state and government pencilled in for 18-19 October – ahead of the next round of UN climate talks in Katowice, Poland, in December, the dpa reported.

Katowice is already being held up as a potential milestone. It is here that world governments are supposed to make good on the historic Paris Climate Agreement of 2015 by agreeing a “rulebook” to implement it. Of course the elephant in the room is US President Donald Trump’s decision last year to withdraw from the agreement. In response to that, the EU has made much of stepping up climate and energy cooperation with other partners, such as China. The show must go on.

Except that the script is still being written. An extra round of talks takes place this week in Bangkok, Thailand, in an attempt to get the UN negotiations on track.

Back in Brussels, Cañete elicited criticism from both NGOs and businesses with his 45% proposal. The former said it doesn’t go far enough, while the latter warned against more uncertainty and unilateral action. “It is wrong to pretend that Europe could compensate for the US exit from the Paris climate deal,” Holger Loesch from the Federation of German Industries (BDI) told the dpa.

Half of the EU’s Member States have called for a higher target. But German Chancellor Angela Merkel has poured cold water on the idea, telling German broadcaster ARD on 26 August: “We should first reach the goals we have already set. I don’t think that constantly setting new targets makes sense.”

Cañete has another card to play of course: a new EU 2050 climate and energy strategy. The Commission plans to finish this for November. This should inform the 2030 pledge. This is the bigger prize. It’s intended to be part of a much deeper reflection on where the EU as a whole is going. Which brings us back to the elections next year. With the changing of the guard and Brexit on top, 2019 is the moment for the EU to reinvent itself. Until then however, policymakers please remember: the politics is exciting, the laws are the legacy.

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Australia takes cue from Donald Trump, South Australia follows California

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EXPRESS #4 - August 21, 2018

Australia takes cue from Donald Trump, South Australia follows California

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Malcolm Turnbull

The Australian government is taking a leaf out of Trump’s energy book, dumping any climate ambitions and directly backing coal power. The good news is that South Australia is following California’s example, even going one better, heading for a 100% renewable-powered electricity mix.

Federal Australian energy and climate policy plans currently revolve around the National Energy Guarantee (NEG) which the Liberal-National coalition government of prime minister Malcolm Turnbull is trying to get agreement on.

The latest news, as reported by Giles Parkinson and Sophie Vorrath on Reneweconomy.com.au, is that the government has dumped any emission targets from the NEG in an attempt to get support from the far right members within the government parties, who hate renewable energy and are as enthusiastic about coal power as Donald Trump is.

“I am not afraid to say the c-word, coal, coal, coal,” said National deputy leader Bridget McKenzie recently at a media conference addressing concerns about the drought afflicting Australian farmers. At this conference that also featured Nationals leader Michael McCormack, Resources minister Matt Canavan and agriculture leader David Littleproud, McKenzie said she was proud of a government that champions coal, reports Reneweconomy.

Australia has suffered from a high level of power supply interruptions in recent years which the right tends to blame on intermittent renewables. However, Reneweconomy has repeatedly shown that these accusations are misguided. (See also for example this article on Energy Post.)

In this latest article the authors show that most blackouts are caused by distribution interruptions that are unrelated to generation:

Ironically, the Australian government, like Trump, despite any free-market rhetoric, fully intends to intervene in the market to prop up coal power. “The Coalition will also focus on prices, and it will do this through an extraordinary level of government intervention in the market”, notes Reneweconomy. “At least on installing a price cap, it is on the same page as the Labor Party.”

The government also intends to support coal by underwriting a certain level of “dispatchable generation”, much like Trump’s plan (so far rejected) to keep coal and nuclear power plants open to keep the electricity system “stable”.

Meanwhile, South Australia is going its own way, writes Giles Parkinson in another article on Reneweconomy. It is likely to source 100% of its electricity from renewables by 2025, according to an assessment by the Australian Energy Market Operator, which makes this prediction as part of its Integrated System Plan, its 20-year blueprint for the integration of renewables into Australia’s electricity grid.

“The prediction contrasts dramatically with the modelling prepared for the NEG [National Energy Guarantee] by the Energy Security Board, of which AEMO is a member”, notes Parkinson.

Here is what the electricity mix would look like:

Notable is the combination of solar with a relatively large amount of utility storage. Indian entrepreneur Sanjeev Gupta has recently shaken up the Australian energy market with plans for building up to 1 GW of solar and storage to power his steel works in Australia. Gupta has said he sees up to 10 GW of solar and storage built across the country, which will bring down energy costs to half of what they are now.

In the AEMO modelling, combined cycle gas generation effectively disappears from around 2024, notes Parkinson. Peaking gas and diesel plays only a minor role behind that – much less than storage. The projection is partly based on a new transmission link to New South Wales, called RiverLink.

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