If it was not possible to accelerate the development of renewable energy sources in Europe, the prices of carbon dioxide emissions allowances would rise by 80%. Within a decade, which will also translate into an increase in electricity prices. EU countries will face larger increases if Poland implements its coal subsidy scheme. Unblocking investments in renewables will have the opposite effect – electricity prices will finally begin to fall. Those are the conclusions of the latest Aurora Energy Research report.
- Aurora Energy Research, an organization founded by Oxford University economists, has analyzed the impact of different RES development speeds on the price of carbon dioxide.
- The rapid development of renewable energy will stabilize and even reduce wholesale electricity prices in Europe by 2030 – in Germany they will fall by 14%, and in Poland by up to 26%. Compared to the first half of 2021
- On the other hand, stagnation in green investments will increase prices: in Germany by 31 percent, and in Poland by 14 percent.
- The prospect of Polish coal subsidies is no longer just a problem for Poles, it’s starting to weigh on electricity consumers across the European Union – experts alert
- More such information can be found on the home page of Onet.pl
For the study, which was commissioned by the European Climate Foundation, Aurora developed a new model that simulates The development of the energy sector The industry is based on lower emissions budgets and other tools, such as subsidies for renewable energy sources or contracts for difference for carbon dioxide emissions. According to the authors Achieving the ambitious EU climate targets set out in the Fit for 55 package depends in large part on the emissions trading system.
– By reducing the number of carbon dioxide emissions allowances, the emissions target is automatically feasible – explains Casimir Lorenz, Aurora Energy Research Director. – However, this does not guarantee that the electricity markets in European countries will develop in a way that will also maintain the competitiveness of the industry in the long run. That’s because, depending on how the energy mix evolves, both the carbon dioxide price and wholesale electricity prices can be very different – and both are important to companies.”
Aurora experts developed two scenarios. The first is He is pessimistic and assumes that European countries will not be able to remove existing obstacles to the development of renewable energy – For example, by allocating too little land to solar and wind energy, maintaining strict distance rules for windmills and failing to streamline green investment permitting processes.
– In this case, we will need more gas-fired power plants in the coming yearsTo meet growing electricity demand while coal will be phased out, explains Linus Beer, senior analyst at Aurora Energy Research. – As a result, energy systems in general will contain more fossil fuels and the European price of carbon dioxide will rise by about 80%. By 2030, This will have similar consequences for wholesale electricity prices in individual countries. For example, Poland should take into account a 14 percent price hike, Italy 20 percent, and Germany 31 percent. Beer estimates.
quotes CO2 emissions allowances Already this year, they made a huge leap. Prices at auctions on the German EEX Exchange at the end of September this year reached a record level of 65 euros / ton. Meanwhile, in September 2020, the rates were less than 30€/ton.
The authors of the analysis caution against this The increase in electricity prices will have a significant impact on the competitiveness of European industry. but that is not all. – More gas-fired power plants also means more gas imports, thus increasing the EU’s geopolitical dependence on gas suppliers – says Lorenz.
This is not a local problem
The situation may worsen if, in addition, Poland decides to achieve the coal production targets included in the state energy policy until 2040. The Polish document assumes that in 2030, it is assumed 37-56 percent of electricity We will produce from charcoal. This means that the annual consumption of black fuel will reach 14.7-26.4 million tons during this time. The Polish government wants to negotiate in the European Commission the approval of subsidies for both coal-fired power plants and Polish mines – until 2049.
Aurora analysts appreciated it The implementation of Polish plans could translate into an increase in the price of carbon dioxide emissions allowances by another 20 percent. Above the levels assumed in the pessimistic scenario. The analysis shows that this will require significant direct support for the largely unprofitable coal production.
– The report points to a seldom discussed dimension of the debate about moving away from coal in Poland. In addition to toughening climate policy goals, Maintaining significant energy production from coal even in one EU country will lead to a significant increase in the allocation rates in the entire EU emissions trading system already in this decade. The prospect of subsidizing Polish coal-fired power plants is no longer just a problem for taxpayers and energy recipients on the Vistula River, but is also beginning to affect households and industry in the rest of the European Union – comments Alexander Schneijoki, director of the “Climate and Energy” program at WiseEuropa.
He points out that coal combustion at Polish power plants would reduce the already rapidly shrinking pool of provisions in the European Union (ETS). – Less likely that EU institutions will agree to special treatment for the Polish coal sector – Śniegocki claims.
green change
In the second scenario, Aurora experts assume that EU countries will remove obstacles on their way to RES . development and aligning their goals with the EU’s 55% carbon reduction plan. Until 2030 – If EU countries speed up the development of renewable energy sources, they will not have to build many gas power plants – says Bear. – This will stabilize the CO2 price in the ETS system at the current level. As a result, wholesale electricity prices will stabilize and fall in some countries, Beer says.
for example In this scenario, Poland can count on a 26 percent drop in electricity prices. Compared to the first half of 2021, before the last price increase, Italy increased by 22 percent and Germany by 14 percent.
The report’s authors also point out that the rapid development of wind and solar energy is not only repelling increases in electricity prices, but also It will reduce the risk of the EU industry fleeing from the EU.
– together The natural gas over-entry trap should be avoidedwhich are also burdened with the costs of carbon dioxide emissions. Implementation of such a scenario should be in the interest of industrial sectors in which green technologies have not yet matured and commercialized as in the energy sector, says Bowie Vrubel, president of consultancy Jet Brussels.
Polish energy engineers point out, however, that the development of renewable energy sources may also contribute to the development of gas power. At least until large-scale energy storage becomes available. This is because the operation of an increasing number of green facilities operating only in favorable weather conditions requires a high degree of system flexibility – eg, significantly reducing the capacity of conventional power plants at the time of peak production in solar and wind power plants. Coal power plants do not have this flexibility, but gas power plants do.
We hope to lower prices
As investment bank Goldman Sachs points outThe development of renewable energy sources will reduce electricity prices. According to the foundations, increasing the share of energy from renewable sources will reduce electricity prices in Europe by about half by 2030.
According to the institutions, this effect will be supported by the normalization of natural gas prices in the coming years, and EU economies will benefit from lower energy prices until at least the middle of this century. In 2030, the cost of 1 megawatt-hour of energy is expected to be 50 euros, and in 2050 – 47 euros.
According to Ember, the monthly averages for September this year Wholesale energy prices in Poland It reached €102/MWh and was still one of the cheaper European markets. For example, in Ireland at that time the average price was 195.6 € / MWh, in Italy 158.8 € / MWh, and in Spain 156.4 € / MWh.
Echo Richards embodies a personality that is a delightful contradiction: a humble musicaholic who never brags about her expansive knowledge of both classic and contemporary tunes. Infuriatingly modest, one would never know from a mere conversation how deeply entrenched she is in the world of music. This passion seamlessly translates into her problem-solving skills, with Echo often drawing inspiration from melodies and rhythms. A voracious reader, she dives deep into literature, using stories to influence her own hardcore writing. Her spirited advocacy for alcohol isn’t about mere indulgence, but about celebrating life’s poignant moments.
![This is the retirement age in Poland – that’s for sure. We also have a pension index forecast for 2024 [7.05.2023]](https://d-art.ppstatic.pl/kadry/k/r/1/7d/fa/6449401914c5c_o_original.jpg)
