ENERGY SUPPLY IN TIMES OF ECONOMIC DOWNTURN:

A QUEST FOR SUSTAINABILITY

Laboratory of Heat Transfer and Environmental Engineering Department of Mechanical EngineeringAristotle University Thessaloniki, Greece

Agis M. PapadopoulosProfessor Dr. – Ing.

agis@eng.auth.gr

Energy policy: A delicate and dynamic balance

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Security of Energy Supply

Competitive Energy Prices Environment and Sustainability

Energy Policy

Energy Policy, Engineering and Energy Economics

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Providing answers to a series of questions:

• Which energy resource to use• For which end use• With what sort of energy conversion systems • At which financial cost• With what environmental consequences• On what time scale for the effectuation of decisions• At which political cost

In other words:Long-term Energy Planning

Energy investments: Treat them with care

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Main characteristics of Energy Investments:

1. Capital intensive investments: Power generation plants are two to three times more intensive than manufacturing industries.

2. Asset specific investments: They cannot be used for anything else than they are planned.

3. Long life of the investment plan: A humble solar collector field lasts 15 years, a gas-fired power plant 25, a hydro power plant 50 years.

4. Long lead times: A gas fired power plant needs 2-3 years, a nuclear plant 8-10 years.

5. Big size: Economies of scale lead to “Big is beautiful”.

Energy investments: Treat them with care

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Questions that have to be answered

1. Whether the project will be undertaken by the public or private sector.

2. The fiscal impact of the project.

3. The return and equity of cost recovery.

4. The environmental impact of the project.

5. The political and geopolitical uncertainty factors

6. The risk of technological obsolesce

7. The societal attitudes

Energy systems, energy sources and logistics

The energy system of the 20th century

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Energy systems, energy sources and logistics

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The oil system

1. Pumping (88 mn bbl/d oil, Nov. 2011)2. Transport with pipelines to harbors. 3. Storage in harbors4. Transport by ship to oil-refineries5. Storage in oil-refineries6. Processing in oil-refineries (4.600 mn t, Nov.2011)7. Storage of final products8. Transport to wholesale-dealer9. Storage10. Transport to petrol stations11. Storage 12. Retail selling to the final user

Energy systems, energy sources and logistics

The oil system

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Energy systems, energy sources and logistics

The oil system: Political and geopolitical risks

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Energy systems, energy sources and logistics

Power generation

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Energy systems, energy sources and logistics

The natural gas system

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Energy systems, energy sources and logistics

The oil and the natural gas system: Political and geopolitical risks

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Energy systems, energy sources and logistics

Renewable Energy Sources: Transmission on a big scale

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Energy systems, energy sources and logistics

Renewable Energy Sources: Transmission on a regional scale

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Energy systems, energy sources and logistics

Renewable Energy Sources: Transmission on a local scale

Windfarm Felixstowe, England

E.ON (D),Dong Energy (DK)Masdar (Abu Dhabi)

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Energy systems, energy sources and logistics

Renewable Energy Sources: Application on a local scale

SEPEDIC, Sustainable Energy Project for the Economic Development of Isolated Communities

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Energy systems, energy sources and logistics

Renewable Energy Sources: On the smallest scale

The application

Biomass fireplace:

• Efficiency 70%

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Storage tank for hot water:

• 9.000 lt

• Used also for washing

machines

PVs and accumulators:

• For residential use of up

to one week

• Small vehicles

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The application

The application

The cost factor:

365.000 €

160 m2

2.280 € / m2

With basic interior

equipment

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Sustainability

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The «Shots» by PACALA & SOCOLOW (2004)

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14

2

1950 2000 2050 2100

Car

bon

em

issi

ons

(Bn

ton

nes

/ ye

ar)

7 «Shots»

1. Energy conservation

2. Change of fuels

3. Carbon storage

4. Renewables

5. Nuclear power

6. Forests’ management

7. CH4 managementReaction

320

380 470

500

500

850

Source: L.Papagiannakis, 2006

Security of energy supply: Energy dependency

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-40% -20% 0% 20% 40% 60% 80% 100%

Cyprus Ireland

Italy Portugal

Spain Belgium Austria Greece

Latvia Hungary

Germany Finland

EU27 France

Romania United Kingdom

Poland Denmark

Security of energy supply: Energy poverty

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In the UK the Warm Homes and Energy Conservation Act 2000 stated that fuel poverty should be eradicated "as far as reasonably practicable" by 2016.

Fuel poverty fell from 5.1 million households to 1.2 million households between 1996 and 2004.

It has more than trebled since and the "fuel poverty gap“ increased by 50% to £1.1bn as a result of rising fuel prices.

Commissioned by the government, the Hills Fuel Poverty Review found that by the end of 2011, 4.1 million households are expected to be in fuel poverty.

2,700 people will perish this winter as a direct result of being fuel poor.

Concluding remarks

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• We need less and cleaner energy; there are limits to taxation

as an energy policy tool.

• Decisions made now will have a full impact by 2020.

• Investments in energy systems are capital intensive ones, tying down precious

funds for decades.

• International energy trade has growing significance.

• International and national infrastructure is getting more and more sophisticated.

• Transport, transmission and storage is playing a crucial role in terms of time,

space and versatility.

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Working on a pipelineTaking from the greedy, giving to the needy

Depeche Mode, Pipeline, 1983

Energy & Logistics