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TIR-CG_Luxembourg-Final-Report_Long-Version TIR-CG_Luxembourg-Final-Report_Long-Version
Third Industrial Revolution Consulting Group Modeling Supply & Demand Using the urban energy system modeling tool, KomMod, a cost-optimal structure of the target energy system in a temporal, highly-resolved simulation was calculated 36 in a manner that covers all energy sectors, including electricity, heating, cooling, and local transport energy, including their interdependencies. Figure 3: Energy Demand Components Included for the Energy Supply Optimization This modeling, which accounts for the energy demand components shown in Figure 3, shows that given Luxembourg’s technical potential, it is feasible that the country could produce 100% of its renewable energy domestically. The Energy Working Group set a goal of producing a majority of its energy – between 50% and 100% - with domestically produced renewables. With this in mind, the TIR Consulting team ran three Ambitious Energy Efficiency (AEE) potential scenario models with 50%, 70% and 100% of the energy generated domestically by renewable energies. While the scenario modelling found that producing 100% of its energy domestically would be technically feasible, a scenario where only 70% is locally generated and 30% imported is far more cost-effective, as shown in Figures 4 and 5. However, producing 70% of Luxembourg’s renewable energy needs domestically by 2050 may be a conservative figure. As 36 Input to the Energy Sub-Report, ‘Results of Modelling the Energy System of Luxembourg.’ Gerhard Stryi-Hipp, Fraunhofer ISE, 27 July 2016. 32
Third Industrial Revolution Consulting Group mentioned in other sections of the Third Industrial Revolution Strategy Study, the reduction in the fixed cost of solar and wind generation has been on an exponential curve for 20 years (for example, in 1977, the cost of generating a single watt of solar electricity was 76 dollars, and by 2017 the cost is projected to be 55 cents/Watt 37 ). The fixed costs in generating renewable energy will continue to plunge on an exponential curve while the marginal costs remain near zero. Moreover, the fixed costs of renewable energy storage technologies are also declining and will be increasingly cost-effective in managing intermittent solar and wind energy over the course of the next 35 years. In addition, as the Third Industrial Revolution Internet of Things infrastructure continues to evolve and become increasingly interoperational, additional exponential curves will emerge, dramatically increasing aggregate efficiency and productivity, while dramatically reducing ecological footprint and accompanying external costs, making domestically produced solar and wind even more cost effective and attractive. For all of the above reasons, it is possible that Luxembourg will find it cost-effective to increase the domestic production of renewable energy beyond the 50% minimum benchmark set out in our energy modelling scenarios to 70% or more. Figure 4: Installed Renewable Energy Capacity to Achieve 70% Electricity Self-Generation for the AEE Demand Scenario 37 See: http://www.nwclimate.org/news/solar-panel-efficiency-from-solarcity/ 33
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Third Industrial Revolution Consulting Group<br />
Modeling Supply & Demand<br />
Using the urban energy system modeling tool, KomMod, a cost-optimal structure of the target<br />
energy system in a temporal, highly-resolved simulation was calculated 36 in a manner that<br />
covers all energy sectors, including electricity, heating, cooling, and local transport energy,<br />
including their interdependencies.<br />
Figure 3: Energy Demand Components Included for the Energy Supply Optimization<br />
This modeling, which accounts for the energy demand components shown in Figure 3, shows<br />
that given Luxembourg’s technical potential, it is feasible that the country could produce 100%<br />
of its renewable energy domestically. The Energy Working Group set a goal of producing a<br />
majority of its energy – between 50% and 100% - with domestically produced renewables. With<br />
this in mind, the TIR Consulting team ran three Ambitious Energy Efficiency (AEE) potential<br />
scenario models with 50%, 70% and 100% of the energy generated domestically by renewable<br />
energies. While the scenario modelling found that producing 100% of its energy domestically<br />
would be technically feasible, a scenario where only 70% is locally generated and 30% imported<br />
is far more cost-effective, as shown in Figures 4 and 5. However, producing 70% of<br />
Luxembourg’s renewable energy needs domestically by 2050 may be a conservative figure. As<br />
36 Input to the Energy Sub-Report, ‘Results of Modelling the Energy System of Luxembourg.’ Gerhard Stryi-Hipp,<br />
Fraunhofer ISE, 27 July 2016.<br />
32