Richard Sarsfield-Hall is the Director of the energy division of international consultancy firm Pöyry. In our interview with him, we discussed the findings of Pöyry’s recent report, Fully Decarbonising Europe’s Energy System by 2050, which argued that overlooking decarbonised gas technologies could cost Europe over a trillion Euros by 2050. You can download the report here.
“Actually what we need to be talking about is how do we decarbonise, and how do we get zero-carbon gas to be an integral part – and I do mean integral.”
How many years have you been coming to Flame now?
I’ve been coming for nine years in a row, so definitely a Flame die-hard.
And a good year so far this year?
Absolutely excellent. Very good, very good.
You’ve been presenting one of your reports here?
Absolutely. So we’ve been doing a major study looking at how you fully decarbonise Europe’s energy system – and by energy that means transport and heat as well as power. Everyone tends to think about power but they forget about transport and they forget about heat. Now we did a major study looking at how the integration of all of those can lead to a fully decarbonised system. So hopefully something that policy makers like because it gives them the answer they want, but a good challenge to the industry as well in terms of the role for gas into the future.
So tell me what you came up with then – was it just one answer, or several different scenarios, or…?
So we did two major pathways, one of which is where we allowed what we called zero carbon gas – so that’s opportunities like hydrogen, biomethane, carbon capture and storage – and allowed those to compete with all the other technologies which are out there. And then we did an all-electric one where we constrained those, and said that the zero carbon gas isn’t allowed, and asked can you still decarbonise heat and transport as part of that solution.
And what was your answer?
The answer was that surprisingly renewable electric can be done; but you’d need a lot of new nuclear in particular, but if you actually put zero carbon gas into the solution, then actually that comes out with a better alternative that’s cheaper. You actually get more renewable energy in the power system for example, but you can get hydrogen in transport, you can get hydrogen replacing natural gas where it’s being used in heating people’s homes, carbon capture and storage for helping to decarbonise industry. And these are the areas where the latter two about how you decarbonise homes and how you decarbonise industry is the really big challenge. And if you don’t allow zero carbon gas in that, that’s going to be even more expensive to consumers, and it’s going to restrict the choice that you’ve got to get there.
It does sound great on paper that it can be done – but there’s a lot in there. So at the top of your list what are the biggest challenges to getting to that end point?
So we would say that the biggest challenges are that there’s too much “not in my back-yard” going on with policy makers at the moment, as well as the public perception-
I was going to say, both policy makers and public.
Both
So this is because of short term election cycles and the like.
Elements of that, but also an element of people saying “right, we don’t want nuclear, we don’t want carbon capture and storage”, without understanding that if you preclude these, then the objective of full decarbonisation – which most people say is not only laudable but an absolute must – is then constrained to the point where you can’t actually get there. I think sometimes people have to recognise that there’s a trade off on these things. Which is more important: full decarbonisation, or I don’t want nuclear, or I don’t want CCS? So trying to get that message across to people, that you can’t preclude things just because you don’t like them and still say I want this end game without having other consequences.
Just out of interest, you were putting together CCS and nuclear in the same sort of nimbyism – is that what you’ve found in your research?
Well we pick up on that. So when we talk to our clients, and when we talk to people about what’s going on, and we talk to policy makers, there’s definitely an element in some countries of either pro-nuclear or anti-nuclear. A lot of countries don’t seem to understand what CCS does or doesn’t do, and people will say “how does this work for industry and what do we have to do on this basis?” There’s a risk of people mixing things up, and they call different things like brown hydrogen, green hydrogen – all of which rather confuses the issue, when actually what we need to be talking about is how do we decarbonise, and how do we get zero-carbon gas to be an integral part – and I do mean integral. Because it becomes a destination and not a transition as part of it.
Right, okay. Everything that you’re talking about involves money.
Absolutely, yes.
I don’t know whether you’ve put figures on this?
So our analysis suggests that allowing zero carbon options gives you about a trillion Euros between now and 2050. A cheaper solution than if you preclude them and force things like nuclear to have to be part of the solution.
But does that include the costs of the infrastructure, the R&D – the whole thing?
Absolutely. So it includes the costs of replacing your boiler with a hydrogen boiler, upgrading the gas network to do that, making electric cars and fast charging, it includes if you put an air source heat pump into somewhere where you’ve got radiators and you need bigger radiators – all of those costs are there, and they are real, but surprisingly decarbonisation doesn’t cost as much more than you might expect because between now and 2050 everyone replaces their car, they replace their boiler, so actually if you make those not be so much more expensive – and an electric car shouldn’t be that much more expensive in the future than an existing fossil fuelled car – then actually it’s not as much more expensive as you think it is.
You’re talking about a very joined up policy. Very sort of top line thinking here. But there are obviously many very different industries underneath that – the transport, heating… So where do you see the individual challenges?
Well, first of all if you don’t look at a holistic approach – and that was criticised as a word – but if you don’t look at that then you miss some of the benefits that they can actually help support each other. They can be mutually supportive. So if you decarbonise transport by putting a lot of electric vehicles out there and say hydrogen vehicles, that actually gives a real benefit to the power network. Because then that that mean that people can charge at different points in time you don’t have to have a dumb system which means that the costs get too great. Actually then that flexibility enables demand now to balance intermittent generation, a real problem in Germany and other places where you’ve got negative prices. You don’t have negative prices any more, so actually the things can be mutually supportive, and what’s being missed at the moment is that people are thinking about how do I decarbonise electricity, how do I decarbonise heat, how do I decarbonise transport? And they’re not thinking actually that they can all support each other, rather than being left in separate buckets.
You’ve just said that you’ve got criticism earlier for using the word holistic – that I think came from the Dutch Green Party – saying that actually sometimes the word holistic was being used when there wasn’t a clear plan. I imagine you take some sort of umbrage with that?
No, I don’t take umbrage. I think what we’re trying to say with this study is that actually the more you look at it as an integrated solution, the more you realise that you have got to solve these things in parallel. So you need decarbonised transport at the same time as ensuring that the electric grid is expanded and made smart. These things have to be done in parallel, otherwise you’re going to get yourself to somewhere like 2040, and realise that you’ve left it all far too late, and you’ll never achieve decarbonisation by 2050.
