The Greek Energy Roadmap to 2050

The energy sector constitutes a cornerstone for economic development and has either direct or indirect impact on every sector of the economy. Therefore it becomes obvious that the energy planning at national level is an important tool towards the implementation of the development policy of a country, with a tremendous impact on national and not only economic activity.

The present energy plan refers to the basic guidelines of the national energy strategy towards 2050, without adopting a strictly defined scenario for the evolution of the energy system.

The main feature of the Greek energy mix is the high level of use of fossil fuels both for electricity production and energy consumption across all sectors. The use of lignite has been a strategic choice, despite its environmental impact, due to the fact that it is a domestic fuel. Nowadays, the national energy balance is dominated by imported hydrocarbons (mainly oil products and less by natural gas).

The adoption of European common policies on the energy sector, particularly in relation to the requirements for reducing greenhouse gas emissions, has already affected the Hellenic energy system. In recent years an increasingly growing penetration of Renewable Energy in both electricity generation and end use energy has been achieved, while measures and policies aiming to achieve energy savings have been already implemented.

For the period until 2020, the European Energy Policy focuses on accomplishing specific individual targets for all member states. The Greek Government, by adopting (Law 3851/2010) specific developmental and environmental policies, proceeded with the increase of its national goal (from 18% to 20%) regarding the participation of renewables in gross final energy consumption. This objective is composed of 40% participation of RES in electricity production, 20% in heating and cooling and 10% in transport.

Regarding electricity, the national targets for 2020 are expected to be met with the development of approximately 13,3 GW of renewables. The installed capacity and the licensing process show that Greece is on track to achieve its national objectives.

Starting with the first Action Plan for Renewable Energy, the National Energy Strategy Committee elaborated an in-depth and long term analysis of the Greek energy system in order to propose an Energy Road Map of Greece for the period 2020-2050.

Reducing dependence on imported energy, maximizing the penetration of renewables, achieving a significant reduction in emissions of carbon dioxide (CO₂) by 2050, and reinforcing the protection of final consumers are the main pillars of the national energy planning. Simultaneously, zero use of nuclear energy and the very limited use of Carbon Capture and Storage technology (CCS) are in turn, key options for the abovementioned planning.

Bearing into consideration the EC guidelines for the period 2020-2050, as well as the development of a core set of parameters (economic activity per sector, international fuel prices, CO₂ prices, lignite use level, etc.) three scenarios were examined in order to specify and evaluate alternative measures and policies for the fulfillment of national and European targets.

The Scenario "Existing Policies" (Scenario EP) assumes a conservative implementation of environmental and energy policies, anticipating on the one hand a moderate level of CO₂ emissions reduction by 2050 (40% compared to 2005), and on the other moderate penetration of RES and energy saving.

The Scenario "Measures Maximization RES" (Scenario MEAP) assumes maximization of RES penetration (100% in electricity generation), so as to reduce CO₂ emissions by 60% -70% with simultaneous energy saving in buildings and transport. The same scenario is examined under the hypothesis of imported electricity which will result in cost savings in electricity sector (Scenario MEAP-a).

The Scenario "Minimum Cost of Environmental Measures" (Scenario PEK) has the same assumptions as the Scenario MEAP relating to CO₂ emissions but estimates the share of renewables in the energy mix so as to ensure the minimum cost. A variation of this scenario, considering the inclusion of CCS is also considered (Scenario PEK-a).

The picture of the future energy system as indicated by the two basic energy policy scenarios (Scenarios MEAP and PEK) can be summarized in the following 10 points:

1. Reduce greenhouse gas emissions by 60%-70% by 2050 in relation to 2005.

2. 85%-100% electricity generation from RES, using all commercially mature technologies.

3. Total penetration of renewables in gross final energy consumption by 2050 at a rate of 60%-70%.

4. Stabilization of energy consumption due to energy saving measures.

5. Relative increase in electricity consumption due to electrification of transport and greater use of heat pumps in the residential and tertiary sectors.

6. Significant reduction of oil consumption.

7. Increased use of biofuels in transportation sector at the level of 31% to 34% by 2050.

8. Dominant share of electricity in short-distance passenger transport (45) and significant increase in the share of stable track public transport.

9. Significantly improved energy efficiency for the entire building stock and a large penetration of RES in buildings.

10. Development of decentralized production units and smart grids.

The achievement of national energy goals in the medium (2020) and long-term (2050), requires the preparation, adoption, implementation and evaluation of a set of energy policy measures.

Policies, measures and interventions in energy consumption are taking into consideration the potential for energy saving and energy efficiency improving that exist in all final energy consumption sectors. The sectors with the greatest potential for energy saving are buildings, transport and industry.

Measures planned to be implemented concerning inter alia:

· energy certification of buildings,

· energy upgrade of existing buildings,

· coverage of all energy requirements of new buildings by RES,

· development of market mechanisms, such as energy services companies and white certificates,

· electrification of transport.

In industry, the savings will result from the reduction in electrical consumption and thermal uses and the implementation of CHP (Combined Heat & Power).

The energy policy measures in the electricity sector are related to ensuring the energy supply and functional electricity market, reducing greenhouse gas emissions, and concern in:

· infrastructure (network expansions and connections),

· the appropriate modification of the energy mix,

· flexible and decentralized energy production,

· the expansion of smart grids,

· the rationalization and acceleration of licensing process covering RES,

· the availability of appropriate support mechanisms for RES investments and long-term integration into the competitive market.

The first critical finding of this analysis is that the prospect of existing policies (Scenario EP) does not lead to the achievement of objectives (i.e. reducing CO₂ emissions by 2050, more economical development of the energy sector). Instead, the new energy policy scenarios (Scenarios MEAP and PEK), where the high penetration of renewables in gross final energy consumption dominates, achieve deep CO₂ emission cuts (by 60% to 70% compared with 2005) while imported energy and country's energy dependence from imported fossil fuels is reduced.

Electricity generation cost follows a declining trend after 2030 while the increased use of renewables and the limited use of fossil fuels ensure further cost reductions by 2050.

At the same time the attraction of investment capital and capital leverage, so that the proposed technical changes to the Greek energy system be implemented, is a particularly important opportunity for local economic development in various sectors of economic activity (e.g. the energy sector, construction sector, commercial sector, etc.)

In any case, what is obvious by the present report is that the national energy system has the potential to differentiate significantly over the next years, fulfilling the commitments of the European energy policy while providing security and lower energy cost to the final consumer.