Europe 2040 – combined gas and electricity network scenarios

Europe’s gas and electricity TSOs have developed joint scenarios on which to base future network planning.
Published: Thu 03 May 2018

For the first time, Europe’s gas and electricity transmission system operators (TSOs) have produced joint scenarios for the energy system up to 2040.

Indicative of the need to more closely integrate the sector, these will now form the basis for planning the development of the respective networks.

“We see these transparent scenarios as a sound basis for our network development plans as well as for any party wishing to perform their own analysis of future policies, market designs or technologies,” says Jan Ingwersen, General Manager of the gas TSO organisation ENTSOG.

2040 decarbonisation scenarios

The three scenarios, which have been widely consulted, offer markedly different possible paths towards a low-carbon energy system in line with European Union (EU) targets.

In the Sustainable Transition scenario, climate action is achieved with a mixture of national regulation, emission trading schemes and subsidies. Quick and economically sustainable CO2 reduction is sought by replacing coal and lignite by gas in the power sector.

Gas also displaces some oil usage in heavy transport and shipping. The electrification of heat and transport develops at a slower pace than other scenarios. Reaching the EU CO2 reduction goal (80-95% in 2050) requires rapid development during the 2040s to be achieved through increased technological adoption or evolution.

In the Distributed Generation scenario, significant leaps in innovation of small-scale generation and residential/commercial storage technologies are a key driver in climate action. Prosumers are placed at the centre. Smart technology and dual fuel appliances such as hybrid heat pumps allow consumers to switch energy depending on market conditions. Electric vehicles see their highest penetration with PV and batteries widespread in buildings. These developments lead to high levels of demand-side response available. Biomethane growth is strong as connections to distribution systems grow utilising local feedstocks.

Scenario building framework for TYNPD 2018 – renewables share of demand for electricity and gas

In the Global Climate Action scenario, global methods regarding CO2 reductions are in place towards full speed decarbonisation. The emphasis is on large-scale renewables and even nuclear in the power sector. Residential and commercial heat become more electrified, leading to a steady decline of gas demand in this sector. Decarbonisation of transportation is achieved through both electric and gas vehicle growth. Energy efficiency measures affect all sectors. Power-to-gas production sees its strongest development within this scenario.

Network scenario takeaways

While each scenario has its own outcomes, some general trends are apparent.

In the 2040 timeframe electricity demand is up by approximately 20% from 3,400TWh in 2015 to between 4,000-4,5000TWh. Conversely annual gas demand is either in line with or lower than the current 5,000TWh demand average.

The growth in electric vehicles is exponential throughout the timeline in all scenario paths, reaching between 50,000 to 80,000 by 2040. Heat pumps and hybrid heat pumps also show growth although the extent is scenario dependent.

On the supply side the general trends are a reduction in nuclear, while the levels of hydro and pumped storage remain relatively constant. Wind and solar grow as coal and lignite decline. By 2040, renewables are projected to grow to supply 65% to 81% of demand. Moderate growth is projected in the 2020-2030 decade followed by more significant growth in the 2030-2040 decade.

Biomethane developments also are strong in all scenarios reaching up to 13% of green gas supply by 2040, while power-to-gas could grow up to 2.5%.

“Framing uncertainties is key for policy makers, investors and many businesses,” comments Laurent Schmitt, Secretary General of the electricity TSO organisation ENTSO-E. “Our scenarios are exactly about that. This is why we want to take initiatives to increase their usability as we see their relevance for many other parts of society.”

The two organisations ENTSOG and ENTSO-E say that these scenarios bring key improvements over earlier scenarios, including improved modelling of energy consumption.

The next version of the Ten Year Network Development Plans is due to be published for consultation in Q3 of 2018. A 2040 vision of Europe’s electricity networks were released recently by ENTSO-E, which also will provide input to the next TYNDP