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The Magazine

Fraunhofer Institute

Multimodal energy systems on the rise

Electricity, heat, gas, and transportation have long been separate energy domains. But bridging the divide is the key to both a successful and economically viable energy transition, says Clemens Hoffmann, director of the renowned Fraunhofer Institute for Wind Energy and Energy System Technology.


The Magazine: Why are multimodal energy systems, also known as sector coupling, so crucial for the energy transition?
Clemens Hoffmann: Wind and solar, by far the most important sources of renewables, provide more energy than we can immediately use. In the case of Germany, we are expecting at the end of the century to have an installed capacity in both wind and solar of 400 gigawatts, while the predicted consumption at that point will only be 80 gigawatts. On the other hand, there will be instances when there is not enough power available due to low winds or cloudy skies. To solve that problem, we have to make sure that we can store the energy from peaks we have, for instance, on windy January days. Over 100 gigawatts will be lost if the corresponding loads are missing. This is the gap multimodal energy systems have to fill.

What are the options?

Physics dictates a certain logic, and this is: First, use as much electric power as possible for powering electric cars. Then, use it to generate heat. Lastly, use power to produce synthetic fuels like hydrogen or methane. And don’t underestimate the capacity we need. Take cars, for example. If in Germany all 40 million cars were electric with a capacity of 30 kilowatt-hours each, the overall capacity would be more than 1 terawatt-hour. On a very windy day charging this fleet would be a matter of only five hours. So power to heat and power to gas are additionally necessary technologies. It is an absolute requirement to introduce these new electric loads; otherwise, we will not be able to grow renewable generation further.

Multimodality optimizes energy systems

Coupling of sectors enables utilities to optimize the energy system, choosing the most suitable pathway with regard to fluctuating renewable energy sources. Pathway (A) shows electricity transporting energy fast over long distances, i.e., in high-voltage transmission lines, while at its destination, a compression refrigeration system transforms power to cold, which can then be stored in a reservoir for later use. The same goal can be reached via pathway (B) by storing electricity in a battery or transforming power to heat and storing it in a reservoir before it is transported through long-distance heating lines to the point of consumption at the time of need.

Let’s talk about power to heat first. How important is the coupling of these two sectors?

It’s particularly important, because from the perspective of decarbonization, for many European countries at least, low-temperature heating is one of the largest sectors. In Germany alone, an equivalent of 1,500 terawatt-hours, more than a third of our primary energy consumption, goes into heating. To tackle this challenge, we have to do two things: We have to improve the heat insulation of buildings by a factor of four and couple the residual heating to the electricity sector.

How is that possible?
It’s the heat pump that does the trick by taking environmental heat from the ground to produce thermal energy. In effect, that means a lever of factor 4. There are only a few applications where you would want to avoid the capital investment needed and use direct heat instead. If you combine both effects, insulation and the heat pump, about 100 terawatt-hours instead of 1500 might be needed in the end to warm all our houses – stunning how little energy we might actually need to feed our total heat demand.

How far are we from reaching this goal?

With respect to the heat pump itself, we are already there. My own house has a heat pump that works perfectly. However, both heat pumps and storage could benefit if applied to more than just a single house, e.g., to whole quarters. That would improve the volume surface ratio and also include the introduction of district heating, or pipes connecting large storages and households, on rather low temperature levels between 10 and 30 degrees Celsius. The technology would be today’s, but the additional benefit lies in the system approach, also with regard to long-term investments.

Are there already relevant business cases?
The business cases are almost viable, despite the fact that houses often are very inert assets and you need ground drilling to install most heat pumps. However, it will be very attractive and straightforward once you have a higher penalty on CO2 output, and flexible power tariffs, which allow you to buy cheap electricity at any time of the day. With these regulatory measures, we’ll see a very quick opening of the market. That’s basically true for all multimodal energy systems: There is no natural advocate for the atmosphere, so fitting regulation has to be introduced. We do not need strong support anymore. The break-evens are already very close.

Can we be friends with the conventional sector? To a lot of people’s surprise, the answer is: Yes, we can.

Have power-to-heat systems already been successfully installed?

We have one very interesting example in Zurich, where two installations running on 10 degrees Celsius have been installed in the city and on the university campus. We discussed with energy suppliers who already run their own district-heating network, but those run at higher temperatures for the time being. That can be changed once assets have been written off in two decades or so, and then the existing infrastructure could be used for a new purpose.

In some regions of the world, producing cold is much more important than heat – could that also be done with the same technology?

We are currently constructing our new headquarters in Kassel, and we are planning an autonomous heat source, which is a slush of water at the phase barrier at 0 degrees. That means it should never freeze but also never melt. In wintertime, you extract the heat; in summer, you operate the other way round and use the temperature difference to cool the building. This is a solution for a four seasons country where you can use one season to prepare for the next. For regions in the world with a permanent cooling need, you would most certainly use solar and go through machine cooling. But if you tapped a source with lower temperatures, like ocean water, you again could use a heat pump to lever, and you would end up using solar power to cool.

We talked about mobility earlier – how important is its role in the field of multimodal energy?
Mobility certainly is a large piece of the cake, but to decide how to decarbonize the traffic sector, you have to look closely into the details of car use. Our logic is that half of the traffic is short-distance driving that could easily be electrified. The other half is long-distance, lots of it with trucks and other heavy-load vehicles. Even those could be electrified in a kind of trolley system connected to an overhead line. We are already running tests with some car manufacturers on some specially prepared highway stretches, so this is not science fiction. Another option would be synthetic fuels, like hydrogen or methane.

How can electric power be transformed into gas?
Electrolyzers are used to produce Hydrogen, and they have been used for a hundred years. Currently, Siemens is further advancing the system with its PEM technology. Electrolyzers can even be installed in large production units, say the 100-megawatt range, where they will finally have to be used. If you produce these massive amounts of hydrogen, however, you may eventually have to build new infrastructure to deploy it. An alternative would be to use hydrogen and CO2 to produce methane, which is the gas running inside the existing gas grid today. Some promote hydrogen, and it can be mixed into the gas grid to a certain extent; others – we at Fraunhofer, for example – say there is good reason to have methane in the gas grid.

The Fraunhofer DeMoTec test center allows for a hardware simulation of a 90 kVA grid connection.

How far away are we from using power-to-gas?
Electrolyzers are already in standard use, even in larger power plants. With respect to methanization, the basic process is very old, but for this application’s large-scale production, there are still a lot of technological options to be tested. However, we think it is the right time to enter because we see this as a deployed technology in some 20 years ahead, especially with regard to the huge storage capabilities of the existing gas grid.

Talking about the gas grid – how compatible are all these multimodal energy systems with the conventional power sector?
A question I am frequently being asked is this: Can we be friends with the conventional sector? To a lot of people’s surprise, the answer is: Yes, we can. Conventional power plants today will be the balancing power plants of the future. There are very strong reasons to assume that balancing should be centralized: for cost reasons, and also for electrical control reasons. So we need them. Certainly, there will be a change of fuel. Instead of carbon fuels, synthetic gas will be used, which means that in a gas-fueled power plant, everything is already in place. Substituting natural methane with synthetic methane really is nothing. And there is another question: When you want to synthesize methane, where does the CO2 needed for the synthesis come from? I think that you can run the whole process in a closed cycle. You use the CO2 coming out of a gas-fired power plant and store it on-site for the next time you need to synthesize methane. In that regard, gas-fired power plants will be a necessary, integral part of the scheme. Yes, they only have to operate 1,000 hours a year, and you have to devise a business case for that. But that will not be a large problem if the political will is there.

Why should a utility invest in multimodal energy systems?
Because they will come. The advocates of energy system transformations worldwide, certainly after the Paris Agreement, will force systems to change. But stakeholders in the energy industry as well as in politics will have to agree on the way to go. Presently, we are making decisions going the wrong way. We endorse coal, for instance, rather than gas. At the same time, we see a lot of stakeholders who are surprised that things they thought would never happen are happening today. Many of those companies now come to us and ask for advice.

How important is digitalization in making sector coupling a success?
Digitalization is simply indispensable. If I owned a heat pump, I would want to have an optimized price mechanism, especially if I have a huge storage of some 10 cubic meters or more. Smart energy management systems will take care of heating water whenever power is at its cheapest, and this will be assured by connections to a prognosis and a market server. Having every prosumer making business with anyone, anytime through money transfer mechanisms based on technology, e.g., blockchain technology, is another prerequisite for optimized processes. And it goes without saying that grids should be smart. Wherever power lines are laid today, glass fiber is already there – and it simply does not make sense to have one without the other.

The energy transition? It’s an attractive investment with a guaranteed return.

You state that the cost of the energy transition will not be a problem.
To me, it is one of the biggest surprises when people talk about the high cost of the energy transition. The opposite is true: It’s an attractive investment with a guaranteed return. We observed lately that large institutional investors like pension funds have a problem finding investment assets producing the legally required return of 2.65 percent, because even state bonds don’t meet that goal anymore. Renewable infrastructure, however, guarantees these returns.

So why don’t investors go for it?

First, it has to do with communication: There is a certain polemic in saying the energy transition costs so much, because for any businessman, it is not cost that matters, but profit – which is the difference between cost and revenue. Second, it has to do with volumes. At our latest symposium, I asked investors about their need to invest in the energy transition. And they said the volumes are not yet large to be relevant. However, they could be: according to our calculations, we see the need of a €40 billion investment each year for renewable infrastructure in Germany alone. For the global market, we can easily add a factor of between 10 and 30. And because investors can go foreign, they will do it. Important to them is legal security, the risk calculation they will make for themselves. Investors love huge numbers; as long as the legal framework stays stable, the money will flow.

In the case of Germany, the legal framework has recently changed.
We were already reaching levels of installation deemed to be necessary for a successful transformation, around 10 gigawatts per year for both, wind and solar. That would have brought us toward our climate goals, but in 2012, the legislation was changed and the numbers plummeted so far that without another change, we won’t reach the goals we set ourselves for the end of the century. The interesting part about this is that many Asian countries have nevertheless started copying our approach. They take us more seriously than we do ourselves. And not only Asia – the whole rest of the world is observing very closely what we do in Germany.

Marc Engelhardt reports from Geneva on the UN and business news.
Picture credits: Bernd Schumacher