THE ENERGY INDUSTRY TIMES - JANUARY 2022
2
Junior Isles
Revised rules of the Trans-European
network for Energy (TEN-E) Regula-
tion have been introduced to support
the European Green Deal and look set
to provide a much needed boost for
hydrogen.
On December 14, 2021, the Euro-
pean Union’s Council, Parliament,
and Commission agreed in principle
on new EU rules for cross-border en-
ergy infrastructure and future Projects
of Common Interest (PCIs) under the
TEN-E framework. The agreement
comes after the European Commis-
sion tabled a proposal for renewing
the regulation in 2020, with an aim to
modernise the existing regulation and
fully align it with the objectives of the
Green Deal.
Key elements of the political agree-
ment include a strengthened frame-
work for the cross-border cooperation
to accelerate the implementation of
offshore grids as a key element of the
energy transition, a strengthened fo-
cus on infrastructure categories such
as smart electricity grids, a widened
scope to include hydrogen networks
as well as a mandatory sustainability
assessment for all eligible projects.
“Now is the time to invest in the
energy infrastructure of the future.
The revised TEN-E rules will allow
clean technologies to be plugged in to
our energy system – including off-
shore wind and hydrogen. We need to
update and upgrade now to achieve
the Green Deal’s goal of climate neu-
trality by 2050,” said Executive Vice-
President for the EU Green Deal,
Frans Timmermans.
The revised rules also bring new pro-
visions on support for projects con-
necting the EU with third countries,
Projects of Mutual Interest (PMIs), that
contribute to the EU’s energy and cli-
mate objectives in terms of security of
supply and decarbonisation.
The new rules came as the Interna-
tional Energy Agency (IEA) called for
more ambitious and concrete hydro-
gen policy efforts from governments
across Europe and beyond to bridge a
wide gap between the current market
trajectory and the projects needed to
meet net zero targets.
Speaking at the S&P Global Platts
Hydrogen Markets Europe Confer-
ence in late November, Jose Bermu-
dez, the IEA’s energy technology
analyst for hydrogen and alternative
fuels, said that under the IEA’s net zero
scenario, hydrogen demand of around
90 million mt/year in 2020 would
roughly double by 2030, with a six-
fold increase by 2050. However, un-
der current trends, the IEA expects the
market to reach just 105 million mt/
year by 2030, with most growth lim-
ited to traditional sectors, or to rise to
120 million mt/year by that date if
existing government pledges are met.
The EU has a target to produce 10
million tonnes of renewable hydro-
gen by 2030, though vast quantities
of new renewable power capacity will
be required.
Bermudez said carbon auctions and
contracts for differences could play a
potential role in developing the hy-
drogen market, but almost no such
schemes have come into force yet.
global coal red electricity genera-
tion takes place, coal power is ex-
pected to grow by 9 per cent in 2021
despite a deceleration at the end of
the year. In India, it is forecast to
grow by 12 per cent. This would set
new all-time highs in both countries,
even as they roll-out impressive
amounts of solar and wind capacity.
While coal power generation is set
to increase by almost 20 per cent
this year in the United States and
the European Union, that is not
enough to take it above 2019 levels.
Coal use in those two markets is
expected to go back into decline
next year amid slow electricity
demand growth and rapid expan-
sion of renewable power.
Last month Greece became the
latest country in Europe to an-
nounce a timeline for ending coal
red power generation.
Greece is to introduce its rst cli-
mate law, pledging to cut its reliance
on coal within six years as part of a
move to a carbon net zero economy
by 2050.
The law comes after the country
suffered devastating wildres this
year when summer heat soared that
was attributed partly to global
warming.
“The national climate law is of
historic importance . . . in order to
deal with the climate crisis and
achieve climate neutrality by 2050,”
said Kostas Skrekas, Environment
and Energy Minister.
The law foresees an intermediate
target of reducing greenhouse gas
emissions by 55 per cent by 2030.
As part of its plans Greece will
phase-out production of lignite, a
particularly polluting form of coal,
within the next six years. The deci-
sion will be reconsidered by 2023
with an eye to accelerating an exit.
Greece is one of the EU countries
that relies most heavily on coal for
energy and has been a laggard with-
in the EU in cutting emissions. Ger-
many has cut its emissions 38 per
cent from 1990 levels, according to
UN data, while Greece has cut its
emissions by less than 19 per cent
over the same period.
n Last year (2021) will surpass the
2020 record, with 290 GW of new
renewables capacity installed, de-
spite rising prices for some com-
ponents and transport, highlights
the IEA’s ‘Renewables’ report. Ac-
cording to the IEA, which revised
and raised its projections, 4800
GW of installations will be avail-
able by 2026, which means 60 per
cent more than in comparison with
2020 and the equivalent of the cur-
rent power capacity from nuclear
and fossil energies together. Pho-
tovoltaics will account for more
than 50 per cent of this increase,
and offshore wind will triple its
capacities.
Continued from Page 1
Gas and nuclear were likely to have
“amber” status, meaning they would
not be in the “green” category with
wind and solar power, but would fea-
ture in the EU taxonomy, the EU’s
ambitious labelling system for green
investment, according to a EU ofcial.
At the time of writing, the European
Commission was expected to publish
the draft taxonomy – the second del-
egated act – on 31 December, allowing
a few weeks of consultation with ex-
perts and governments. The nal pro-
posals may be published on 12 Janu-
ary and could only be blocked by a
super-majority of 15 EU member
states.
It will describe the sustainable cri-
teria for renewable energy, car manu-
facturing, shipping, forestry and bio-
energy and more, and include a
“technology-neutral” benchmark at
100 grams of CO
2
/kWh for any invest-
ments in energy production.
The EU taxonomy is a green clas-
sication system that is intended to
guide investors to projects that are in
line with Europe’s goal of net zero
emissions by 2050 and better protec-
tion of the environment.
Both gas and nuclear were expected
to feature in the next part of the EU’s
“taxonomy for sustainable activities”,
following a period of intense political
bargaining between the Commission
President, Ursula von der Leyen; the
French president, Emmanuel Macron;
and Germany’s new chancellor, Olaf
Scholz.
The rst two chapters of the sustain-
able taxonomy, the so-called ‘rst del-
egated act’, were passed on 9 Decem-
ber and came into force on 1 January
2022. But in a meeting of member
states on 29 November the project
nearly faltered.
The EU described nuclear as “a stable
energy source” needed “during the
transition to gas”. EU climate chief
Frans Timmermans also acknowl-
edged “nuclear and transition gas play
a role in the energy transition”, but
stressed that this “does not make them
green”.
An EU diplomat, speaking anony-
mously, explained to EUobserver that
a French-led group of 13 member states
tried to block the rst list “out of prin-
ciple” because the commission had not
agreed to include nuclear and gas in
the green taxonomy.
France and Finland pushed for nucle-
ar to be “fully part of the taxonomy”.
Ten other mainly eastern European
countries want gas included. Sweden
joined the group because the new rules
endanger its forestry sector.
Sebastien Godinot, a senior econo-
mist at WWF and member of the EU’s
Sustainable Finance Platform, said:
“The commission must deliver a sci-
ence-based taxonomy regulation that
excludes fossil gas, nuclear, and fac-
tory farming. Otherwise, the credibil-
ity of the taxonomy is ruined.”
Some argue the Commission may
have no choice but to compromise
with regards gas and nuclear – sup-
porting member states on one side,
and countries opposing these on the
other – while also being mindful that
investors and experts from its Sustain-
able Finance Platform will reject a
system containing contradictory po-
litical concessions.
Institutional investors have already
signalled they want a taxonomy based
on science, not political compromise.
Finland’s long-delayed Olkiluoto 3
(OL3) nuclear reactor has started pow-
ering up and will start producing elec-
tricity at the end of this month, some
12 years later than originally sched-
uled. Regular electricity production is
scheduled to begin in June.
The Nordic country’s nuclear safety
authority, STUK, gave permission last
month “for making the reactor critical
and conducting low power tests,” Finn-
ish electricity producer TVO said in a
statement. Construction of the 1600
MWe EPR began in 2005. Completion
of the reactor was originally scheduled
for 2009 but the project has had various
delays and setbacks.
Other EPR builds in France and the
UK have also been beset with delays,
with Hinkley Point in southwest
England pushing back its planned
electricity production by half a year
to mid-2026.
OL3 was built under a xed-price
turnkey contract by a consortium of
Areva and Siemens who have joint li-
ability for the contractual obligations
until the end of the guarantee period of
the unit.
Once low-power tests are completed,
the reactor’s power will be gradually
increased and further commissioning
tests conducted. STUK will oversee the
most signicant tests on site and check
the results of the commissioning tests.
During the power tests, permits issued
by STUK are required for power levels
of 5 per cent, 30 per cent and 60 per
cent. Electricity production starts at a
power level of 30 per cent.
Olkiluoto 3, which will run alongside
two existing reactors at Eurajoki on the
west coast, was the rst nuclear power
station to be procured in Europe after
the 1986 Chernobyl disaster.
“We are now moving step-by-step
with a safety-rst attitude towards the
moment we have waited for a long
time,” said TVO Senior Vice President
for Electricity Production Marjo Mus-
tonen. “The preconditions for the start-
up of the reactor have been fullled,
and soon we will be able to realise our
promises on Finland’s greatest act for
the climate.”
STUK said the preconditions for
criticality and low-power tests have
been met and the commissioning tests
performed before rst criticality show
that the plant operates as planned. It
noted the commissioning tests also
included re-tests carried out after mod-
ications were made to certain plant
systems.
The nal go-ahead came as the Min-
istry of Economic Affairs and Employ-
ment (TEM) announced it is launching
legislative preparations aimed at a
comprehensive reform of the country’s
Nuclear Energy Act. It said the future
use of nuclear energy – including new
technologies such as small modular
reactors – requires “appropriate and
up-to-date legislation”.
The revised draft legislation is ex-
pected to be submitted for consultation
during 2024. The government’s pro
-
posal to Parliament is due at the end of
the next parliamentary term, with the
law entering into force in 2028.
Headline News
Nuclear and gas still not seen as
Nuclear and gas still not seen as
“green” by EU climate chief
“green” by EU climate chief
Finland’s OL3 prepares to start-up, 12 years late
Finland’s OL3 prepares to start-up, 12 years late
Revised TEN-E rules
will boost hydrogen
Skrekas says the national
climate law is of “historical
importance”
n New EU rules for cross-border energy infrastructure
n IEA calls for more ambitious and concrete hydrogen policy efforts