LTH - Faculty of Engineering

MKVN95 - Environmentally Friendly Power Production

Energy use
Changes in the energy demand with the electrification process

Francisco Salamanca Molina, Chinweike Christian Ukachukwu,Luuk Van Der Goot

Abstract:

This article examines the energy consumption of Germany and the various factors that
influence it. It discusses Germany's energy mix, the energy sources it relies on, the policies
that affect its energy use, and how it has been shifting towards a more sustainable energy
future. It also looks at the economic and environmental implications of Germany's energy
consumption with focus on heating and transportation. Lastly, it looks at the potential for
further progress in reducing energy consumption and the roles that policy, technology, and
public opinion can play in achieving this goal.

Date: December XX, 2022

Contents

1. Introduction 3

2. Methods 4

3. Results 4
3.1 Heating 4
3.1.1 The current state of the German heating sector 4
3.1.2 The impact of electrification on the heating sector 5
3.1.3 The future of electrification in German heating sector 7
3.2 Transport 9
3.2.1 The current state of the German transport sector 9
3.2.2 The impact of electrification on the transport sector 10
3.2.3 The future of electrification in German transport sector 12

3. Discussion and Conclusions 14

4. Bibliography 16

1. Introduction
Nowadays, with the efforts that a lot of countries are making to get into carbon neutrality,
some new technologies have been developed. Since most of the renewable power generation
is electric, it is in these new technologies that Electrification plays an important role, because
calefaction, electric cars, and other technologies aim to replace traditional fossil fuel sources
with electricity. With that in mind, finding the correct way to electrify a whole city is
different now from how you would do that in the 90’s. That changes for example, in the case
of electric cars, the daily demand curve of electricity or the electricity daily peak near the
night hours, in cases like São Paulo city where is expected that electricity demand increase
2% replacing 10% of current cars (The Impact on Electricity Demand and Emissions Due to
the Introduction of Electric Cars in the São Paulo Power System, 2022), and that affects what
kinds of power plants are going to be used and the energy sources that a country is using.
Furthermore, the nature of this energy demand that we will see as a result of electricity
influences the requirements that the electricity production and infrastructure will need to
meet.

This paper will give a review of Germany and how the use of energy and electricity changed
in the last years and what new projects they have announced in the process to get carbon
neutral. We will be looking specifically at policies regarding the German heating and
transport sectors as these have missed their emission reduction targets. With that information
an analysis will be made to explain what this means for energy demand in the near future. We
will aim to make a comprehensive list of the most important boundary conditions for an
energy infrastructure that will meet this changed energy demand and we will try to analyze to
what degree these boundary conditions are met by the current energy infrastructure in
germany.
2. Methods
This paper analyzes the energy transition in Germany locally called the energiewende. It will
focus on two sectors where targets were missed, those being heating and transport. Both of
these will be analyzed through a couple sub questions, these questions being:
- What is the current state of the sector?
- Why did this sector miss their targets?
- What are the results of missing the targets for this sector?
- What does the future hold for this sector?
- What do we recommend for the sector

These questions will be attempted to answer using literature analyses in three sections for
each sector.

3. Results

3.1 Heating

3.1.1 The current state of the German heating sector

Heating is one of the two major sectors where Germany lags in the transition to a more
sustainable economy. One of the biggest reasons why German heating has struggled to
become carbon neutral is because of its reliance on gas. Recently this has become especially
problematic for the energy infrastructure as Russia has stopped its gas exports to the
European Union. This section will discuss some statistics about heating in Germany, why the
heating sector has struggled to meet recent targets regarding the reduction of emissions and
current German strategy to reduce emissions in the heating sector.

Heating is a massive consumer of energy in germany. in 2017 27% of energy use in Germany
went to the heating of buildings and another 5% was used for hot water. Besides this, 22%
was used as process heat in industry (Bundesministerium für Wirtschaft und Klimaschutz,
2019), however this report will mainly focus on residential heating. In 2020 50% of
households relied on gas heating, 25% used heating oil, 14 percent was connected to district
heating, 2,6% used electricity directly, another 2,6 percent used electric heating pumps, the
remaining group used other methods of heating. For newer residential buildings the situation
is slightly different here: 38% used gas heating, 31% had electric heating pumps and 23%
was connected to district heating (Bundesministerium für Wirtschaft und Klimaschutz, 2019).
It is important to note that methods based on electricity generally have less carbon emission
as electricity in Germany is for 60% generated from renewable sources (International Energy
Agency, 2020).

The main reason that Germany missed its targets in the residential buildings sector is the fact
that the targets assumed a significant reduction in energy use. This would be achieved by
building newer buildings with efficiency in mind (Bauer, 2021) and by offering fiscal benefits
or subsidies. However, this policy never became reality as plans got stuck in government and
legislative procedure in the Bundestag and between the different bundesländer. As a result
Germans have been waiting for these fiscal benefits since 2011 (Deutsch Umwelthilfe, 2019).
This has caused a backlog in the renovations and refittings of older buildings to make them
more energy efficient (Eriksen, 2020). New policy packages were enacted in the meantime
but data to show whether this policy is effective or not is not yet available . It is also expected
that because of the higher energy prices, caused by the halted Russian gas exports, a lot of
parties like homeowners and landlords will try to improve the energy efficiency of their
houses. This in combination with wide spread information campaigns showing how to use
less energy at home will reduce the amount of energy used for residential heating.

Germany is doing a couple things to reduce the carbon emissions in the residential heating
sector. A couple of them were mentioned in the previous paragraph. For example their focus
on improving the efficiency in the heating of german buildings and the information
campaigns. Besides those things there is also a large focus on using combined heat power.
This means that residual heat from power plants gets recovered and used for heating, greatly
improving the energy efficiency of the plants. Combined heat power plants are able to use
about 90% of their primary consumed energy. Combined heat power has become a lot more
prominent, but this is partially because of the growth of gas power (Appunn, 2015). The final
big thing in German heating is biogas. Germany is replacing natural gas with biogas, using
biogas plants to synthesize biogas. This biogas is in that way used to facilitate CO2 neutral
power and heating but it is not yet and not expected to be a major contributor in the near
future (Appunn, 2016).

3.1.2 The impact of electrification on the heating sector

Making energy consumption more environmentally friendly has been at the forefront of the
sustainability goals of major key players in the energy industry, including the government of
Germany. Where energy resources are tending towards the renewable and sustainable mean,
that implies that the majority of the industrial and residential energy needs will be met
through renewable sourced electrical energy. Heating sector is that part of the energy industry
that consumes a huge chunk of the energy production and usage. This sector has been
fossilized over a long period of time. Natural gas, gas oil and coal have, for several years,
dominated the heating sector of the energy industry and that is totally against the moves to
defossilize the energy sector.

The German Government, in the bid to achieve carbon neutral energy generation and usage,
moves to implement a heating transition policy, Wärmewende. Heating transition has
significant potential to curb emissions and is essential for Germany to reach its target of
carbon neutral development in less than three decades. Power-to- Heat is a relatively new
term for the transformation of electrical energy into heat. This can be accomplished using
traditional heating resistors, electrode boilers, and heat pumps. Power-to-Heat systems are
designed to use excess electricity generated by renewable energy sources that would
otherwise be wasted.

To evaluate the importance of heat pumps over the existing fossil fuel-powered heat plants,
we should understand that there is no one-size-fits-all answer to this question, as the best way
to replace gas plants in district heating will vary depending on the specific circumstances of
each case. In general, however, heat pumps can be used to supplement or replace gas plants in
district heating by providing a more efficient and environmentally friendly source of heat.
Additionally, heat pumps can often be used in conjunction with other renewable energy
sources, such as solar thermal panels, to further reduce emissions and improve the overall
efficiency of the district heating system. There are the observable effects and possible
benefits of the Heating transition in Germany.

There is an initial cost of electrification which will require some modifications and research.
The cost of electricity is heightened because the gas that is used for heating is now in limited
supply which warrants the sharing of available electric power between heating and other
activities. However, in the long term, it is considered that the Power-to-Heat system in
Germany will be more cost efficient compared to the current fossil fuel-driven heating sector
of the energy sphere. Cost reductions are driven by the replacement of fossil fuels by other
energy sources that are more sustainable and renewable which are the main driving force for
this heat transition. Over time, the price per KW of energy generated through renewable
energy sources has dropped while the price and implications of fossil fuels (Crude oil, Coal
and natural Gas) are on the continuous rise. It also comes in the form of better use of capital
invested in renewable materials. There will be more efficient operation of thermal power
plants because of less need for cycling. There will not be any need to build a new overall
distribution infrastructure as existing district heating networks can be used.

Power-to-Heat technology enables Germany to integrate renewable energy sources into

powering the heating sector of the energy industry. This integration can be understood as a
higher utilization of renewable energy sources to meet final energy demand. Power-to-heat
can contribute to such integration with respect to both a better utilization of existing assets
and additional renewable capacity expansion. Power-to-heat allows making better use of
temporary renewable surplus generation, either from home units or from established
generation systems. This can be feasible without the use of additional heat storage,
particularly in case district heating systems can be used. Utilization of renewable surpluses
improves if additional active or passive heat storage is available.

Power-to-heat contributes to decarbonization if the substitution of fossil fuels for heating

yields greater emission reductions than potential emissions increase due to additional
electricity demand. As of 2018, only 15% of the district heating are from renewables, majorly
as a test for the heat pumps, where over 71% are shared between coal and gas. As reduced
CO2 emissions are the main aim of a higher utilization of renewable energy sources, it will,
in the long run, lead to a decarbonised energy sphere.
3.1.3 The future of electrification in German heating sector

About the Current Power-to-heat technologies available right now, there are some differences
between the effects and where the energy supply can be obtained from. Considering the
climate footprint and the final energy consumption are two of the most important effects in
relation to the German carbon neutral policy. About energy consumption in Figure 3.1.1, it
can be seen that using alternatives to Gas Boilers for a new building in Korbach, Germany. In
this figure it can be seen that there are better alternatives to the common Gas Boilers, this is
because different technologies use ambient energy, such as electric or ground heat pumps,
reducing the total energy demand for gas.

Figure 3.1.1: Energy demand for different technologies (Sameer et al., 2022)

But to have a whole view is also necessary to understand the climate impact these
technologies made. In, it can be seen that the tons of CO2eq. per year for the same case as
shown in Figure 3.1.2. Here it can be seen that using a ground source heat pump with
photovoltaic solar panels has better results in both variables, energy demand and climate
footprint.
 Figure 3.1.2: Climate footprint for different technologies (Sameer et al., 2022)

But it also has to be considered that using this kind of technology is as clean as the electricity
matrix, and also, there are more efficients ways to use energy, for example, district heating.
District heating technology works based on the economy of size. It is better to produce the
same amount of energy in one big asset than doing it in multiple smaller assets (Frederiksen
& Werner, 2013). The only contrast that district heating poses is that some conditions have to
be met to work properly, such as, have a big heating demand in a relatively small area, and
also have a cheap and local primary energy source. Also the piping system is expensive and it
could take time to have the system working properly. Instead Heat pumps are easier to install
but less efficient.

As a recommendation for Germany, It has to be promoted both technologies, Heat pumps and
District heating, depending on the case, for high heating demands district heating could be
better, but for town or areas with not that much density of people is better idea to use heat
pumps to reduce the energy demand and the cost of infrastructure.
3.2 Transport

3.2.1 The current state of the German transport sector

Transport is the second major sector where Germany failed to meet targets. The transport
industry is still heavily reliant on fossil fuels, particularly oil. The German transport sector
emitted 148.1 tonnes of CO2 equivalents in 2021 while their target was 145 Tonnes of CO2
equivalents (Alkousaa & Wacket, 2022). This section will discuss what the German transport
sector is like right now using statistics and active policies and shortly look at major reasons
why they have missed emission reduction targets.

Germany is home to one of the biggest automotive industries in the world. It is therefore not
surprising that most of their transport is done by road. This also where 95% of emission from
transport originate (fig 3b1).

Fig 3.2.1 : Freighthaul (tonne - kilometer) own image data from: (Statistisches Bundesamt,
2022) and emissions (CO2 eq) by transport mode (Forschungs-Informations-System, 2022) in
2019.

There are a couple reasons why the transport sector is struggling to meet targets. The first
being that transport is a very difficult sector to progress in with multiple countries facing
challenges in decarbonising the transport sector (International Energy Agency, 2019)
(International Energy Agency, 2021). The second being the inability of the government to
enact effective policy. The government looked at biofuels in the early and mid 2010’s while it
was obvious that they are not capable of providing the desired results in the sector. The final
reason is strongly linked and has already been mentioned. It is the big automotive industry
which boasts a very strong lobby that has been effective in preventing the government from
encouraging electric car use in a meaningful way (Hockenos, 2016).
 Fig 3.2.2: Showing the pollution per tonne kilometer for different transport modes in 2019.
(Forschungs-Informations-System, 2022)

Currently Germany also has some climate damaging subsidies currently still in effect. For
example a subsidy on diesel and company cars and a bad implementation of a distance
allowance all encourage traveling by car instead of by train. On top of that there are still
substantial subsidies for air traffic. A final note that should be added is that Germany changed
government recently and one of the biggest things they did was experiment with a 9 euro a
month unlimited public transport ticket for and they are now implementing a 49 euro per
month public transport ticket (Popovidi & Schmitz, 2022).

3.2.2 The impact of electrification on the transport sector

Energy Generation, Distribution, and utilization all cause a slew of issues on a global scale,
of which the transport sector has a fair share. Oil is the most common source of energy in the
transportation sector, and it is frequently extracted or transported through environmentally
sensitive areas(Appunn.k, 2021). Additional energy is required to refine crude oil into
gasoline, diesel, or aviation fuel, and finally, the combustion of fuels emits pollutants such as
nitrogen oxides and particulate matter. The key emphasis, however, is placed on the
greenhouse gases emitted by transportation systems and responsible for global climate
change. To handle these, the German Government decided to reduce power usage, including
transportation energy consumption by establishing sector-based greenhouse gas emission
targets. through the German Climate Protection Act.

Unlike the transportation transition, the decarbonisation in transportation is primarily a

technological issue. However, it, too, requires political backing. Carbon-neutral
transportation necessitates the use of carbon-neutral energy. And such energy, which in
Germany is primarily derived from sunlight and wind, is scarce and will remain so for the
near future. The Paris Accord, on the other hand, requires Germany as well as the other
signatories to decarbonize their economies. For the time being, this means that all sectors -
industry, private households, transportation, and so forth - compete for the same limited
supply of carbon-free electricity. The net impact on emissions will be zero if they cannibalize
themselves in the process. A Renewable energy transition in the transportation sector thus
necessitates a supplemental influx of carbon-neutral energy. Electricity is the simplest way to
introduce more renewable energy into the economic system, and it will play an important role
in powering tomorrow´s mobility. There are two explanations for this. First, there is still
plenty of room for Germany to increase electricity generated by solar and wind power, the
country's two most important carbon-neutral energy sources. Second, electricity can be used
as a direct source of power for automobiles. Furthermore, electricity can be transformed into
carbon-clean fuels such as hydrogen. The issue with transforming electricity is that the
conversion is energy demanding. The more transition, the less photovoltaic and wind power
is available as consumable power. Furthermore, because the transformation is technically
demanding, it raises the cost of energy supply. This means that the most efficient technique to
use electricity is directly.

According to experience, transforming the transportation sector will necessitate structural

shift to the regulatory framework at both the German and European levels. Prospective
infrastructure investments must be aimed at lowering emissions, and the government must
create deliberate awareness to transportation users to steer their behaviour in the right
direction. Decision-makers have several tools at their disposal for this purpose, including
levies, surcharges, restrictions, and standards based on the carbon emitters levying principle.
That which does not work is excluding subsidies, declaring standards unacceptable boundary
emissions, or prioritizing balanced budgets. This is going to stymie state intervention.

In addition, the transformation constitutes a very complex social challenge. For it necessitates
that millions of people change their routine behaviours and abandon habits that have taken on
ritualistic characteristics. This is a key distinction between the transportation transformation
and the energy transition. Since the Fukushima nuclear disaster, Germany's energy transition
has primarily focused on changing electricity production, rather than changing the product
itself. Even as photovoltaics and wind power become more prevalent, outlets continue to
deliver electricity at 220 V and 50 hertz. The transportation transformation, on the other
hand, is heavily reliant on voluntary behavioural changes. As a result, the need for
transformation must be conveyed persuasively, and time must be allowed for the adoption of
new habits. According to experience, such processes typically take decades rather than years.
Therefore, prompt action is required.
3.2.3 The future of electrification in German transport sector

About the different opportunities in the transport sector, there are some that are in
development and others currently working. But to compare in an objective way the energy
use and the Greenhouse gas emissions(GHG) of each technology is necessary not only
consider the vehicle itself and its efficiency but also the energy supply, how many emissions
this energy costs, and also how this transport will affect and the end of its life. This is called a
Life cycle assessment, considering emissions during the well-to-wheel process and adding the
end of life emissions. An example of this is the primary idea of changing fuels by Liquid
natural gas for the road freight transport, this measure reduces less than 10% GHG emissions
in Germany(The ICCT, 2020 )

When compared to static charging, electric road systems provide vehicles with energy while
moving, allowing them to reduce the size and weight of their on-board batteries. This is
especially beneficial for trucks and buses, as a large truck would require a battery with a
capacity ranging from 600 to 800 kWh, requiring a battery package weighing several tonnes
considering current battery constituents. However, significant reductions in battery capacity
would necessitate large-scale integration of the Electric Road System, just as the use of
hydrogen necessitates network projects, and this will be accompanied by high initial
investment costs.

Before scaling up, ERS faced several challenges, including developing sustainable economic
business strategies, establishing standards and guidelines, and accommodating increment in
technological, commercial, and structural complexities. Furthermore, ERS will boost the
power requirements during times when the load is already high. Relying on how, when, and
to what degree the automobiles are charged, the Electric Road System could enforce local or
regional limitations on the power grid.

Further to that, the expenditure and climate advantages of Electric Road Systems will be
ascertained by the effects on the power generation system. The effects will vary by country,
based on the specifics of the electricity system, such as the availability of renewable energy
(Taljegard, 2019).

The electrification of the transportation sector via Electric Vehicles with static charging or
with Electric Road Systems with dynamic charging places a new demand on the power grid.
This new load will have an impact on the electricity system depending on when and how
much electricity is used. This structure will represent various charging techniques, such as
whether Vehicles are charged directly while stationed or charging is improved based on what
is most advantageous from an electricity system standpoint. This will have a variety of
consequences for investments in the capacity of the energy infrastructure. This new load may
also create the opportunity for battery-powered vehicles to provide demand-side management
to the power grid, depending on the electrification approach used.

If Germany consider three different scenarios where the “Reference scenario” is a prediction
keeping the policies and not changing a lot the electricity matrix, a “Free play” scenario
where policies would go in a permissive way respect to GHG emissions, and a “Regulated
Schift” where policies would be more strict and subsidizing cleaner technologies, as it shown
in Figures 3.2.3 and 3.2.4 , the only one that could be below the Climate target for transport
is a regulated shift. At the same time this case shows lower energy consumption by 2040.

Figure 3.2.3: Energy consumption in transport sector and its sources (Ehrenberger, 2021)

Figure 3.2.4: CO2 emissions predicted in different scenarios (Ehrenberger, 2021)

But to consider this case it is necessary to go into the variables that were taken into account.
At first this scenario assumes that C02 target values for new passenger cars at 45[g CO2/km
in 2040], increasing taxes for diesel and gasoline fuels and no tax on H2 and electricity. Also
investment to decrease travel-time in urban areas, increasing passenger utilization. And
finally it is assuming a share of renewable energy of 78%, decentralized with buffer and
storage technologies.
3. Discussion and Conclusions
The energy-related environmental challenge being focused on the user-end directs us towards
sustainable consumption and being responsible in resource management.

The global clamor for more sustainable transport has become so intense that the majority of
developed countries set climate goals for their transport sector, especially with regards to
energy use and climate change. Germany for one, has developed extensive measures to reach
these climate goals through electrification. The Electric road and real systems has proven to
be a large leap from the conventional fossil-powered transport system. As expensive as that
may be, they have made the most observable impact globally. Lar-Magnus, in his article,
stated that Germany, alongside Sweden, are the global leaders in the electrified transport
system(Lars-Magnus, 2021). Therefore, it can be inferred that Germany is contributing
effectively to sustainable transportation.
However, there is still much more work to be done, as it is observable that Germany is still
lagging behind its own climate target.Nikos Papatolios, in his article, Increase of transport
emissions in Germany alarming for climate targets, stated that the German transport sector
failed to meet its emission targets for 2021, emitting greenhouse gasses 1,2 per cent more
than 2020(Nikos, 2022). The issue of lagging behind in meeting set sector-based climate
goals are not just limited to germany. Lars Margnus´ report helped to reveal that, while
Germany and Sweden are at the global forefront of sustainable transport, they are still having
policy issues and social acceptability challenges.
Where the key players in the automobile industry who have spent their years making fossil
fuel-powered legacy fleets, will be forced to make vehicles that will meet these regulations,
which will change their entire business model. This is definitely going to affect the transport
sector and will require some investment in research and development. Volkswagen, being
sanctioned for diesel gate scandals (the emission limit for automobile manufacturers), was
simply unfortunate, because many other automobiles in one way or the other, exceed this
emission limit, but lobby their way through the checks.
It is therefore recommended that stricter sanctions are placed on the erring automobile and
transport vehicle manufacturers (Production End)and more stringent tax on vehicles powered
with less environmentally friendly fuels(Demand End). Where the government is investing in
electrifying the transport sector through infrastructure, the production of the electricity for
these infrastructures should also be from renewable sources.
It is also recommended that Germany collaborate with other countries to pursue these
common goals. Where Germany produces most vehicles used in Germany and over 25% of
the global car fleet (Bitonto, 2022), controlling the emission from imported vehicles is
dependent on the collaboration between Germany and the manufacturing countries, being on
the same page with sustainability goals.
Where most of the transport electrification infrastructures (Electric Train, Trams, Buses,
Electric Vehicle Charging Stations, and Electric Road Systems) are expensive to install and
manage, the Government of Germany should support and incentivise the startups and
sustainability minded corporations that are bringing various innovative ideas that would help
in achieving the climate goals from the demand side.

Recommendations in heating sector:

The heating sector of the German energy industry has in the most recent past years been
powered with oil, gas and biomass. However, the recent reintroduction of heat pumps
emanated from the need to electrify this sector. Heat pumps, being the future of heating, is the
best way to not just make heating more efficient, it is also an opportunity to introduce
renewable energy into the German heating sector, especially with strong regard to the
consumer end of the energy supply chain. The introduction of technology, driven by
electricity generated from renewable sources, will help the decarbonisation of the sector,
which will definitely have a regional effect.
Sustainable housing design should include insulations which will reduce the need for heating
in some seasons, and maybe
Replace technologies, solve insulation issues , invest in smart heating grids.
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