A secure, clean, safe, healthy and economically efficient energy supply is no longer a technology development challenge, but largely a matter of investment in infrastructure and deployment of modern solutions on a massive scale.

31 Years After the First Energy Crisis, The Need for an Energy Strategy

Hans De Keulenaer | Sustainable Energy for All (SEAL)

31 Years after the first Energy
A secure, clean, safe, healthy and economically efficient energy supply is no longer a technology development challenge, but largely a matter of investment in infrastructure and deployment of modern solutions on a massive scale.
The need for an Energy Strategy
by Hans De Keulenaer, Sustainable Energy for All (SEAL)

The country imagines who its future competitors are most likely to be. And looming large on that horizon is China. China is short on energy . . . Russia only has energy . . .
Most countries don't have energy strategies. There is plenty of energy policies, plenty of energy regulations. There are even energy philosophies and enthusiasms. But energy strategies are in short supply.

P Ellis, Boston Consulting Group,
BBC If . . . the lights go out, March 2004

Since the first oil shock 31 years ago, has the world moved towards a more sustainable energy system? Or has a proliferation of energy policies, regulations, enthusiasms and philosophies resulted in a hive of activity, with little progress? Does Europe lack an energy strategy?

Such energy strategy needs to be formulated in terms of security of supply, economic efficiency and environmental performance of the energy system. These 3 dimensions in turn consist of total 11 subdimensions, and therefore often mean very different things to different people.

We have 4 technological solutions at our disposal to realise objectives formulated along above dimensions. These are: energy efficiency, renewable generation, nuclear power and clean fossil energy conversion. Each of these 4 technologies again does not represent a single option, but consist of a total of 13 families of options. Each option has very different characteristics and strongly differs in the way it supports the different dimensions of an energy strategy.

1. Strategic dimensions

1.1 Ensuring security of supply

A recent report Eurel04 contributed to the understanding that security of supply is not a single dimension. In the first instance, it means 'security of primary energy supply', or 'security of fuel supply', which is a necessary, but not sufficient, condition.

Security of supply means as well having the infrastructure available to convert energy, and deliver it to users. For electricity, this means power generation plants and distribution networks, either centralised or decentralised. This requires for example attracting capital offering a suitable risk-return proposition to investors.

Finally, security of supply means that the quality of supply is suitable for the energy need it serves. To power the digital economy, stringent quality requirements apply to electricity supply, that cannot be easily met with certain new energy technologies at a low cost. On the other hand, to power an emerging agricultural society or industrial economy, quality requirements may be less severe.

1.2 Ensuring a clean and safe energy system

This means primarily reducing emissions from fossil fuel combustion, such as CO2, SOx and NOx. Technical solutions exist to reduce emissions of SOx and NOx, but CO2 remains a major problem because of its sheer volume.

Other aspects of this strategic dimension are avoiding radiation, the handling/reduction of nuclear waste, nuclear safety and managing the risk for nuclear proliferation.

1.3 Ensuring an efficient energy system

Economic efficiency of energy supply means price levels for users, including taxes, that do not affect competitiveness of economic actors, and it also means stable prices.

There is an aspiration in Europe to use energy policy for job creation and economic development. For technologies which do not have indirect effects, and which target labour-intensive sectors (e.g. buildings), such effects may very well take place. But liberalisation policies in Europe have so far eliminated \mbox{100 000}'s of jobs, more than have been directly created by any other energy policy. And the indirect (price) effects on energy may offset part, if not all, of these direct job creation effects (Brem03,BMWA04).

2. Technical options

2.1 Energy efficiency

This option includes a very wide range of means to improve technical efficiency, such as fuel-efficient cars, well-insulated buildings, high efficiency appliances, ...

A longer-term option is to redesign the urban form. For example, the amount of exposed surface area of buildings impacts energy use. And there is a close link between the organisation of the urban form and its transport energy requirements.

Finally, lifestyle also strongly impacts energy use, but is obviously most difficult to change.

Energy efficiency is compatible with almost any of the above strategic dimensions, and hence should be pursued to the maximum extent in any energy strategy.

2.2 Renewable energy (RE)

Depending on its intermittent or non-intermittent nature, RE supports energy strategic objectives in a different way. Intermittency has 2 aspects: availability and dispatchability. Limited availability leads to more capacity required to serve the same energy need. Lack of dispatchability leads to a need for energy storage (requiring even more capacity to compensate for conversion losses) or active demand management to balance the system. A renewable policy strongly supports a clean energy supply and security of fuel supply, but requires compromises in other areas. It is therefore strongly supported by advocates who give a high weight to the strategic dimensions specifically supported by RE.

2.3 Nuclear energy

Again, nuclear energy is not a single option, but a range with different characteristics. One may well argue that today's civil use of nuclear energy is not sustainable, but advanced fission reactors are becoming possible, offering advantages such as passive safety and reduced risk of proliferation. Advanced waste processing techniques may be developed that reduce fuel use, while reducing lifetime and radiotoxic emissions of waste. Fast neutron reactors are a possibility within reach, given the will to exploit this technology. Nuclear fusion is one of the most challenging tasks even undertaken by man. It is a high risk option, but so far, there is no indication that nuclear fusion will not succeed.

2.4 Clean fossil technologies

Considering the current importance of fossil energy in primary energy supply, pursuing the most efficient conversion of this polluting energy source is an essential element. With the current trend, emission-free energy sources such as energy efficiency and RE only succeed in compensating for a small part in the growth of primary energy demand, and the share of fossil fuels in the primary energy mix is still increasing on a global scale. A technology that is available today, and deployed on a massive scale, is cogeneration and combined-cycle power plants. Advanced coal conversion plants are available, but used on a limited scale because of market conditions. Finally, sequestration is a speculative technology that may facilitate the use of coal in the context of concerns over climate change.

3. Linking technical options to strategy

As shown in the following table, each technical option behaves differently along the 11 strategic dimensions defined. The table is constructed starting from the current energy system, and evaluates how it would support each of the 11 dimensions if more of the technical option were used. Each technical option is considered in isolation for this exercise, while in practice, an energy strategy will work on a portfolio of technical options to pursue a particular set of energy objectives, weighted in importance.

Click here for larger image of table

First of all, the table demonstrates that there is no such thing as a perfect energy technology, though energy efficiency and non-intermittent renewables come pretty close.

Equally, the table demonstrates that sufficient options are available to achieve almost any strategic objective. Pursuing a wide portfolio of options appears a wise choice to ensure economically efficient and stable energy prices.

Three columns merit being mentioned specifically:

  1. Infrastructure in a liberalised market: a lot of the solutions listed are capital intensive, and will require private capital. A regulatory environment is needed that offers reasonable stability to investors, and allows them to derive reasonable revenue streams from the benefits produced by these alternative, cleaner but more expensive technologies, while at the same time safeguarding for excessive windfall profits.
  2. Price of energy: energy price levels need to support industry's competitive position. But current energy prices are too low to ensure a sustainable energy system. Low prices not only lead to a higher than necessary demand, but they make investment in sustainable energy technologies unattractive. Levvies on energy are used to finance programmes, certificate schemes, agencies or institutions, ... Efforts must be made to ensure that these levies directly finance investment into sustainable energy, rather than indirectly through price effects.
  3. Job creation: equally ambiguous is the signal of the employment effect from using specific energy technologies. Most technologies will create jobs directly, but one must take into account the technology they substitute, as well as price effects. A technology financed through a support scheme impacts energy price, which can affect competitiveness and hence jobs through ripple effects in the entire economy.

4. Conclusion

A secure, clean, safe, healthy and economically efficient energy supply is no longer a technology development challenge, but largely a matter of investment in infrastructure and deployment of modern solutions on a massive scale. Developed countries can afford almost any energy system, but cost of energy and industry competitiveness become major attention areas. For developing countries, the question is affordability, and the allocation of scarce resources in the light of many stringent requirements. Considering the expected price pressure and resource challenges, a strategy to pursue a wide range of options, with resources allocated according to their potential seems appropriate.

Liberalisation policy needs to focus on ensuring investment in energy infrastructure, offering an adequate investment climate.


[Eurelectric, 2004] Eurelectric, Security of Supply -- Discussion Paper, November 2004, Ref 2004-180-0019

[Bremer, 2003] Bremer Energie Institut, Ermittlung der Arbeitsplatze und Beschaftigungswirkungen im Bereich Eneuerbarer Energien, 2003

[BMWA, 2004] Gutachten im Auftrag des Bundesministeriums für Wirtschaft und Arbeit, Gesamtwirtschaftliche, sektorale und ökologische Auswirkungen des Erneuerbare Energien Gesetzes (EEG), 2004

The 13 technology options each influence the 11 dimensions in either a positive, neutral or negative way. In this accompanying survey to the article, the question is asked for each of the 13 technology options, how using it more would influence policy objectives.

We need your input on this matrix, in order to see where there are area's of agreement, and where opinions differ. We do not need you to complete all 13 questions. Participants can focus on the 2-3 which are closest to their area of expertise. http://www.zoomerang.com/survey.zgi?p=WEB224P894RDUR


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