CEmailvision Issue 8, Winter 2009

The final word on the sustainability of biofuels and bioenergy has not yet been spoken and it is sure to be one of the topics at the Copenhagen climate summit in December 2009. Two sections of the International Energy Agency - IEA Renewable Energy Technology Deployment (RETD) and IEA Bioenergy - want to provide input for biomass discussions in Copenhagen, with the aim of ensuring sustainable and optimal use of biomass in energy applications. These sections of the IEA have therefore asked CE Delft to head a consortium to draw up policy recommendations on how biomass can best be used as a sustainable energy source. The study is being carried out in collaboration with the Öko Institut, Aidenvironment and the Clingendael International Energy Programme and is scheduled for completion in the autumn of 2009.

For more information, contact Bettina Kampman: +31 15 2150 150.

Greenpeace International is following European policy developments on biofuels very closely and when a EU proposal for a standard methodology for calculating the carbon emissions of biofuel production and use was presented a few months ago, the organisation asked CE Delft to carry out an in-depth study to assess its validity. The conclusion: the calculation method proposed by the EU still has a number of serious shortcomings, being essentially a ‘work in progress’ with plenty of scope for improvement. Meanwhile, the EU has itself also been making a number of changes to the methodology. Despite the recent modifications, though, the methodology still fails to adequately address a number of sustainability issues. Greenpeace will therefore be using the results of the CE Delft study in a campaign to get the EU proposal revised.

Greenpeace also commissioned CE Delft to draw up a manual for calculating the carbon balance of biofuels, so the organisation can get a more quantitative handle on the issue. As part of the study three illustrative case studies were elaborated. One of the things these show is that it makes a world of difference to the carbon balance on what kind of land the biofuel crops are grown. Palm oil production is currently associated with a range of negative impacts, for example, partly because it is all too often accompanied by deforestation and the carbon emissions to which that gives rise. The CE Delft study shows, however, that palm oil grown on grassland can have a laudable carbon balance. 

For more information on this project, contact Harry Croezen: +31 15 2150 150.

Across Europe the construction of new generating capacity is being hotly debated. Is it to be nuclear, coal or gas? CE Delft has been asked by a Dutch ministerial advisory committee to elaborate the recently proposed Transition Strategy for heat and power generation in greater detail and provide more quantitative underpinning. The Transition Strategy calls on the Dutch government to wait no longer before definitively opting for a transition to a sustainable energy supply. If power generators invest in coal-fired and nuclear plant in the months and years ahead, this will hamper Dutch sustainability efforts for decades to come. One of the key reasons is that if the country’s robust ambitions vis-à-vis renewables (wind and biomass in particular) are to be achieved, no new base load capacity (coal or nuclear) should be installed. Instead, what is needed is flexible capacity based on gas (natural gas/coal gasification) or base load capacity hooked up to storage systems. The major question is therefore: who is to pay for this flexibility?

For more information on this project, contact Frans Rooijers: +31 15 2150 150.

CE Delft was asked by the Swedish environmental protection agency Naturvårdsverket to conduct a study on emissions trading in the transport sector, one of the few sectors that have failed to cut its CO₂ emissions in recent years.

CE Delft first assessed the benefits and drawbacks of introducing emissions trading for road transportation. We then assessed the pros and cons of a combination of this policy instrument with CO₂ emissions standards for passenger cars. The results, summarised in the report ‘Emissions trading and fuel efficiency in road transport, An analysis of the benefits of combining instruments’, show that combined use of the two strategies has many advantages. "If the two policies are rolled out together, they cancel out one another’s drawbacks," says project leader Bettina Kampman. "On their own, CO₂ emissions standards for cars do not lead to sufficient cuts in overall emissions. This measure does create a powerful incentive to buy fuel-efficient vehicles, though. What emissions trading does is set a cap on overall emissions. If this were the only approach adopted, however, the incentive to buy an efficient vehicle would be limited, while it’s precisely here there’s plenty of scope for progress." The secret thus lies in combining the two strategies. Perhaps this result can reverse the trend of ever-rising CO₂ emissions in the transport sector.

The report ‘Emissions trading and fuel efficiency in road transport, An analysis of the benefits of combining instruments’ can be downloaded from our website.

For more information on the project, contact Bettina Kampman: +31 15 2150 150.

CE Delft recently organised a study trip to a German project for CO₂ storage being rolled out by the international energy company Vattenfall. Participants were keen to learn more about the technology, which allows the CO₂ emissions from coal-fired power plants to be stored in liquid form. The study party included representatives of  government agencies, consultative bodies, technology institutes, universities and companies active in LNG terminal operation, oxygen production and power generation. Vattenfall, for its part, is keen to share the know-how that is emerging from the pilot project.

In return, the delegation informed Vattenfall about the LNG Oxy-Fuel concept and ongoing developments in the ports of Rotterdam and Eemshaven and the pilots being run by E-On and Essent/Gasunie in Groningen and the Maasvlakte industrial zone, respectively. CE Delft has prepared a report on the trip.

The study trip was organised by CE Delft at the request of Deltalinqs, the association of industries operating at Rotterdam port. The idea for the trip to Vattenfall came up during a workshop organised by Deltalinqs in December 2007 on the integration of LNG and oxy-fuel combustion.

For more information on the project, contact Ab de Buck: +31 15 2150 150.

In a recent study by CE Delft for the Royal Dutch Transport Federation KNV (an employers’ organisation representing the interests of firms providing freight and passenger transport services) and the construction company Volker Wessels, CO₂ emissions reduction was again the focus. The commissioning parties wanted to hear from CE Delft whether there are any changes to road infrastructure that could conceivably help achieve sufficient cuts in the CO₂ emissions of the Dutch transport sector. Given that the Netherlands has pledged to reduce its CO₂ emissions by 30% in 2020, the project received financial support from the Dutch Ministry of Transport.

The results indicate there are minor gains to be achieved with modifications to existing infrastructure or with new infrastructure. One change that would have a substantial impact, for example, would be to install generating plant in or along road infrastructure, in the form of roadside wind turbines, say, or heat collectors embedded in the tarmac. Another option that could help cut emissions are heat exchangers to harness geothermal heat. While these may count as infrastructure measures, though, they do not lead to any reduction of vehicle emissions.

One surprising result concerns the impact of measures designed to improve traffic flow. The study shows that it is a misconception that this automatically leads to a decrease in environmental burden. Although faster-moving traffic means a reduction in the fuel burned by individual vehicles, in the longer term it also leads to greater mobility and more traffic. On balance, this generally means a rise in CO₂ emissions. For specific vehicle categories like lorries or buses, though, smoother traffic flow can help reduce CO₂ emissions. One option here would be to reserve certain lanes specifically for heavy vehicles. Other measures that would prove effective include improving cycling infrastructure and building edge-of-town distribution centres and parking facilities at train stations.

For more information on this project, contact Huib van Essen: +31 15 2150 150.

How can maritime greenhouse gas emissions be addressed in future climate policy?
CE Delft is currently engaged in three studies relating to maritime shipping and climate policy, The studies are being carried out for the International Maritime Organisation (IMO), the German environment ministry (BMU) and the European Commission and DG Environment.

Until now ocean shipping, like aviation, has not been included in greenhouse gas reduction targets in the Kyoto protocol. One of the main reasons is that these emissions cannot be easily allocated to specific countries as they take place outside national borders. The future climate agreement which could be concluded in Copenhagen later this year could include these sectors. The EU wants to see both ocean shipping and aviation included in the new agreement. Should those efforts prove unsuccessful, the EU intends to roll out its own policies. The studies in progress at CE Delft will help elaborate whichever of the policy options is ultimately decided.

German study
What the European Union would most like to see is a global climate policy regime for maritime shipping. At the request of the German environment ministry, CE Delft is heading a consortium of parties engaged in research on the ways in which such a global regime might be elaborated. The challenge lies in bringing the developing nations on board. At present these countries have no climate targets to meet, and changing this would be costly to them. This study is therefore focusing on ways to minimize the costs and maximize the benefits of a global policy for this group of nations. It does so by designing a policy that has the least impact on developing countries. The benefits can be maximized for example by using revenues from an auction of emission allowances to fund adaptation in developing countries. If it emerges that the policy and the revenues will allow dikes to be built in Bangladesh, for example, or irrigation schemes in Africa, developing countries will benefit, too, and perhaps be more willing to cooperate on worldwide policy.

IMO study
It is not only Germany that is investigating the pros and cons of a global climate regime for ocean shipping. The International Maritime Organisation, a United Nations body, is also thinking the issue through and has commissioned the Norwegian agency MARINTEK to carry out a study. CE Delft is acting as a subcontractor responsible for the policy analysis work. The study is considering various aspects of ocean shipping, including the emissions caused by different types of vessel. CE Delft reviews the benefits and drawbacks of alternative policy options.

Unilateral European policy
If efforts to reach global agreement prove unsuccessful, the European Union intends to introduce its own climate legislation for maritime shipping. CE Delft has been asked to assess the scope for this kind of unilateral European strategy and is heading a ten-strong consortium from across Europe that is elaborating policy options and assessing their estimated impact. The study will ultimately lead to draft legislation and a European impact assessment, unless the world reaches a global agreement first.

Each of the three studies run for a year and are scheduled for completion in autumn 2009.

For more information on these projects, contact Jasper Faber: +31 15 2150 150.

The Dutch capital, Amsterdam, has set itself a robust climate target: in 2025 the city intends to emit 40% less CO₂ than in 1990. It is an ambitious target, especially when you consider the city’s population is growing and its energy consumption is still on the rise. Merely reversing the historical trend of emissions growth would in itself be quite an achievement. To get a better handle on the feasibility of its aspirations, in 2007 several municipal services of Amsterdam asked CE Delft to provide a critical appraisal of the ‘stepping stones’ and measures required to get the city from the current situation to the CO₂ cuts envisaged for 2025. In a subsequent study CE Delft examined how the city can make even better use of its waste heat. If Amsterdam’s two heat grids were connected, this would form a solid backbone for substantial energy savings through better utilisation of waste heat.

As both parties were very happy with the collaboration, Amsterdam city council and CE Delft have now signed a small framework contract under which the city can direct all its queries relating to heat issues to CE Delft and expect a rapid reply. CE Delft will also be helping the Amsterdam Climate Office set up a system for monitoring the results of all the various efforts. In addition, CE Delft is providing expertise on possible implementation of large-scale solar cell projects and is involved in elaborating the vision of a ‘Smart Energy City’. Amsterdam wants to let its citizens and others experience what it will be like when the city is ‘climate-friendly’ in 2040. CE Delft’s task is to provide the technical substance for this appealing perspective.

Though 2040 is still a long way off, we’re already eager get there!

For more information on these projects, contact Cor Leguijt: +31 15 2150 150.

How are the tropical rainforests to be preserved? These unique ecosystems are among the most threatened in the world, posing a challenge for which there is no easy solution. It is one that CE Delft has been asked to address, though, on a commission from the Dutch environment ministry. The mission: to explore how economic instruments can be put to practical use as a road to conserving biodiversity. The economic perspective is important, because it is precisely here that major gains can be made. There are currently no markets for biodiversity, for example, and preservation of the tropical rainforest cannot be divorced from issues of local employment.

One possible strategy may be Steven de Bie’s idea to introduce a system of ‘tradable biodiversity rights’. Such a system would provide scope for generating income with which to develop ecologically sustainable uses for biodiversity resources. Conservation of biodiversity is of global importance and the EU is presently working on European policy to address the issue. CE’s task is to indicate what steps the EU can take in preparing for the forthcoming European policy package. The study is a 'practical exploration' of the idea of Steven de Bie for ways to implement biodiversity trade within the EU learning from EU-ETS for CO₂. 

For more information on this project, contact Geert Bergsma or Martijn Blom: +31 15 2150 150.

The European Commission’s plans to auction a substantial percentage of CO₂ emission rights rather than issue them free of charge will have scarcely any negative impact on Dutch industry at the macro-economic level. This is the result of a study carried out by CE Delft at the request of the Dutch ministries of Finance, Economic Affairs, Environment and Foreign Affairs. In the meantime, the European Council has decreed that most of the emission rights are nonetheless to be issued free of charge.

At the end of 2008 the Council came to a decision on how European climate targets are to be achieved, with the European CO₂ emissions trading scheme serving as one of the key elements. In the run-up to finalisation of these policies there was considerable opposition from industry to the plan to auction emission rights rather than issuing them free of charge. Companies feared a loss of competitiveness and a worsening of the investment climate.

The CE Delft study shows such fears are largely unfounded. For Dutch industry, auctioning European emission rights is likely to lead to an average cost price increase of 0.6%. It is anticipated that on average half this increase can be passed on to customers. This puts the net increase in costs to industry at around 0.3%. For the Dutch economy as a whole this means a direct loss of welfare of only about 0.2% of Gross Domestic Product (GDP).

The study does sound a word of caution, though, about the possible indirect impact of auctioning on GDP. Sectors like aluminium and steel as well as certain parts of the chemical industry may face above-average cost price increases that cannot be (entirely) passed on to customers. For these industries, then, the study also considers options for flanking policy to reduce impacts on competitiveness. Among the options available are border tax adjustments, free issue of emission rights and targeted redistribution of auctioning revenues.

For more information on this project, contact Sander de Bruyn: +31 15 2150 150.