To make Power-to-X a true success, everyone has to learn a (few) new words: Sector coupling
Power-to-X is on everyone’s lips these days and indeed, the new technology offers promising prospects for storing renewable energy and green fuels for transport. But at a hearing in the Danish Council for Climate, Energy and Utilities on February 25, GreenLab CEO Christopher Sorensen argues that we need to think of the individual parts of our energy system as a whole before Power-to-X can really become a gamechanger. It is this holistic approach that is called sector coupling – and at GreenLab, it is already happening.
If you thought that the green transition was all ready to go now that Power-to-X has officially been proclaimed the big hope, that is unfortunately not the case. There is no doubt that Power-to-X (or PtX) is an important part of the solution when it comes to achieving the ambitious 70% reductions – PtX makes it possible to store excess energy from renewable sources.
However, before planning new PtX plants and expanding existing ones, we need to consider how to design the infrastructure of our energy system in the future. Only then are we in the process of an intelligent green transition, says Christopher Sorensen, CEO of GreenLab – Denmark's first green industrial park and home to one of the world's first and largest production facilities for Power-to-X.
Think of the energy system as an old-fashioned household
Sector coupling can be explained by comparing it to a farmer's kitchen in the 1950s. The most important thing here was that nothing went to waste. The vegetables were fertilized with the leftovers of the animals, and once the vegetables were eaten, the remains went to the chickens, who in turn provided eggs as a thank you. Everything on the pig was used – even the hairs – and in late summer, produce was pickled, and autumn apples were placed in cool storage so they could be enjoyed throughout the winter. If we are to really benefit from new green technologies, we must start thinking about our energy system in the same way.
Christopher Sorensen explains: "We are used to thinking of the energy sector as a series of silos – e.g. the gas sector, the heating sector and the electricity sector – and for many years we have been focused on creating savings within each silo. But we need to think about the energy sector in a more holistic way, if we want to bring about a profound change. We have to rethink how energy is produced, stored and used across the silos. If we succeed, then we can store excess energy from one type of energy in another sector before it is used in a third, and that means energy is never wasted. For example, we can utilize the CO2 from existing biogas and CHP plants in Power-to-X production. And the excess heat from hydrogen production made with electrolysis can go into district heating systems. We must constantly think about our energy system in circular terms."
GreenLab is a green industrial park where companies share their excess resources via the so-called SymbiosisNet – one company's excess heat is another company's heat source. GreenLab's model is 100% circular and has no energy waste – renewable energy is either used directly by the connected companies in the industrial park or used via electrolysis to produce PtX fuels for agriculture, heavy transport and industrial production. In this way, GreenLab's energy-producing community of small and large production units that can share energy – combined with an infrastructure that can act as a "buffer" and store energy – is the solution to how all the world's energy assets should ideally be linked together to optimize resource consumption and avoid unnecessary CO2 emissions.
The Power-to-X paradox
However, the report Recommendations for a Danish Strategy for Power-to-X from Danish Energy (November 2020) describes the Power-to-X paradox that makes GreenLab press on at the hearing on February 25, 2021. On the one hand, the consumption side will only demand PtX-products when the price of the products is competitive.
On the other hand, products only become competitive when production is scaled up – and it only happens when there is certainty of customer demand for the products. Therefore, political action must be taken if Denmark is to join the PtX-adventure.
The stakes are high for the politicians
"It takes foresight and political courage to speed up the transformation of our energy system. Not only should we invest in new technologies – the very regulatory framework within which the renewable energy is produced must be redesigned", says Christopher Sorensen.
Today’s regulatory framework does not make it sufficiently attractive and profitable to invest in large-scale production and storage of green energy. And we need new mechanisms to create the necessary incentives in the market. At the same time, we need heavy investments in research that can propel Denmark into the major league in this area – a very profitable export adventure awaits if we succeed.
- By 2027, all electricity production in Denmark will come from renewable energy sources. This requires more renewable energy and opens up the possibility of developing new climate solutions based on green power.
- Power-to-X is the term for a technology that converts green power from wind and solar into hydrogen via electrolysis. The hydrogen can then be turned into green fuels for aircrafts, ships, trucks and industry
- The hearing on February 25 in the Council for Climate, Energy and Utilities will provide an insight into how experts, organizations and market players from different industries relate to the development and use of Power-to-X and what policy recommendations and expectations they have for the future Danish strategy.
- The hearing is attended by Mads Nipper (Ørsted), Thomas Woldbye (Copenhagen Airports), Tine Kirk Pedersen (Danish Ports), Lars Aagaard (Danish Energy), Anne Marie Damgaard (Danish Centre for Energy Storage), Ditte Juul Jørgensen (Director General of DG Energy, European Commission), Jens Bjørn Andersen (DSV Panalpina) and Christopher Donald Sorensen, (GreenLab Skive)