20 November 2024

COGEN Europe (the European Association for the Promotion of Cogeneration) held its Annual Conference in Brussels on 14 November 2024. The Conference was closed by Stefan Liesner (Head of Marketing and Public Affairs, 2G Energy AG), who was speaking in his capacity as a member of COGEN Europe’s Executive Committee. Below we provide an edited transcript of Mr Liesner’s remarks.

Many thanks to COGEN Europe for inviting me to present the conclusions of this year’s Annual Conference. It was great seeing so many of you in person and to engage in lively debate around the panel discussions and during the networking sessions.

First of all, let me start with some personal impressions. From a German perspective the recent week was quite intensive. We were following the US elections, of course, and on the same day Germany’s coalition government collapsed. Moreover, we saw the images of the flooding in Spain and the huge tragedy for the people in the affected areas. I herewith express my deepest personal condolences to all colleagues from Spain who are here today. However, I think all these events are certainly linked to one another:
• People are aware of climate change
• People want to fight against climate change
• But, people are also scared for Europe’s economic future in the context of increasing competition from other parts of the world.

Earlier this week (11-12 November) the annual congress of the German Cogeneration Association B.KWK took place in Berlin. And for the first time in a few years we had the feeling that cogeneration is ‘back on track’ in the political landscape and is again seen as a future solution rather than an old-fashioned technology. Because cogeneration enables us to combine climate protection AND economic viability.

This was also my impression of today´s conference: the same seems to apply for the whole of Europe. We have heard from many high-level speakers: policymakers, senior executives, representatives of the paper, ceramics and sugar industries were with us today, sharing their cogeneration stories and future visions. The same goes for the district heating sector. We thank them for their valuable contributions and insights. We welcome the high-level support for the cogeneration sector at political level. This reflects the sector’s commitment to excellence, innovation and decarbonization, as well as to our customers.

We are pleased that representatives from the European Commission and the European Parliament joined us to kick start our conference with positive messages stressing:
• The good track record of cogeneration in terms of delivering energy efficiency and emission reductions;
• A commitment to more work in the field of cogeneration, notably in relation to the uptake of renewables, flexibility and further increases in efficiency;
• The willingness to combine competitiveness with the Clean Industrial Deal;
• Recognising the important role that cogeneration can play in contributing to Europe’s industrial competitiveness which is increasingly perceived as one of the top priorities of the European Union;
• ‘Going Local’ by mobilising local leaders and industries to drive ambitious action and investments;
• The upcoming debate on the 2040 emissions target and legislative framework;
• The need to ensure predictability for European industries and providers of clean energy solutions.

We have many reasons to be optimistic today. Cogeneration has been a key energy efficiency solution during the past decades. The role of cogeneration will change in the coming decades, but it will remain an important technology to enable an efficient pathway towards a net zero emissions energy system.

Industry executives speaking today have shown their commitment to providing cogeneration solutions that are future-proof.
• We have heard that cogeneration is key for energy systems’ resilience, affordability and competitiveness moving forward.
• There is substantial innovation in the cogeneration sector, focusing on digitalisation, renewable fuels, hydrogen, carbon capture and storage (CCS), flexibilization and optimisation with other decarbonisation technologies.
• Artificial intelligence (AI) solutions will play a crucial role in helping to integrate cogeneration technologies in the energy mix of the future.
• Moreover, cogeneration can help to foster the gradual transition of gas distribution grids towards climate neutrality. On a technological level, modern CHP plants are able to cope with all kinds of gases.
• On the consumption side, we see traditional applications continuing to rely on cogeneration as their technology mix diversifies. We also see new customer profiles emerging, such as data centres.
• There is no one solution that will help us get to net zero emissions, be it hydrogen or heat pumps, batteries or grids, solar or wind. Innovative energy solutions – whether in industry or at utilities – combine cogeneration with all of these technologies. In particular, the combination of CHP plus heat pump becomes increasingly important.
• There was consensus among our speakers today that we need technological openness and synergies that will allow industry to rapidly deploy and optimise all relevant solutions, in order to deliver emission reductions cost-effectively, whilst maintaining system reliability.

What about the users of cogeneration?
• Energy consumers are becoming increasingly aware of environmental objectives and even more aware of energy costs and their impact on competitiveness. Jointly addressing sustainability and competitiveness will be critical for the future of cogeneration.
• Energy costs and security of supply are still the main factors driving investment decisions.
• There is an overall willingness to electrify. However, this won´t happen overnight – due to grid capacity as well as financial viability.
• Previously, CHP applications in industry have mostly been operated according to on-site demand for heat and electricity. This will change as we move towards a deeper integration into the wider electricity market, but for this to happen also requires an adequate legislative and regulatory framework.
• The security of investments depends on having an ambitious, comprehensive and stable policy framework at EU level and also in each of the Member States.

Against this landscape, challenges still remain, such as:
• Avoiding the trap of taking a ‘silo approach’ to energy systems, which fails to take account of the synergies between electricity and heat;
• Ensuring affordability and competitiveness, as CAPEX (capital expenditure) becomes more important than OPEX (operating expenses) in driving the development of our energy system;
• Addressing the lack of legislative certainty in some areas such as in relation to the uptake of renewable and low-carbon fuels, or the continuity of policy incentives.

The start of a new legislative term at EU level and across many national political landscapes, presents important opportunities for the cogeneration sector. To sum up:
• The cogeneration industry is committed to delivering on high ambitions when it comes to decarbonisation and emission reductions.
• We need to find solutions that meet the needs of individual customers, in order to break down silos and ensure consumer acceptance and engagement.
• Our role, as COGEN Europe, is to share this message and make it understandable. We must spread the word among decision makers and with stakeholders across the whole energy value chain.

Let me close with a saying that was brought up by Kelvin Ross during the first panel discussion this morning: ‘Think Global – Act Local’. I think this is the approach we need in these demanding times!

 

 

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