The crisis in Ukraine has led to widespread calls for the European Union to accelerate its energy transition, increasing the uptake of renewable energy and boosting energy efficiency in order to reduce Europe’s dependence on energy imports. This is seen as going hand-in-hand with Europe’s ongoing efforts to reduce emissions, in the framework of the Paris Agreement and the EU Green Deal, which are also reflected in the package of legislative proposals known as ‘Fit for 55’.

The vast majority of stakeholders in the European energy community agree on the end goal – net zero emissions by 2050. The potential pathways and milestones towards net-zero emissions are currently under debate and these will also depend on the specific conditions in each country. Concerns in relation to energy security and affordability must also be taken into account.

Although the goal of decarbonisation is widely accepted and supported, there remains a need for policymakers to take a balanced approach. Yes – it’s important to invest in renewable sources of energy, but we are still a very long way from such sources being able to meet 100% of the energy needs of all Europe’s households and businesses. Therefore, we also need to look for ways to save energy and reduce emissions by choosing the most efficient technologies. Especially in today’s circumstances – Europe simply cannot afford to continue wasting energy!

Despite ambitious energy efficiency legislation being passed at EU level (the Energy Efficiency Directive of 2012 and its revision in 2018), Europe has made slow progress and only just met its 2020 target for cutting energy consumption due to the coronavirus pandemic. Currently, the European Parliament and the Member States are looking closely at the details of a new Energy Efficiency Directive (EED), based on a text that was put forward by the European Commission last summer, as part of the ‘Fit for 55’ package.

The Commission’s proposal for a new EED seeks to reconfirm ‘energy efficiency first’ as an overall principle of EU energy policy. It includes ambitious and binding targets for reducing energy consumption in the current decade by obliging each Member State to deliver annual energy savings across all sectors – including buildings, industry and transport.

The Commission’s new text echoes the previous EED in stating that “high-efficiency cogeneration and efficient district heating and cooling have significant potential for saving primary energy in the EU”. The cogeneration sector – represented by COGEN Europe – is ready to play its part in helping the EU and its Member States to reduce their energy consumption by offering efficient technologies that provide communities and businesses with the electricity, heat and cooling capacity they require – precisely where and when these are needed.

Cogeneration, also known as Combined Heat and Power or CHP, is the simultaneous production of heat and power. The technology optimises the use of any thermal source – including gases, bioenergy, hydrogen, waste heat, geothermal or solar thermal – by minimising the amount of energy that is wasted. CHP reduces emissions by displacing power plants and boilers that are less efficient and more polluting. By producing dispatchable electricity, CHP can complement clean energy solutions like heat pumps, solar (PV) and wind.

Today, cogeneration provides 12% of all the electricity used in Europe and 16% of all the heat. CHP is the best available technology of wide range for industries that need a continuous supply of process heat, including chemicals, pulp and paper, food & drink, ceramics and alumina. CHP also plays a significant role in the building sector – either via district heating networks or micro-CHP solutions. The public sector is also reaping the benefits of cogeneration – including the main EU institutions, which all rely on CHP to heat and power their Brussels headquarters.

Crucially, in the context of the EU Green Deal and Fit for 55 – cogeneration is a future-proof technology that will maximise the efficiency of any thermal energy source. Already today around one third of Europe’s CHP is driven by renewable and low-carbon energy sources. Modern CHP units have the capability to switch from natural gas to renewable gases and hydrogen, as these become available. Regardless of which fuel one chooses to use – decentralised CHP is the most efficient solution for delivering electricity and heat (or cooling) to households and businesses.

As Europe advances along the road to net zero, cogeneration can play a central role in helping to achieve a decarbonised, efficient and resilient energy system. It will be especially important for decarbonising heat across industry, buildings and district heating, wherever renewables-based electrification is not feasible. CHP also represents the most efficient source of flexible electricity, complementing intermittent renewables such as wind and solar (PV), and reducing or even eliminating the need for new gas-fired or nuclear power plants.

Cogeneration is essential for ensuring that renewable fuels such as biogas, biomethane and green hydrogen are used in the most efficient way – delivering the maximum amount of useful energy to households and businesses. According to a study commissioned by COGEN Europe in 2020, promoting the Europe-wide uptake of CHP could lead to cost savings of up to € 8.2 billion per year as part of a net-zero emissions Europe by 2050.

For Europe to meet its emissions targets and reach net zero, efforts to reduce demand for energy and increase the uptake of renewables must be accompanied by measures to ensure energy is produced and managed as efficiently as possible. The new Energy Efficiency Directive (EED) has a crucial role to play in driving efficiency gains across the entire energy system – including conversion, transmission, distribution and final use. In this context, the EU should prioritise cogeneration in order to ensure the most efficient use of all thermal energy sources.

Hans Korteweg, Managing Director of COGEN Europe

Published on 7 April 2022