Energy transition: an RTE report with questionable assumptions Newsletter

Employment and social policies

October 27, 2021• Philippe François• Sandrine Gorreri

ReactShare

TwitterFacebookGoogle+LinkedIn

Reading comfortReading comfortPrint

Based on the six energy transition scenarios defined in June 2021, the Electricity Transport Network (RTE), the national manager of the electricity network, published on October 25, 2021 the assessments of their feasibility and their economic consequences, always with the aim of achieving carbon neutrality by 2050 and the objective of halving energy consumption by 2050, compared to its 2012 level. This work will be completed in early 2022 by more detailed data.

For each of the 6 electricity mixes varying from 50% to 100% renewable energies, and from 50% to 0% nuclear, the RTE report measures the economic consequences, assesses the possible differences, for example on the cost of MWh, and describes the environmental and societal impacts. There remain the basic assumptions on which this report is based, which raise two basic questions: the level of consumption and the evaluation of the intermittency in the cost of energy.

The study called "Energy Futures 2050"[1] draws up six scenarios that are supposed to make it possible to achieve carbon neutrality by 2050.

As a reminder, the current electricity mix (2019[2]) is as follows: Nuclear: 71%; Solar: 2%; Wind: 6%; Fossil fuels: 8%; Hydraulics: 11%; Other bioenergy: 2%.

Each of the scenarios aims to ensure security of supply for the French electricity system comparable to its current level. In all cases, RTE ensures that it has retained “prudent” data.

By seeming to recommend a balanced solution of "old and new nuclear + the whole range of renewables" production methods, RTE should satisfy the vast majority of French people, but the hypothesis concerning the reduction in energy consumption on which all the scenarios believable?

Decrease in energy consumption

The RTE report is aligned with official assumptions regarding the long-term economic and social environment, and with the objectives set by governments regarding the energy transition. The fundamental objective of the energy transition is to gradually reduce the level of CO2 emissions to achieve carbon neutrality by 2050. To achieve this, a second objective has been set: to halve energy consumption in 2050 compared to 2012.

https://www.statistiques.developpement-durable.gouv.fr/chiffres-cles-de-lenergie-edition-2021

The hypotheses relating to energy consumption seem to have particularly divided the authors of the study: instead of a 50% drop in final energy consumption in 2050 compared to 2012 as defined at COP21 and in the National Low-Carbon Strategy, the RTE report is based on an objective of reducing consumption by 40% in 2050 compared to “today”. On this basis, the target for 2050 would be 930 TWh instead of the official 810 TWh. If “today” means 2020 or 2021, the COVID crisis makes this data fragile.

In any case, these strategies assume gains in terms of energy efficiency but also a strong electrification of uses (transport, housing, etc.). The so-called reference trajectory targets an electricity consumption of 645 TWh in 2050 – compared to nearly 475 on average over the past decade. But RTE has also studied two variants: one called sobriety (555 TWh) and the other reindustrialization (752 TWh) with a strong hydrogen component.

For population change assumptions, RTE relies on official INSEE data. But RTE's proposal to reduce the GDP growth target from 1.7 to 1.3% between 2030 and 2050 is not in line with the government's objectives, supported by the various recovery plans underway. This rate (1.3% or less) corresponds to the situation where the fundamental reforms essential to France would not be carried out. It is not sufficient to ensure the financing of our social model, to redress the public accounts and above all to satisfy the legitimate aspirations of the French people, as shown by the rise in current demands concerning income: 1.5% constitutes an insufficient minimum level, it is at least 2% that our country must aim for and achieve. Even with only 1.5%, the rapprochement, by 2050, between +50% GDP and -50% final energy consumption is particularly appealing.

	Population	GDP	Final energy consumption
Growth / year	0.3 to 0.4%	1.5%	-1.4%
2012	65 million	€2,100m	1620 TWh
2050	71 million	€3,200m	810 TWh
Variation	+10%	+50%	-50%

When compared with population and especially wealth data, the objectives of reducing energy consumption take on their full meaning: halving the consumption of energy in France between 2012 and 2050 is a real challenge; but to do so while increasing the GDP in constant euros by half, and the population of 6 million people with 5 million additional households, is hardly credible.

In this context, it is curious that to confirm its forecasts, the RTE report does not take into account the virtual stability of energy consumption since 2012 (diagram below). In 2020, final energy consumption fell by only 3.5% (2012: 1,620 TWh, 2020: 1,562 TWh) despite weak French growth and the recession linked to COVID. To reach -50% in 2050, it should have already fallen by 13%, knowing that if energy saving expenditure is increasing, its efficiency is decreasing, the most profitable actions having logically been carried out first.

Source: https://www.statistiques.developpement-durable.gouv.fr/edition-numerique/chiffres-cles-energie-2021/pdf/pages/partie2/partie2.pdf

Cost of intermittent productions

The authors of the RTE report call on politicians to make quick choices among the multiple options open to them, as the report allows them to make informed decisions quickly even if they remain risky. Indeed, whether it is the renewal of the nuclear fleet or the all-renewable option, these routes involve heavy investment. According to RTE, all the scenarios require a massive investment: over 40 years, it will be necessary to invest between 750 and 1000 billion euros depending on the scenario chosen, to supply the country with electricity, i.e. 20 to 25 billion €/year. Over the entire period between 2020 and 2060, there is a gap of more than 200 billion euros between the scenario requiring the most investment (M1) and those requiring the least (N2 and N03). This is a differential of five billion euros per year, to the advantage of scenarios with a nuclear share.

And the report adds: "all the components of the system are concerned: electricity production, means of flexibility (electrolyzers, hydrogen networks and stocks, thermal power plants, batteries, demand management system), transmission and distribution". An important precision which shows that the cost of energy is not limited to the operating cost of the mode of production.

At a time when the price of energy and its increase is on everyone's mind, RTE explains that these investments (based on the consumption assumptions used in the report) would lead to an increase in the overall cost of the MWh by around 15% excluding inflation (median). However, this projection is subject to two reservations: a low financing cost. The report indicates that “the current macroeconomic conditions, combining low interest rates and higher fossil fuel prices, are particularly favorable to an investment policy in low-carbon energies”. But is this environment likely to remain stable in the coming years?

On the other hand, between the bottom and the top of the range of long-term electricity system costs, it is essentially the costs of flexibility and those of the networks that make the difference. One of the strengths of the report is its assessment of the full cost of intermittent energy in France.

The RTE diagram (page 31) indicates, for each of the 6 scenarios, the full cost of the MWh produced. By limiting ourselves to the two extremes (M0 and N03) corresponding to the maximum and the minimum of renewables, we see that the share of flexibilities and transport and distribution networks is much higher in the M0 scenario. In total, the electricity production costs are almost the same in both cases (about 38 billion euros), but the ancillary costs are half as high in the M0 scenario.

It is of course the consequences of intermittency that the new data are most interesting. In 2021, for example, electricity consumption varied from 29,660 MW on August 8 at 7:00 a.m. to 88,440 MW on January 11 at 9:30 a.m., underlining the need to produce when consumers demand it. Electricity prices vary accordingly: for an average of €35 to €50/MWh, prices regularly reach hundreds of euros. Records were reached with negative prices in 2020, and +1939 €/MWh on February 12, 2012, underlining the interest there is in producing when there is strong demand.

In total, at the gross production cost of MWh, intermittent production must take into account five additional costs: utility coefficient less than 1 + network balancing cost + storage cost + load shedding cost + power plant cost on stand-by. These official data from RTE should bring some order to the highly variable figures quoted by experts and politicians, taking advantage of great confusion: costs in France or in foreign countries where the conditions are totally different (eg. Saudi Arabia for solar power, Denmark for offshore wind power), dates taken into account (past, present or future), plants considered (stock or new installations) and inclusion or not of additional costs linked to intermittency.

Conclusion

The RTE study was carried out under the constraint of strictly respecting the objectives that France set itself at COP21, in the Energy Transition Law for Green Growth and in the various Multiannual Energy Programmes. At the level of France, the massive investments, the additional costs and the considerable lifestyle changes they imply will be very difficult for the French to assume. At the global level, many countries are not meeting the commitments made at COP21, either because they do not want to or often because they cannot, given their social and economic situation. The yellow vests crisis and the current energy price crisis throughout Europe have shown that even in highly developed countries, imposing new so-called “virtuous” constraints on the standard of living is very poorly supported. We can imagine what is happening in countries in great difficulty in Africa, South America, Southeast Asia or Eastern Europe...

< /table>

Faced with this degraded situation and the certainty that global warming will occur, France should revise its plans and better distribute its investments: reduce those relating to the direct fight against global warming in France, increase its research efforts on solutions applicable in France and in foreign countries, particularly in developing countries, and better prepare our adaptation to global warming.

By declaring that "Countries' efforts must be multiplied by four to keep the 2°C target within reach and by seven for that of 1.5°C" one of the main UN Environment Program experts, and author of the preparatory report for COP26, unwittingly confirmed that these goals will not be achieved.

RTE, under orders?

This question inevitably had to arise before and after the publication of the RTE reports. The main suspicion is RTE's allegiance to its majority shareholder EDF. During the preparation of the National Low Carbon Strategy and the Multiannual Energy Program, this suspicion was hardly credible, the representatives of RTE directly opposing those of EDF in public. Above all, RTE seemed to want to defend at all costs the energy transition law for which the deputy François Brottes had been the rapporteur at the National Assembly, before being appointed to the presidency of RTE. In July 2020, Xavier Piechaczyk, engineer from Les Ponts, senior civil servant and expert on the subject of energy, was appointed chairman of RTE. To reduce tensions, he seems to have been keen to surround himself with multiple committees where many voices were able to express themselves.

At the service of all electricity producers and consumers, RTE should logically be a completely independent company. This is what the European Commission (and iFRAP) had requested for EDF's Hercule reorganization plan. Instead, an opaque “Chinese wall” is supposed to exist between EDF and RTE, which leaves room for many doubts.

It remains strange that France's energy strategy is entrusted to the electron carrier. As if it were the SNCF network or Air France which, instead of dealing with their transport capacities, were going to define the transport needs for passengers and goods in the country.

Top Risks

For its assessments, RTE considers that it has surrounded itself with the best experts but recognizes that there are still many unknowns and risks inherent in technologies under development.

Nuclear: EPR or comparable nuclear power plants have recently been built in China, Russia, and the United Arab Emirates. The main risk concerning future French EPRs lies in the ability of EDF and its subcontractors to become as efficient as in the years 1975-1995. Sites where nuclear power plants are currently operating are generally very favorable for the construction of new power plants.

Renewables: The development capacity of onshore and offshore wind turbines depends on their social acceptability, as can currently be seen in France, and on the scarcity of sites most conducive to this activity. Marine floating power plants are being tested, and RTE insists on the need for a strong improvement in their competitiveness. For photovoltaic power plants, which are less visible from afar, it is land take and competition with other land users (housing) that can limit their expansion. The full efficiency of intermittent energies presupposes very significant progress (factor 3 to 5) in batteries, the hydrogen sector and the cogeneration sector.

For the massive development of gas, electricity and heat production from biomass, it is the availability of biomass that is questioned: it is already highly sought after by farmers to enrich their land, for breeders to feed their animals and by chemists to replace plastic and other petroleum derivatives.

[1] https://assets.rte-france.com/ prod/public/2021-10/Energy-Futures-20...

[2] We have chosen 2019, a more standard year than 2020

React

By validating this form, I consent to the processing of the data provided as part of their use for site comments, as explained in the privacy policy

Comment Status

Will be displayed on the site

* Mandatory information. Your email address will not be displayed on our website.

Comments

Parpierre reiller •Posted on 04/11/2021 at 14:03 Thank you for this article which complements well what has been said in the press; which forgets the imposed constraint of lowering energy consumption. (Curious idea for anyone going towards renewable energies!!) What struck me is the small differences between the scenarios: everything is worth the big uncertainties close to this kind of reviews! To oppose the wind hazard to the docility of nuclear power is to forget a few details that are nevertheless very present today: the availability of French nuclear power is weak, more and more,... and what to think in the event of the slightest serious incident! no solar today, but which should grow quickly, like mushrooms in the rain!

ParLION 69 •Posted on 03/11/2021 at 15:15 It's been a long time since RTE no longer made serious forecast reports. It is under the orders of the MTES. Moreover, its President has clearly declared that he was walking hand in hand with ADEME and Négawatt!

ByMichel •Posted on 03/11/2021 at 13:44 Thank you and bravo for this relevant analysis TEN report. The technicians did a remarkable job, framed by politically correct hypotheses, under the watchful eye of EdF no doubt, but more surely of B.Pompili! You could have underlined the fantasy shown by politicians in reading the results. Thus, the study establishes that the scenario with the most nuclear power is the most efficient in terms of climate and economics, ensuring the best stability of the network and guarantee of availability, etc. In short, the scenario rich in nuclear power is the best. What a pity that the ministry has imposed (underhand) to stick to the SNBC and the 50% max of nuclear power. It would have been interesting to study the scenario with 70 or 80% nuclear power. No, it's forbidden! Funniest is the conclusion drawn by the Minister: Knowing that the more nuclear power there is, the better it is, B.Pompili affirms without batting an eyelid that massive development of renewable energies is needed. A bit of intellectual honesty could have led her to regret that the decisions to commit new tranches that should have been taken a long time ago have always been postponed. His ideological stubbornness is already being paid for and will be paid for very dearly in the future! Thank you for your always fascinating forums. . •Posted on 10/30/2021 at 1:40 p.m. or not!

ByPh52 •Posted on 10/30/2021 at 12:19 p.m. We should question the figure of 50% of the maximum share of nuclear energy .The optimum of the "energy mix" is perhaps 60%, or even two-thirds....