XXIst World Energy Council Montreal 2010
Energy Mix in Central European Countries of the V4 Group: The Quest for Stability Prof. Ing. František Janíček, PhD., Mgr. Miroslava Smitková, PhD., Ing. Juraj Kubica* Slovak University of Technology in Bratislava, Faculty of Electrical Engineering and Information Technology, Department of Electrical Power Engineering, Ilkovičova 3, 812 19 Bratislava, http://www.kee.fei.stuba.sk/ * Corresponding author, email: [email protected]
ABSTRACT The paper examines the development of the energy mix in the countries of the V4 region (Czech Re- public, Hungary, Poland, and Slovakia). Trends over the past two decades are summarised and criti- cally examined but mainly possible energy scenarios by 2030 are presented and assessed. Based on existing scenarios for the V4 countries, the impacts are assessed of potential developments for various ratios between domestic and imported fossil fuels, nuclear sources and large and decentralised RES. The analysis spans the development in energy intensity of the national economies, structural changes in energy consumption in various areas such as the industry and households, tightening of environ- mental criteria and a reevaluation of the dependency on imports of primary energy sources with an outline of possible future development directions in power engineering in view of the liberalisation of energy markets.
Keywords: energy sources, energy mix, energy policy, liberalisation, renewable energy
INTRODUCTION The balance between demand and supplies of various forms of energies in countries of the Central European region (Czech Republic, Hungary, Poland, and Slovakia) is maintained within the context of fast changing societies. Over the past 20 years, the countries have undergone a transformation from cen- trally planned to market economies but also and primarily integration into pan-European structures. However, there remains a high dependency on imports of energy commodities specifically comprising crude oil, natural gas and nuclear fuels from suppliers in the east. The energy dependency became manifest in January 2009 as natural gas supplies were suspended in the wake of a dispute between Russia and Ukraine. In the past already, supply-related issues occurred in 2004 and 2006 yet those remained limited to partial irregularities only. The above gas crisis exposed the weak links in the system but also became a testimony to the strength and solidarity of the European Un- ion. The crisis outcome has been the funding of the construction effort towards the South Stream pipeline to supply Russian gas to Europe via the Black Sea and Balkan route. The Russian gas monopoly Gaz- prom has already signed a deal with the Hungarian national development bank on building the section of the pipeline. [32] Liberalisation of the energy market has been one of the most protracted and controversial processes in the EU legislation. The Commission has been driving towards the creation of a common European en- ergy market already since the early 1990s. The supporting arguments span improved competitiveness, promotion of job creation and lower energy prices. In the V4 countries, liberalisation coincided with the privatisation of power utilities and the formation process of the political landscape. This has not been a particularly fortunate combination for the developments in the energy sector. Foreign privatizers have gained control of the goings in the energy markets, which at times runs contrary to the original ideas be- hind market liberalisation. Ownership changes of power facilities over the course of the liberalisation process of the energy markets have brought up a number of issues arising out of given cultural and his- torical contexts. A number of strategic partnerships have been emerging and a number of commercial players have risen frequently out of speculative motivations. The particular combination of liberalisation and privatisation in this context and at present stage hence appears problematic.
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The energy sector in the communist era in all the four countries was controlled by state-run monopo- lies that have been gradually broken up after the fall of communism into separate enterprises and sold to various degree to foreign investors who became operators of the utilities. Currently the process of im- plementation of market principles in the energy sector is still ongoing as mainly directed by the EU poli- cies. The national energy strategies are being integrated EU directives and regulations and pursuing the lead of the European Union (EU). With EU accession, business chances have expanded for the countries in power engineering yet there is also a much tougher market competition to beat.
Fig. 1 Reference map showing the locations of the V4 countries in Europe. Credit: University of Texas at Austin
Tab. 1: Energy dependency of the V4 countries on imports of primary energy sources* [18] 1990 1996 2000 2007 Country (%) (%) (%) (%) Czech Republic 15.7 24.5 23.4 25.1 Hungary 50.4 52.6 56.1 61.4 Poland 2.2 5.2 11.2 25.5 Slovakia 76.7 74.3 66.0 69.0 *Energy dependency shows the extent to which an economy relies upon imports in order to meet its energy needs. The in- dicator is calculated as net imports divided by the sum of gross inland energy consumption plus bunkers.
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1 ENERGY MIX OF THE V4 COUNTRIES As of 15th February 1991, the four countries of the former communist bloc – the Czech Republic (CR), Hungary (HU), Poland (PL) and Slovakia (SR) – have been participating in the Visegrád Group alliance, also known as V4. The countries have entered cooperation for the purpose of furthering the European integration process and the transformation of their national economies. As major strengths of the countries not least from energy point of view, their favourable location at the heart of the EU and good relationships with Russia as a major player in the markets with energy commodities apply. Their shared weaknesses include political instability and underdeveloped infrastructure. In terms of consumption of primary energy sources in the V4 countries, fossil fuels are in the lead. Poland up to recently was among the leading producers of coal fuelling its thermal power plants it has been relying upon as a key power source. Slovakia along with the Czech Republic has a reasonably ad- vanced nuclear sector as distinguished by low greenhouse gas emissions. The V4 countries in terms of electricity production generally score a negative balance. Hungary has been reporting a net deficit since several years already while Slovakia has been a net importer since 2007 when for political reasons, it was forced to shut down 2 of its nuclear power units. Poland is a minor ex- porter and the Czech Republic is due to lose its preferable exporter status between 2014 and 2019.
Tab. 2: Energy consumption in the V4 countries in 2006 Solid Oil Natural Nuclear RES Country/Fuel fuel gas Mtoe Czech Republic 20.9 10.0 7.6 6.7 2 Hungary 6.0 7.8 11.5 3.5 1.3 Poland 57 24.2 12.4 – 5 Slovakia 4.4 3.7 5.4 4.6 0.9
1.1 Energy Mix of Czech Republic The energy mix of the Czech Republic currently Selected Indicators for the Czech Republic [20] Population: 10,211,904 (July 2009 est.) emphasises as mainstay sources of electricity the output 2 of nuclear plants and thermal power plants. Auxiliary Area: 78,867 km GDP per capita (PPP): $25,100 (2009 est.) sources include hydroelectric plants and pumping Electricity production: 82.72 TWh (2007 est.) plants as buffers in the daily grid load diagram. Electric. consumption: 61.65 TWh (2007 est.) Further development scenarios for the Czech energy Oil consumption: 212,800 bbl/day (2008 est.) sector project a further growth in nuclear and coal Oil imports: 213,900 bbl/day (2008 est.) power yet no less relevant also is the current boom in Gas consumption: 8.719 billion m3 (2008 est.) 3 connecting renewable energy sources to the grid mainly Gas imports: 9.573 billion m (2008 est.) in the form of wind parks and solar parks, driven not least by the current imbalance in set levels of on- grid prices in the Czech Republic against neighbouring countries.
1989 2008
Fig. 2 Breakdown of installed capacity of Czech power plants in 1989 and 2008; PE = steam, VE = hydro, JE = nuclear, PPE = IGCC [37]
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In 2008 according to preliminary data by the Czech Statistical Office, the Czech Republic consumed 1814.5 PJ worth of primary energy sources [35]. The consumption has been marking a slight growth in recent years except the last year’s slump likely in the wake of the economic crisis. Simultaneously, en- ergy intensity of the national economy has been on the decline in the long-term as a result of the ad- vancing structural changes in the economy and improvements in energy efficiency of technologies. The key series of changes in energy balance of the Czech Republic occurred in the 1990s, with the developments after 2000 already more stabilised except for the one major structural change in form of the operation startup of the Temelín nuclear plant. The trends after 2000 are visualised in Figures 1 and 2, indicating that the demand for primary energy sources driven by stronger economic growth has been dampened by a remarkable decline in energy intensity. After 2000, the national economy grew annually by 4.5% on average while the consumption of energy sources scored a mean growth of a mere 2% annu- ally. The fair growth in the consumption of primary energy sources over the past years has been the re- sult of not just faster economic growth but also of rising electricity exports (consumption of resources for electricity production, own consumption and grid losses). [10]
The Czech energy policy is defined by the following three principles [33]: 1. Independence: Independence of foreign energy sources; Independence of energy sources from instable regions; Independence of potentially unreliable supplies of foreign commodities. 2. Security: Security of energy sources including nuclear safety; Steady supplies of all types of energies; A rational decentralisation of power systems. 3. Sustainable development: Environmental protection; Economic and social development.
Fig. 3 Trends in net electricity production in Czech power plants over the period 1980-2008. Values are in TW. PE = steam, PPE = IGCC, VE = hydro, JE = nuclear [37]
The Czech Republic is one among the few net electricity exporters in Europe. According to projec- tions due to more stringent environmental provisions concerning coal mining and shutdowns of obsoles- cent facilities, the country is to lose its exporter status and become a net importer around 2014 to 2019.
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1.2 Energy Mix of Hungary The companies of the Hungarian power system, set Selected Indicators for Hungary [20] Population: 9,905,596 (July 2009 est.) up in 1949, were integrated into one economic unit, 2 the Hungarian Electricity Board (MVMT), in 1963. Area: 93,028 km GDP per capita (PPP): $18,800 (2009 est.) From 1992 onward, the companies in the trust were Electricity production: 37.74 TWh (2007 est.) reorganized into independent power plant and network Electric. consumption: 37.77 TWh (2007 est.) companies, yet remained under the control of MVM Oil consumption: 162,100 bbl/day (2008 est.) Rt. in a two-level holding form. In 1994, introducing Oil imports: 195,400 bbl/day (2008 est.) the “single buyer” model replacing the earlier inte- Gas consumption: 13.17 billion m3 (2008 est.) 3 grated company form, the new Electricity Act enabled Gas imports: 11.47 billion m (2008 est.) ownership-independent operation based on operation licences, thereby the privatisation of energy in- dustry companies. The amendment to privatization law in May 2005 imposed majority state ownership of MVM Zrt. group charged with power generation, system operation, trading and other activities. The transformation of MVM Zrt. into a holding in 2007 did not interfere with the independence in the transmission system operations. In a move towards fully opening the market, the Act LXXXVI/2007 on Electricity passed on 25th June 2007 and the market fully opened on 1st January 2008. [21] Recent years saw several major changes in Hungary that affected the national economy as a whole and along with it the energy sector. As in other V4 countries, following Hungary’s EU accession spe- cific amendments are due to its national power legislation. Over the past years, energy intensity of the Hungarian economy has declined significantly while also the environmental impacts have lessened of the energy sector. On the other hand, the nation re- mains dependent on imports of primary energy sources; specifically fossil fuels (see Tab. 1). Trends in primary energy consumption and electricity and heat consumption in Hungary are held in Fig. 4. The total Hungarian electricity consumption (including grid losses) was at 41.02 TWh in 2008. Compared to 2007, this amounts to an increase in gross consumption by 0.4%. [21] Tab. 3 shows fossil fuels having a major share in electricity production, with nuclear power not far behind. As at 31st December 2008, the installed capacity of power plants in the Hungarian power system to- talled 9139.8 MW. The figure has been a result of the capacity increase of reactor unit I in the Paks NPP along with the rising share of gas turbines and small power plants. Among the power plants in the Hungarian power system, the installed output of large power plants amounted to 85.48% of the system capacity, i.e. the share of small power plants rose by 0.78% against previous year.
Fig. 4 Primary energy consumption and energy consumption for electricity generation and heat supply in petajoules in Hungary over the period 1999-2008
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In 2007, the comprehensive national energy strategy by 2020 document was compiled for Hungary. The core focus points of the Hungarian energy policy include long-term stabilisation towards secure energy supplies, competitiveness and sustainable development [22]. Secure supplies: the key aim of the energy policy by addressing the following partial aspects: Structure of energy sources; Diversification in energy imports; Reserves of strategic energy carriers; Infrastructure advancements; Catering to the needs of the population, social security concerns.
For the sake of reliability and security of energy supplies apart from exploring domestic sources, security improvements are needed in energy imports and the creation of adequate emergency re- serves/provisions. Prerequisite to improvements in the security of supplies through emergency reserves for imported commodities are a diversification of resources, transport routes, energy carrier types used and mutual cooperation with export and transit countries. In terms of competitiveness, a fair and transparent environment should be created for Hungarian en- terprises to operate in. The energy policy aims at the energy sector contributing its fair share to rein- forcing the competitiveness of the national economy. The following partial aspects have been identified within the focus point: Liberalised energy markets, integration into a common EU energy market; Energy prices; Technical progress and advances in technologies.
Sustainable development: environmental and economic partial aims within sustainable development should be mutually aligned and include cooperation of the general public.
Tab. 3 Breakdown of electricity production according to energy sources in Hungary [21] 1990 2007 2008 GWh % GWh % GWh % Brown coal 4,607 16.8 762 1.9 920 2.3 Lignite 2,605 9.5 6,042 15.2 5,327 13.3 Hard coal by-product 942 3.4 546 1.4 681 1.7 Coal total 8,154 29.7 7,350 18.4 6,928 17.3 Oil 914 3.4 589 1.5 355 0.9 Natural gas 4,486 16.3 15,116 37.9 15,317 38.3 Hydrocarbons total 5,400 19.7 15,705 39.4 16 39.2 Fossil fuels total 13,554 49.4 23,055 57.8 22,600 56.5 Wind power - - 110 0.3 205 0.5 Hydro power 178 0.6 210 0.5 213 0.5 Biomass - - 1,488 3.7 1,818 4.5 Other RES+waste - - 340 0.9 371 0.9 Nuclear power 13,731 50.0 14,677 36.8 14,818 37.0 Total 27,463 100 39,880 100 40,025 100
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The following partial aspects have been identified within the focus point, in order of importance: Reduction in energy consumption (rationalisation in energy saving efforts, efficiency im- provements in energy production, efficiency improvements in energy consumption); Increase in the share of RES; Gradual implementation of environmentally friendly technologies.
The Hungarian national energy strategy builds on a significant share of nuclear energy in the long- term horizon. This includes further license renewals in order to continue operation of the Paks nuclear plant reactor units. In the future, the Paks nuclear plant is due to be extended with additional reactor units. However, the relevant prerequisite is effective final disposal solution for radioactive waste. Hungary is keen to participate in international research projects in the field of nuclear power while also the necessity is acknowledged of open information policy particularly towards the general public. The Hungarian energy strategy by 2020 outlines three possible development scenarios for the en- ergy sector [22]. Under Scenario I, annual GDP growth of 2.5% is projected; this translates into a total growth by 16.6% by 2020 with a growth in electricity consumption by 17.9% on assuming annual en- ergy savings of 1% adjusted for final consumption (1% growth in GDP = 0.401% growth in total, or 0.433% growth in electricity consumption). The projections under Scenario II expect a GDP growth of 4.5% annually with a total figure of 17.4% by 2020 and a growth in electricity consumption by 18.7% at presumed energy savings of 1.1% annually adjusted for final consumption (1% growth in GDP = 0.204% in total, or 0.220% growth in electricity consumption). Under Scenario III, an annual GDP growth of 4.5% is expected with a total figure of 18.2% by 2020 and a growth in electricity consump- tion by 19.6% on assuming annual energy savings of 1.5% adjusted for final consumption (1% growth in GDP = 0.165% in total, or 0.180% growth in electricity consumption). The projections for energy consumption and the shares of different sources in electricity production under the different scenarios are given in Tables 4 and 5. Tab. 4 Summary of electricity consumption projection scenarios [22] Key Data Total Energy Electricity Growth in electricity Energy Without Effect of With consumption per 1% Without Effect of With savings energy energy energy GDP growth in GDP energy energy energy growth savings savings savings Primary savings savings savings (%) Electricity Electricity (TWh/ (TWh/ (TWh/ energy (PJ/year) (PJ/year) (PJ/year) year) year) year) (%) (%) (%) Scenario 2.5 0.401 0.433 1.0 1346.0 98.0 1248.0 50.69 3.60 47.09 I Scenario 4.5 0.204 0.220 1.1 1356.0 108.0 1248.0 51.06 3.96 47.1 II Scenario 4.5 0.165 0.180 1.5 1317.0 147.0 1170.0 49.59 5.39 44.2 III
Tab. 5 Breakdown of electricity production in 2020 [22] Electricity Production in 2020 Liquid hydro- Total RES Nuclear plants Natural gas Coal, lignite carbons (TWh/ (TWh/ (TWh/ (TWh/ (TWh/ (TWh/ (%) (%) (%) (%) (%) year) year) year) year) year) year) Scenario 39.20 9.47 24.2 15.01 38.3 7.22 18.4 1.0 2.6 6.5 16.6 I Scenario 39.20 9.47 24.2 15.01 38.3 7.22 18.4 1.0 2.6 6.5 16.6 II Scenario 36.38 9.47 26.0 15.01 41.3 6.0 16.5 1.1 1.9 5.2 14.3 III
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1.3 Energy Mix of Poland Poland currently is a minor net electricity exporter Selected Indicators for Poland [20] Population: 38,482,919 (July 2009 est.) credit to substantial output of its coal-fired thermal 2 plants. Due to the tightening in environmental provi- Area: 312,685 km GDP per capita (PPP): $17,800 (2009 est.) sions applicable to both coal mining and electricity Electricity production: 149.1 TWh (2007 est.) production, operation is to be curtailed of coal-fired Electric. consumption: 129.3 TWh (2007 est.) plants which is why projections expect Poland to be- Oil consumption: 544,800 bbl/day (2008 est.) come a nation with a net electricity deficit in a matter of Oil imports: 595,400 bbl/day (2008 est.) years. Gas consumption: 16.55 billion m3 (2008 est.) 3 The principal coal-fired plants are concentrated near Gas imports: 11.2 billion m (2008 est.) brown coal mining locations, with the output of the largest thermal plant Belchatów at 4320 MW. In 2008, installed output of operational power plants in the country totalled 32 400 MW, thereof 92% thermal plants. As part of the restructuring effort of the domestic power grid, the first Polish nuclear plant has been in the planning. The national energy policy states: “Currently, the Polish energy sector is facing a number of serious challenges. High demand for final energy, inadequate generation and transmission infrastructure, de- pendence on external supplies of natural gas and crude oil, as well as commitments on environment and climate protection compel the country to take decisive actions.” In line with the needs, the primary directions of the Polish energy policy are as follows [32]: Improve energy efficiency; Enhance the security of fuel and energy supplies; Diversify the electricity generation structure by introducing nuclear energy; Develop the use of renewable energy sources, including biofuels; Develop competitive fuel and energy markets; Reduce the environmental impacts of the power industry. Improvement in energy efficiency counters the increase in demand for fuels and energy, hence is con- ducive to enhancing energy security by reducing the dependence on imports; it also reduces the envi- ronmental impact of the power sector by reducing emissions. The development of renewable energy sources, including the use of biofuels and clean coal technologies, and the introduction of nuclear energy bring about similar effects. In implementing measures in accordance with the above directions, the Energy Policy of Poland will strive for enhancing the country’s energy security observing the principle of sustainable development, i.e. development pursued to meet the energy needs of current generation without jeopardising energy supply to future generations, including the development of transmission, distribution, and fuel and en- ergy storage infrastructure. [32]
1.4 Energy Mix of Slovakia Selected Indicators for Slovakia [20] In 1988, the Slovak state-run utility enterprise was Population: 5,463,046 (July 2009 est.) formed under the name of Slovenské energetické pod- Area: 49,035 km2 niky Bratislava that gave rise in 1990 to the Zápa- GDP per capita (PPP): $21,100 (2009 est.) doslovenská energetika, Stredoslovenská energetika Electricity production: 26.53 TWh (2007 est.) and Východoslovenská energetika distribution compa- Electric. consumption: 26.81 TWh (2007 est.) nies which went on to become independent state-run Oil consumption: 84,990 bbl/day (2008 est.) Oil imports: 148,600 bbl/day (2008 est.) enterprises. The Slovak government ruled in May 2002 3 Gas consumption: 6.308 billion m (2008 est.) on privatising the enterprises, with a 49 percent share Gas imports: 6.266 billion m3 (2008 est.) in ZSE acquired through direct purchase by the Ger- man E.ON Energie AG, a 49 percent share in SSE by the French EDF and again a 49 percent share in VSE by RWE Plus of Germany. Slovenské elektrárne, a. s. was established as a stock corporation on 01/11/1994 as a legal successor of Slovenský energetický podnik, š. p. Slovenské elektrárne, a.s. (SE, a.s.) on its part gave rise on 21/01/2002 to Prenosová sústava (distribution system operator) and Te-
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pláreň Košice (local municipal utility enterprise), with the effective outcome of three independent en- terprises. Following the privatisation of SE, a.s. completed by signing the final contract in late April 2006, its stock was acquired by the National Property Fund of the Slovak Republic with a share of 34% and by Enel, SpA of Italy holding a majority share of 66%. From the privatisation of SE, a.s., the Gabčíkovo hydroelectric plant was excluded due to international dispute with Hungary it was caught by, although Enel still is to lease the plant on a long-term basis. Enel also did not assume operation of the V1 nuclear plant at Jaslovské Bohunice and the A1 plant currently in the process of decommission- ing. For operating the EBO V1 nuclear plant, managing nuclear facilities compliant with valid obso- lescence plans and for managing the disposal of radioactive waste and spent fuel, Jadrová vyraďovacia spoločnosť, a.s. (JAVYS, a.s.) has assumed responsibility. Slovakia is highly dependent on imports of energy commodities (Tab. 1), being actually the worst off in this regard among the V4 countries. On the other hand it is the only V4 country that managed to re- duce the share compared to 1990 levels. While in 1990, it was dependent on foreign energy to as much as 76.7%, by 2007 the share dropped to 69%. Imported primary energy sources include as in other V4 countries black coal, crude oil, natural gas and nuclear fuel. Domestic sources (including RES) comprise brown coal (mining locations in the horná Nitra region), natural gas (gas fields in the Záhorie region), hydro and geothermal power and biomass. Domestic energy production mainly is sustained by nuclear power with a significant share of solid fu- els and RES (given the high share of hydroelectric plants). Energy intensity of the national economy runs relatively high compared to EU average albeit it is low on CO2 emissions credit to the significant nuclear share in the energy mix. [19] the Slovak energy sector structure is evenly diversified in terms of the fuels used, with natural gas, nuclear power, solid fuels and to a lesser extent oil constituting a majority of primary energy supplies. In 2007, total installed output in SR amounted to 7,508 MW, with total electricity consumption at 29,632 GWh and total electricity production at 27,907 GWh. Overall from renewable sources, 4,933 GWh electricity were produced at a share of 16.6% in total consumption. The share includes hy- droelectric plants with above 10 MWh outputs. However, on excluding large hydroelectric plants from the equation, the share of RES drops to only about 1%. Consequently, electricity production from RES in Slovakia is largely shaped by the output of large hydroelectric plants. By now neither solar nor geother- mal energy have been used in Slovakia for electricity production purposes (geothermal energy rather finds use for heat production). From wind power, 8 GWh, from biogas 11 GWh and from biomass 463 GWh of electricity were produced. For the largest amount of electricity from RES, hydro power ac- counts at 4,451 GWh. In 2008, Slovakia’s total installed output reached 7,508 MW, with total electricity consumption at 29,830 GWh and total electricity production at 29,309 GWh. Overall from renewable sources, 4,933 GWh electricity were produced in a share of 16.6% in total consumption.
Fig. 5 Installed capacity of power stations in SR 1988 – 2008 Credit: SEPS, a. s.
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In terms of electricity production, Slovakia remained by 2007 a net exporter. As part of the EU acces- sion process, Slovakia committed itself to shut down two reactor units of the Jaslovské Bohunice power plant, with the country thus losing its exporter status and becoming the current net importer which is unacceptable in the long-term perspective. The unit shutdowns as opposed to safety, technical or eco- nomic concerns were brought about solely by international commitments. Among the consequences have been a growth in high voltage power prices and issues with reserve power for the grid. The largest national power project has been the completion of units 3 and 4 of the Mochovce power plant, with related investments estimated at 2.8 billion euros and the project implementation assigned to Slovenské elektrárne, a.s. (after privatisation in 2006 in majority ownership of ENEL of Italy). The ex- pected date of the plant connection to the grid is spring 2013. This is a major project due to reestablish Slovak independence in electricity supplies. Strategic papers of SR also mention the installation of a fur- ther nuclear plant under the auspices of the state as represented by JAVYS in partnership with ČEZ, the Czech national utility giant. The plant is to make use of the existing infrastructure of the current nuclear plant at Jaslovské Bohunice. The expected plant completion date is 2020. RES also are expected to contribute their share in replacing the lost facilities, although to a lesser ex- tent than the nuclear plants mentioned. As in Hungary, in Slovakia also projections have been compiled with action schemes for the different areas of the energy sector. For electricity consumption in Slovakia, 3 scenarios exist. Mean growth in electricity consumption by 2030 is expected at a level of 0.8 to 2.3% annually. Under the reference sce- nario with a mean growth rate of 1.6 % against 2007, the total growth is by 13.5 TWh, or a nearly 46% rise against current electricity consumption. In 2013, total electricity consumption under the reference scenario is to reach 33.7 TWh, with a further growth to 36.3 TWh by 2018.
Tab. 6: Projection for new power sources in SR by 2030 [34] Year 2010 2013 2015 2020 2025 2030
Nuclear plants MW 164 1106 1106 1106 2306 2306 Thermal plants/ MW 142 204 412 1132 1612 1642 Co-generation facilities Renewable sources MW 263 566 700 1000 1400 2100 Ipeľ transfer type hy- MW 600 600 600 droelectric plant Total MW 569 1876 2218 3838 5918 6648
For the Slovak energy sector, there are the following key areas of vital future importance: - Maintain the current balanced structure of production facilities (nuclear/thermal power plants, RES including hydroelectric plants); - Installation of new facilities, replacement with domestic sources (securing by 2030 the in- stallation of approx. 6 600 MW in new power facilities worth around 29 TWh of output); - Increase the capacity for cross-border power exchanges (with related capacity improve- ments and installations of transmission lines including optimisation in system regulation); - Address the topic of energy savings; - Address the topic of financing; - Address the topic of more effective coal processing (referring to the example of Poland).
2 POWER SYSTEM INFRASTRUCTURE The V4 counties interconnected as of 1992 their transmission system into the CENTREL, which on its part is integrated into the pan-European ENTSO-E (formerly UCTE) system. The interconnection aims mainly include quality improvements in technical and operative characteristics of the power grid.
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The transmission grid mainly consists of 220 kV lines (thereof 962 km in SR) and 400 kV lines (thereof 1753 km in SR) (Fig. 6). The organisation established by the European transmission system operators, ETSO (Association of the European Transmission System Operators), is coordinating the economic and regulatory cooperation of the Transmission System Operators (TSOs) in order to facilitate the operation of European integrated internal electricity market. It has 36 members from the European Union (except Malta) as well as Nor- way and Switzerland. Its associated members are the TSOs of Bosnia and Herzegovina, Croatia, Mace- donia and Serbia. The largest among them is UCTE that integrates 29 member TSOs from 24 European countries. The Polish, Czech, Slovak and Hungarian systems joined UCTE in 1995 within the framework of CENTREL cooperation. Accomplishing its mission, CENTREL as a formal association was termi- nated on 31st December 2006.
Fig. 6: Power system in Central Europe (credit: SEPS, a. s., Slovakia)
The power infrastructure also includes oil and gas pipelines for oil and gas transport from Russia and the countries of the former Soviet Union (Fig. 7).
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Fig. 7: Map of oil and gas pipelines from Russia (credit: U.S. Energy Information Administration)
3 RES PROMOTION One of the core points of the EU energy policy that has found its way also in strategic papers of the different member states has been the promotion of renewable energy sources. At the European level, the climate and energy package published by the European Commission in January 2008 (also known as the 20-20-20 package) needs mention the aim of which is to reduce by 2020 greenhouse gas emissions by 20%, reach 20% savings on energy and effectively promote renew- able energy sources to reach a 20% share in consumption. Also by means of the package, the European Union has set new targets for member states in the use of renewable energy sources (RES). The different countries committed themselves to variously ambitious targets in terms of share of re- newable energy sources in the energy mix.
Tab. 7: Share of RES for the V4 countries in 2005, 2006 respectively, and the 2020 targets [1] Share of RES in Share of RES in Target share of Country final consumption final consumption RES in final con- of energies in 2005 of energies in 2006 sumption by 2020 Czech Republic 6.1 6.4 13 Hungary 4.3 5.1 13 Poland 7.2 7.5 15 Slovakia 6.5 6.8 14
Different countries practice different approaches to RES promotion with the aim to motivate investors into installing new power facilities. The differences mainly are due to different geographic conditions of the countries, current political and economic strategies and different reference assumptions as regards not only RES but also the energy sector as a whole including transmission capacities.
3.1 RES Promotion in the Czech Republic The nation’s largest source of electricity from RES are hydroelectric plants with a total installed output of approx. 750 MW, thereof around 250 MW in small hydroelectric plants. In electricity pro-
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duction from RES, energy from biomass has been playing a notable role. The source accounts for 27% of total electricity production from RES mostly in form of solid biomass. Wind power also has been gradually growing in importance in electricity production from RES. Biomass usage in particular is likely to increase as a result of the new legislation. The promotion of biofuels is sustained by the act on air protection (from 2002) that imposes minimum amounts of biofuels and similar fuels produced from RES. Gross electricity consumption from renewable sources participated in gross domestic electricity consumption to 5.2% in 2008. The national indicative target for the share has been set to 8% by 2010 for the Czech Republic. Gross electricity consumption from renewable sources amounted to 4.5% of total gross domestic electricity production. [27] As at 19th January 2010, the Czech Energy Regulatory Office registered based on valid licences for electricity production from photovoltaic sources an aggregate installed output of photovoltaic panels of 470 MW. This means that since the end of 2008, more than 400 MW of new output have been added in this type of installations. According to scenario projections, solar installations are expected to reach at least 1000 MW installed output by the end of 2010. [38] Currently (status 31/12/2009), wind power and photovoltaic plants with more than 600 MW com- bined output are connected to the Czech power grid and there are already 3500 MW of additional out- put in authorised applications for new installations of both types of sources throughout the country. [39]
Fig. 8 Installed capacity of wind power plants in the Czech Republic [Czech RE Agency, http://www.czrea.org/cs/druhy-oze/vetrna-energie]
3.2 RES Promotion in Hungary The role of renewable energy sources in the country has increased compared to previous period. In 2008, the share of renewables and communal waste in total energy consumption (1,120 PJ) reached 5.8%. The share of electricity from renewable sources grew to 5.2% for Hungary, exceeding the 3.6% EU commitment by 2010. Target figure for the share of energy from RES in final consumption by 2020 for Hungary is 13%. As for the use of RES, their inclusion in the energy mix shall help promote the competitiveness of the national economy in view of the options available to the country and financial viability aspects [21, 22]. This combines with efforts at complying with the target set by the European Union of 13% RES share in total energy consumption by 2020 (Fig. 9). Geographic conditions of Hungary are highly favourable for electricity production from RES. As the most promising, the potential appears for biomass growing. Between 1997 and 2004, mean annual growth in biomass use reached 116%. Hydropower largely is inapplicable due to lack of adequate hy- drological conditions. The use of other RES sources such as solar energy, geothermal energy and wind
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power is obstructed by bureaucratic authorisation procedures of various levels of complexity. Even despite this, the government has been keen on promoting RES with subsidies. Particularly promising has been the potential for wind power. RES promotion takes form of feed-in tariffs with a 15-year war- ranty period. The producers are issued green certificates. There has been an increase in power from RES by 30% (to 2,270 GWh) mainly credit to higher output of large biomass/mixed fuel co-generation plants (e.g. the Mátra power plant). As of 1st January 2008, there is a new recognised category of mixed fuel (waste/fossil fuels or renewables/fossil fuels combined) from which 70 GWh were generated (thereof 62 GWh from waste). The amount of co- generated electricity subject to mandatory purchases increased by 24% (822 GWh). 46% of the growth figure has been attributable to facilities with a total capacity of 107 MW, thereof 95 MW the Debrecen combined cycle power plant with the rest split among 4 gas engine units with below 20 MW output each. [21]
6,00
5,2 5,00 4,5
3,9 4,00 3,7
% 3,00 2,3
2,00
0,8 1,00
0,00 2003 2004 2005 2006 2007 2008
Fig. 9 The share of electricity from RES in Hungary (in %) [21]
3.3 RES Promotion in Poland The country’s energy concept still relies mainly on fossil fuels with RES integration into the national economy progressing at a fairly slow pace albeit there are strong pressures on part of investors keen on exploiting the nation’s wind power and solar energy potential. The investors have been enjoying tax in- centives and distribution companies are legally obliged to purchase a predefined amount of electricity produced from RES. The producers also are issued tradeable certificates of origin. Distribution companies are obliged to make sure that predefined amounts of “green power“ from re- newable energy sources are purchased as testified with green certificates of origin as well as specific amounts of “red power“ from combined heat and electricity production.
3.4 RES Promotion in Slovakia According to the strategy paper for higher utilisation of RES, technically utilisable potential of renew- able energy sources in Slovakia is estimated at 202,900 TJ annually [2]. The potential is exploitable by making use of current technologies subject to legislative, administrative and environmental restrictions. As the source with the highest potential, biomass is considered followed by solar energy, geothermal energy, large and small hydroelectric plants and wind power. Under the national strategy for the utilisation of renewable energy sources, a large untapped potential has been identified particularly in biomass from forestry and agriculture along with the idle potential of solar energy (for water heating and electricity production purposes). Also largely unexplored is the po- tential of other types of RES such as wind power, geothermal energy and small hydroelectric plants al- though here the progress has been hindered by legislative barriers.
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There still remains a substantial potential of future usability for energy purposes as the options to- tal more than 80% of technically utilisable renewable energy sources. On full exploitation of the poten- tial, imports of energy commodities could be cut down massively, thus significantly reducing Slovakia’s dependency on foreign energy. The most promising renewable energy source for heat generation is biomass the annual utilisable potential of which for energy purposes amounts to approx. 75.6 PJ. Biomass also is a viable source for electricity production. However, as held by the Ministry of Economy, hydropower remains in the lead as the most used renewable power source. The use of wind power, geothermal energy and solar energy should only have a complementary function due to related concerns about the security and reliability of electricity and heat supplies and with the price of energy from renewable sources still remaining a factor. In 2009, RES were given a green light in the form of act on renewable energy sources. The Euro- pean Union previously had been repeatedly criticising the shortcomings of the Slovak legislation in the area of RES. The new act among other aims shall help enact compliance with the target imposed by the EU of 14% share of RES in final consumption by 2020. The level of targets set could help Slovakia in the opinion of the Commission to save 600 million euros worth of oil and gas imports annually. This is an ambitious yet realistic target. The measures part of the climate and energy package entail far- reaching implications for Slovakia be it at the level of the national budget, the industry or consumers. The measures needed in order to comply with the RES target entail an investment need of some 3.65 to 4.98 billion euros. Similar to neighbouring countries, the act on RES warrants on-grid prices of elec- tricity from RES over a period of 15 years is making the financing of the projects a significantly easier effort. The highest on-grid prices are for electricity from photovoltaic cells (up to seven times higher against fair market prices). The on-grid prices have been set to facilitate returns on investments within 8 to 10 years. The EU structural funds may also contribute to a growth in the use of RES [24]. The funds allow financing projects aimed at e.g. reducing greenhouse gas emissions, changes in the structure of fuels used towards fuels with lower carbon content and at the promotion of renewable energy sources.
Tab. 8 Total and technical potential of renewable sources [25] Total Potential Technical Potential Source (TJ) (GWh) (TJ) (GWh) Hydro power 23,760 6,600 23,760 6,600 Large hydroelectric plants 20,160 5,600 20,160 5,600 Small hydroelectric plants 3,600 1,000 3,600 1,000 Biomass 120,300 33,400 120,300 33,400 Forest biomass 16,900 4,700 16,900 4,700 Agricultural biomass 28,600 7,950 28,600 7,950 Biofuels 7,000 1,950 7,000 1,950 Biogas 6,900 1,900 6,900 1,900 Other biomass 60,900 16,900 60,900 16,900 Wind power – – 2,160 600 Geothermal energy 174,640 48,500 22,680 6,300 Solar energy 194,537,000 54,038,000 34,000 9,450 TOTAL 194,855,700 54,126,000 202,900 56,350
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CONCLUSION The key issues in the energy sector over the next 5 to 10 years comprise a solution to energy security, diversification in energy sources, use of alternative energy sources and energy savings. In reference to the aims pursued by the European Union including regulations and commitments concerning the envi- ronment (Directive of the European Parliament and of the Council 2009/28/EC on the promotion of the use of energy from renewable sources and amending and subsequently repealing Directives 2000/77/EC and 2003/30/EC) and in view of the vital interests of the different countries, the following strategic aims and priorities need to be implemented: A consistent energy strategy; New technologies in energy conversion, transport and storage; Rebuilding the energy sector on economic and environmental principles; Microregional systems of renewable energy sources; Rationalisation in consumption, intelligent grids; Power grid reliability and security; Central and regional energy systems.
A tradition in cooperation and a shared history are a good starting point for the V4 countries to suc- cessfully cooperate in the energy sector and beyond. The energy mix in the future will be primarily shaped by the availability and prices of primary energy sources, by access to the sources and by the level to which a sound diversification of the sources will be practiced. However, coal and nuclear fuels will presumably retain their status as core sources in the energy mix of the V4 countries, with a gradual pro- spective growth in the share of renewable energy sources. In the V4 countries, European Union interests meet with those of the Russian Federation, for several reasons. On part of Russia, apart from technical and political reasons there is also the historical context. Yet for a healthy development of the power industry, securing a varied ownership structure of energy assets including transparency in both actual ownership and potential owners is a vital necessity. Another aspect to consider is the regional dependency on a single energy supplier given the historical context. Ownership structure of energy companies should enable independent growth of the enterprises and pro- vide for varied options in energy supplies and the general energy security. The fact also should be put into the European perspective, as the EU energy security is the compound result of energy security of its member states.
ACKNOWLEDGEMENTS The Slovak Research and Development Agency supported this work under contract APVV-0337-07 as well as the grant VEGA 1/0687/09, Power Quality and Reliability of Power Supplies.
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