Sector Coupling Southern Denmark

Challenge

European countries are required to reduce their overall greenhouse gas emissions by 40% by 2030.

In Denmark, the goal is a 70% reduction compared to 1990 levels by 2030—this calls for efficient planning, including analytical models and methods that ensure a focus on value creation and synergy across different energy sectors. This includes tools like an objective and commercially viable foundation that can be used locally, regionally, and nationally to screen sector coupling potential and build bridges between the many public and private actors who are currently facing the enormous task of constructing future cost-effective energy infrastructure.

For many years, the focus has primarily been on the electricity sector and its transition to renewable energy, resulting in over 50% of the electricity now being produced from renewable sources, with challenges being evident in the transport and agriculture sectors.

In the transport sector, the rise of electric vehicles and the electrification of light transport is notable. However, electrification is not considered the most cost-effective solution when it comes to transitioning the maritime sector, heavy land transport, and aviation in the coming years. To address this challenge, there is increasing investment in Power-to-X, which serves as the link between the transport and electricity sectors. Power-to-X also connects the heating and cooling sectors.

With Power-to-X, electricity (power) can be converted into anything (X), allowing for the production of green aviation fuel, green methane for the gas grid, or green ammonia for use in maritime transport and the agricultural sector.

Solution

There are various opportunities to produce green fuels that can meet needs where direct electrification is not possible. When sectors across industries utilize energy, sector coupling occurs, and several synergies can be leveraged for the benefit of society.

Some immediate benefits of sector coupling include increased energy efficiency, reduction of CO2 equivalents, and greater flexibility in our shared energy infrastructures. Moreover, sector coupling significantly enhances the robustness and energy security of the renewable energy system. Thus, there are many advantages to sector coupling that must be explored and valued—both positive and negative externalities will be identified and their impact on the national economy assessed.

This project seeks to accelerate the development of methods and business models that are necessary for making the right investments in the future energy system, both for industry and society.

Expected Outcome/Effect

The Sector Coupling Southern Denmark project aims to develop a decision-support, analysis, and screening tool for valuing sector coupling projects based on actor screening, energy flow analysis, and barrier analysis, with a primary focus on sector coupling in Esbjerg municipality. The analysis will address investment decisions in the private and public energy sectors, investigating the balance between self-sustaining economics and the commercial private sector.

There is clear synergy between private actors seeking to build Power-to-X facilities and utilities such as DinForsyning, which must adapt the energy system to accommodate new large-scale players.

Sector coupling spans electricity, heating, cooling, transport, and agriculture within this system. The main focus of the project is to explore the synergies between these sectors and the influence sector coupling has on investment decisions.

The project will also have a broader national focus and aim to address the challenges faced by industry throughout Denmark and potentially abroad. The model will be developed so it can potentially be used in other projects, such as in Skive, Aalborg, Fredericia, and other locations.

The goal of the methods and calculation models developed in the project is to value sector coupling, both collectively in the defined project and individually for each actor involved. This valuation will be used to differentiate the value creation of various projects and provide the foundation for financial decisions as well as planning.