What trends in development of "green" economy are observed in Europe today? How are issues of energy storage solved, is the interaction of different industries important in development of "green" energy? We talked about this and many other things with Assem Bakytzhan-Augustin, Project Manager of Green Energy 3000 GmbH in Kazakhstan and Poland.

Our reference: "Green Energy 3000 GmbH" - is a company with extensive international experience in development of projects in the field of renewable energy. The company also acts as a general contractor and operator of electricity parks based on renewable energy sources. Green Energy 3000 offers complete solutions for generation of solar and wind power, as well as its storage systems.

– Mrs. Bakytzhan-Augustin, tell us how active is transformation fr om the traditional model of development to the "green" economy in Europe today? What trends in the development of "green" energy are popular in the European Union?

- In Europe, no one has been discussing the topic "How important are the principles of a green economy?" fora long time. This discussion is long over. Now it is obvious to everyone that further development of the economy and adoption of business decisions must necessarily be based on the principles of sustainable development. In other words, economic growth should be linked to environmental and social goals. And this is not just a "green" political hype, this topic has long been in practice. Sustainable development has been central to European politics and economics for several years. In 2019, the European Commission adopted a very important document - "the Green Deal". This is the European Green Pact, the main objective of which is to achieve zero total environmental pollution by switching from the use of fossil fuels to renewable energy sources in the EU countries by 2050. And this is a brilliant proof of the importance of the "green" economy for the EU.

In general, Europe intends to decarbonize the economy through energy transformation based on renewable energy sources. At the same time, various forecasts and development concepts indicate that the main resources will be the sun and wind. But it is not enough just to build powerful WPP and SPP. Since they are variable generation by their nature, which leads to a number of questions and tasks. These tasks determine the current trends in the development of the sector. Trends such as electric mobility, development of autonomous regional cells and energy clusters, and the integration of short-term and long-term storage units. Let's not forget about PtX technologies, automated management systems, new measurement technologies that open up opportunities for use of high-frequency and high-precision data, protection of this data, the development of corporate PPA, allowing the development of renewable energy projects beyond the support of "virtual" stations. All of this is a search for a solution to the most important task that the growth of variable generation sources in the energomix brings - flexibility. Now we are not just talking about clean energy, but clean and affordable in geographical, economic and temporal terms and various industries.

Of course, flexibility, the ability to react quickly to a situation, has always been part of the energy supply - its technical and economic forms. With the growth of RES in the energy balance, its importance for stability of the economy has increased significantly. After all, now the issue of flexible energy management has been added to the issue of flexible production. This situation makes all players in the sector think about the existing rules. And it forces them to look for new universal approaches and concepts of interaction along the entire "producer-consumer" line.

– In development of renewable energy, Kazakhstan has followed the path of a strategy for development of large-scale renewable energy projects. However, in many countries, we see quite different processes going on today: decentralization and the development of so-called distributed generation. What was the reason for this model of renewable energy development in the European Union?

- First, I would like to say that among European countries there are also regional differences due to many factors, such as natural resources, infrastructure, its history, economy, national laws and regulations.

As for development of RES sector, the focus was not only on industrial RES, i.e. multi-megawatt power plants. In Europe, huge potential and, consequently, the contribution to the energy transformation of micro and small plants for their own consumption was very timely recognized. Appropriate conditions have been developed that encourage individual consumers, whether an individual or a legal entity, to invest in their own panels or even entire micro-power systems. To see this potential and provide the necessary conditions is also the answer to the issue of flexibility that I mentioned earlier.

It is about flexible access to clean energy in geographical and economic terms.

Building industrial wind power plants, searching for enough land for them, taking into account the environment, pulling kilometre-long transmission lines from them to the final consumer, losing a certain percentage of this energy along the way takes much funds and time. Then why not, in parallel with the development of the industrial sector of renewable energy, to provide opportunity to everyone who wants to produce their own clean energy? After all, the sunlight, thank God, is everywhere, and the wind, too, and they will never bill us!

For example, in Poland, consumers have long been producers of their own clean energy. This is true not only to individual households, but also to small and medium-sized enterprises, administrative buildings, and large industrial producers from various industries. Thanks to the pass system, i.e. wire transfer for electricity, the annual expenses of a household with an annual consumption of 4,500 kwh decreased from about 3,150 zlotys to 300 zlotys. And this is already a saving, isn't it? Thus, the cost of energy consumed from the grid is reduced, i.e., the initially high investment is returned. In addition, grids practically serve as storage unit. Since the excess energy produced in the summer and not consumed immediately can be consumed at night or in winter at a discount of 80%. At the same time, losses overlong-distance grids are reduced, since about 40% of energy is consumed by "life" households.

On the basis of such self-supporting cells existing in one local environment, energy clusters have appeared in Poland. These include local government, local SMEs, and small households. One example of such a cluster is the gmina Michalowa in Podlasie, wh ere a local system was created that could operate independently of the entire country's energy system. It consists of 2 biogas plants for cogeneration of heat and electricity in the amount of about 10,000 MWh and about 27,740 GJ., SPP 0.5 MWp, storage unit with a capacity of 600 MWh, micro-installations (for example, at a school complex, households) and local electrical and heating grids.

As we can see, the emphasis on regionality not only encourages local governments and residents, but also enables a particular region to increase its competitiveness, use the potential of local enterprises or encourage the creation of new ones. After all, as is well known, it is small and medium-sized businesses that are the main driving force of the economy.

– Do you think the development of energy storage can solve the problems with balancing and storing energy?

- Energy storage is one of several options for increasing the flexibility of energy supply. But it must be said that energy storage is not just batteries. As you know, in terms of storage technology, there is a distinction between short-term and long-term storage, depending on their application. Short-term storage facilities can receive and release energy several times during the day. Usually, they only offer a limited amount of storage. Long-term storage should be able to store electrical energy for several days or weeks. For example, to cover the phases of a long pause of the wind and when the sun barely shines. Accordingly, there are many different technologies and methods. The decision on when and which method or technology to use should first be based on the current technological structure of each national energy system. Very deep technical and extensive market research is needed. As far as I know, KEGOC is currently conducting similar studies. Based on their results, a little later it will be possible to say which storage unit is more appropriate for relevant task.

– What kind of energy storage technologies are used in Germany?

- In Germany, the most common form of storage is hydro-accumulating power plants (HAPP), which are used as large storage facilities. Today, they operate with a total capacity of about 6.5 GW and a capacity of about 40 GWh. Thus, their share in the total installed generation capacity in Germany is about 5%.

In recent years, there has also been a significant increase in large-scale battery storage systems (GBSS). The total realized and planned capacity of GBSS in 2019 was about 550 MWh. This indicator does not include small private batteries to optimize consumption fr om households' own solar panels. Although this sector of the industry is growing and developing very quickly. In parallel, the market for energy storage for industry is also actively developing.

These two types of storage cover different applications: while GBSS provide high performance with less capacity required to provide primary regulation, HAPP require more capacity compared to their performance and are therefore used more to balance fluctuations during the day or week.

As for development of battery technology, other possible functions that they can take on in the power grid are being actively discussed. Their use for primary regulation has already been established. Grid booster feature is likely to be tested in the first pilot projects. Grid booster concept provides for storing high-capacity electricity in reserve in case of an emergency: if an important grid resource of the transmission grid fails unplanned, the battery should start up within milliseconds and maintain the grid until quickly deployable generating stations are available.

The possibility of their wider use is also being discussed. For example, using private storage for local grid services. However, it is not yet clear what these services may consist of and whether they can actually be provided. In addition, it is unclear what incentives there may be for a private storage operator in this area. If financial incentives were used in this matter, they would most likely have to be very high, as they would have to compete with the economic benefits of self-consumption.

– Is there any government support for development of storage technologies?

-Yes, the state supports the development of storage technologies through various programs and research. For example, the "storage support Initiative" operating since 2012, supports a wide range of technologies, from private batteries in households and megawatt-range energy storage systems to long-term renewable energy storage projects. Special attention is paid to the wind-hydrogen compound, heat storage units and batteries in distribution grids. In 2019, the federal government allocated funds forthe latter in the amount of about nine million euros.

But other support mechanisms also contribute very well to the widespread use and development of technology and, thus, its cheapening. Eliminating numerous additional electricity costs for auto-consumption (grid charges, duties, taxes) allows investing in private electricity storage systems. A number of federal states, municipalities, and public utility companies in Germany offer direct subsidies specifically for investment in private storage systems. The amount of subsidies varies greatly, but on average about 20% of investment costs are covered by subsidies.

For example, full or extensive exemptions from grid charges are applied for HAPP. No fees are charged for total storage consumption, including storage losses.

But I would also like to draw attention to another way of flexibility of supply and demand. It is not a technological solution, but a market solution - demand management mechanism. It allows the operator to stabilize the system using the potential of the system. Differentiated tariffs are the simplest form of such management, encouraging consumers to reduce or increase their consumption when necessary.

For example, in Poland, the peak demand for electricity usually does not exceed 200 hours per year. The construction of a new power unit that provides the necessary capacity is not economically justified at this time. It is much more efficient to use services, i.e. the flexibility of energy consumers, who can voluntarily release the necessary capacity in exchange for remuneration for various forms of cooperation (readiness and actual release). According to Enel X and EnerNOC, with well-built market mechanisms, the DSR potential in Poland is 10% of the peak demand, i.e. more than 2.5 thousand MW.

Large consumers can also participate in such cooperation: factories and plant, large-format stores, shopping centers, office buildings, farms, greenhouses, cold stores, and other smaller consumers, gathering under one representative unit. For companies, participation in DSR services means not only additional earnings and increased competitiveness, but also greater control over their own electricity consumption and, thus, increased energy efficiency.

– In your opinion, how important is the interaction of different industries in development of "green" energy?

-Firstly, in order to effectively replace all fossil fuels, such as gas, coal and oil, electricity from renewable energy sources must also be used for transportation and heating. Thus, sector coupling is an important next step towards decarbonizing the economy.

Secondly, sector coupling makes it possible to use clean energy more efficiently by redirecting it to the transport and heating sectors, and thus can help regulate the system. For example, when energy from wind cannot be used or stored, power plants are usually shut down, and thus clean energy is not produced, it is lost. But if you use it with PtX technology, it increases its efficiency and limits greenhouse gas emissions.

Thirdly, it is another way to flexibility of supply and demand in the energy sector. By converting pure electrical energy into another form, we separate its production from consumption not only in time, but also geographically. Because with the help of PtG and PtL, it is possible to transport a resource to the place wh ere it may be needed.

Think, for instance of electric cars, which are charged fr om common or autonomous grid. Let's call it direct interaction. Because the car consumes electrical energy directly, and not green gas as fuel, which was produced using electricity from renewable energy sources. According to the independent statistical agency Statista, the number of new electric vehicles registered in Germany as of 1.01.2021 was about 309.1 thousand units. This figure increased by 126% compared to the previous year.

Of course, the growth of electric mobility brings with it a number of issues. How does a large number of electric cars affect the distribution grids, especially when peaks occur due to simultaneous charging? Is it necessary and how to expand distribution grids? How to increase their manageability? It is obvious that it is necessary to spread a high-quality infrastructure of fast charging stations throughout the country. This also leads to changes in existing legislation due to the growth of new technology. How to organize all these changes at the pan-European level? As you can see, there are many questions and challenges, and they are very complex and multifaceted.

Let's consider another case - interaction of industries - the production of green hydrogen. One of the most promising projects in this area in Germany is the Salzgitter Wind Hydrogen project. The project was originated in the cooperation of three companies (Salzgitter Flachstahl GmbH, Linde AG and Avacon Natur). They intend to produce hydrogen using wind power and using electrolysis. It should be used in steel production to reduce CO2 emissions. It could also be supplied into the existing gas grid.

As part of this project, the steel mill will replace three existing blast furnaces with a combination of direct reduction units and electric arc furnaces. Such a transformation of steel production could reduce CO2 emissions by about 95% by 2050. That's a nice number, isn't it? At the same time, 7 installed wind turbines with a total capacity of 30 MW will produce electricity. And 2 electrolysis plants with a capacity of 1.25 MW, will produce about 450 m3 of high-purity hydrogen per hour. Hydrogen is already used in production of annealing steel and in hot-dip galvanizing plants. Industrial gas producer Linde currently supplies gas by road, and will continue to provide continuous supplies of hydrogen in the future. The installed equipment is currently in test operation. But we can already say that the results of this project will be breakthrough.

– In your opinion, how can we activate the process of decarbonizing the economy?

- I believe that the decarbonization of the economy is not just a technological transformation, but also a transformation of the population's thinking. It is the right and duty of every resident of every small settlement and huge metropolis to know how the energy they consume is produced and what exactly they pay for at each stage. Participate in development processes of the area wh ere he/she lives. To do this, we all do not need to be engineers, environmentalists or financiers. It is enough to understand the picture and be able to ask the experts all the questions you are interested in. And therefore, it is necessary to carry out explanatory work, to bring the topic to broad discussion panels on different platforms. It is necessary to inform the population through all relevant mass media, to tell children in kindergarten and school about energy, about its direct and indirect impact on each person, on the economy of the country, region, etc.

It is necessary to clearly show at what stages and how ordinary citizens can influence the decision on whether to build a wind turbine or not. And how they affect the environment and the economy of the country in this way. High-quality awareness of the population is fundamentally important in any changes. Decarbonisation of the economy will be stable and efficient only in this way.

– Thank you for the interview!