Editorial - VGB PowerTech Journal 12/2016

The future of power industry – a view on the globe

Renewables are unstoppable …
and hydropower has a major role to play

The power industry in Europe has been changing rapidly for years now. Market liberalisation, unbundling, single market, nuclear phase-out, renewables on the rise, and de-carbonisation are just a few parameters of a challenging business environment. One can ask, whether these are the conditions that apply elsewhere in the world or whether they are a kind of preview on future transitions out of Europe. Is Europe different?

The most important global megatrends are urbanisation, shifts in economic power, demographic change, climate change, resource stress, and technological progress.

Forecasts that the global population will be about 10 billion people in 2050 mean that today’s energy demand will have at least doubled by then. This situation poses a challenge for politics, economics, and research and requires serious consideration today.

Currently cities cover just 0.5 % of the earth’s surface. However, they consume some 75 % of global resources

In 2050 half of the world’s population will live in major urban centres and there will likely be at least 40 cities with more than 10 million inhabitants. Megacities such as New York, Sao Paulo, Cairo, and Beijing will have to make billions of dollars of infrastructure investment within the next 10 years. Urban technologies to keep growing cities viable are racing ahead. An example is the emergence of ‘smart cities’ in which inhabitants can interact intelligently and efficiently with their urban environment. But despite increasing energy efficiency, the energy demands of such megacities will be enormously high.

Climate change and resource scarcity

All these will bear down to the limits of conventional energy sources in the near future. With respect to current consumption data, it appears that in just a few decades it will no longer make economic sense to harness fossil fuels. Regardless of this, existing fossil reserves will still be used extensively causing additional increase in greenhouse gas emissions, resulting in global warming. The goal declared at COP21 in Paris at the end of 2015 to limit global warming to less than 2 °C can only be achieved with extreme efforts. Integrated solutions that optimally combine renewables are already in demand today and will be even more so in the future.

Demographic and social developments

Regional differences in demographic development could not be more dramatic. In the future, the majority of the world’s population will be over 65 years old, especially in the industrialised nations. But Africa’s population will probably have doubled by 2050, while the population of Europe will shrink. By this time, individual African countries could have more inhabitants than the USA has today.

Technological breakthrough

Technological progress is an underestimated force today, but will gain more and more importance as a major driver in the reshaping of the future economy. The time it takes from invention to mass application is getting shorter. For example, it took 76 years for the telephone to reach half the population; the smartphone took only about a decade. Today the value created by internet-based technology is extraordinary. The importance of e-commerce, mobile applications and interconnectivity gets crucial even for the power industry in order to succeed in the digital age.

The role of hydropower in the future

Hydropower is the most proven and best-developed power generation technology. Increasing awareness of global warming and sustainable electricity generation, social responsibility, as well as an increasingly critical attitude toward CO2 emissions from fossil fuels, will cause increasing demand for hydropower.

Currently, approximately 16% of the world’s electric power comes from hydro. In the future, the assumption is that the enormous and increasing demand for electricity will be fulfilled by those energy concepts that best combine the various resources available. Hydropower is trend-setting here, for it does not end with power generation. Instead, it offers a wide spectrum of applications, including energy storage for grid stability and peak load coverage. Hydropower is sustainable, renewable, and flexible and has many benefits. Constant research and development will ensure that hydropower remains the most important renewable energy resource. Its technically feasible potential is an unbelievable 16,000 TWh per year. Only about 25?% of this potential is exploited as of today.

The traditional approach to the operation of hydropower facilities has to be reconsidered though. New demands are even faster response times, frequent load changes, and extended operational ranges. Anticipated future requirements include calls for frequency regulation by run-of-river power plants, mini pumped storage for balancing small wind farms, ocean energy applications combined with off-shore wind farms, small hydro to balance the impact of clouds passing over a solar plant, as well as upgrading all existing power plants to new standards and network codes, and linking them with the state-of-the-art automation systems.

For ANDRITZ HYDRO, the changing future is a big motivation to find tomorrow’s solutions today. The immense potential of hydropower can make a significant contribution to the redesigned and sustainable future energy supply system. Hydropower is and remains to be not only part, but the heart of the renewable family.