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Renewable Energy in Industrial Applications – an ... - Unido

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RENEWABLE ENERGY IN INDUSTRIAL APPLICATIONS<br />

Interest<strong>in</strong>g potential lies <strong>in</strong> the development of<br />

bio-based vehicle tyres <strong>an</strong>d their subsequent use<br />

<strong>in</strong> cement kilns at the end of their useful life.<br />

This <strong>an</strong>alysis suggests that, by 2050, biomass<br />

could constitute 22% (9 EJ/year) of f<strong>in</strong>al energy<br />

use <strong>in</strong> the chemical <strong>an</strong>d petrochemical sectors<br />

<strong>an</strong>d that alternative fuels could constitute up to<br />

30% (5 EJ/year) of f<strong>in</strong>al energy use <strong>in</strong> the cement<br />

sector.<br />

Across all <strong>in</strong>dustrial sectors, biomass has the<br />

potential to contribute 37 EJ/yr. But the<br />

achievement of this potential will depend on a<br />

well-function<strong>in</strong>g market <strong>an</strong>d on the development<br />

of new st<strong>an</strong>dards <strong>an</strong>d pre-process<strong>in</strong>g<br />

technologies. About one-third of the potential<br />

(12 EJ/yr) could be achieved through<br />

<strong>in</strong>terregionally traded susta<strong>in</strong>able biomass<br />

feedstocks.<br />

Solar thermal energy has the potential to<br />

contribute 5.6 EJ/yr to <strong>in</strong>dustry by 2050. Almost<br />

half of this is projected to be used <strong>in</strong> the food<br />

sector, with a roughly equal regional distribution<br />

between OECD countries, Ch<strong>in</strong>a <strong>an</strong>d the rest of the<br />

world, ma<strong>in</strong>ly <strong>in</strong> Lat<strong>in</strong> America (15%) <strong>an</strong>d Other<br />

Asia (13%). Costs depend heavily on radiation<br />

<strong>in</strong>tensity. They are expected to drop by more th<strong>an</strong><br />

60%, ma<strong>in</strong>ly as a result of learn<strong>in</strong>g effects, from a<br />

r<strong>an</strong>ge of USD 17 - USD 34 per gigajoule (GJ) <strong>in</strong><br />

2007 to USD 6 - USD 12/GJ <strong>in</strong> 2050.<br />

Heat pumps also have a part to play <strong>in</strong> low<br />

temperature process applications <strong>an</strong>d are<br />

estimated to contribute 4.9 EJ/year <strong>in</strong> 2050. Most<br />

(43%) of this will be concentrated <strong>in</strong> the food<br />

sector, ma<strong>in</strong>ly <strong>in</strong> OECD countries (60%), Ch<strong>in</strong>a<br />

(16%) <strong>an</strong>d the Former Soviet Union (15%). Costs<br />

for useful energy supply are projected to drop by<br />

between 30% <strong>an</strong>d 50%, due ma<strong>in</strong>ly to reduced<br />

capital costs, <strong>in</strong>creased perform<strong>an</strong>ce <strong>an</strong>d more<br />

consistent, market driven, <strong>in</strong>ternational electricity<br />

prices, from a r<strong>an</strong>ge of USD 9 - USD 35/GJ <strong>in</strong><br />

2007 to USD 6 - USD 18/GJ <strong>in</strong> 2050.<br />

The competitiveness of biofuels with fossil fuels<br />

is strongly dependent on national energy policy<br />

frameworks <strong>an</strong>d energy prices. In the last<br />

decade, the ratio between the highest <strong>an</strong>d lowest<br />

end-use prices for natural gas for <strong>in</strong>dustry <strong>in</strong><br />

different countries has at times been as high as<br />

60. At the end of 2009, the ratio stood at 10.<br />

For coal, the ratio between different countries<br />

has been as high as 30 <strong>an</strong>d, at the end of 2009,<br />

stood at 15 (Annex 5).<br />

<strong>Renewable</strong>s are not cost competitive where fossil<br />

fuels are subsidised. They are, however, already<br />

cost competitive <strong>in</strong> m<strong>an</strong>y cases <strong>an</strong>d m<strong>an</strong>y<br />

countries with unsubsidised fossil fuels. This is<br />

even more so where CO2 emissions carry a<br />

f<strong>in</strong><strong>an</strong>cial penalty that reflects their long-term<br />

economic <strong>an</strong>d environmental impact. Where<br />

national energy policies subsidise fossil fuels,<br />

they strongly affect the competitiveness of<br />

renewable energy.<br />

Overall, <strong>an</strong> <strong>in</strong>crease <strong>in</strong> renewable energy <strong>in</strong><br />

<strong>in</strong>dustry has the potential to contribute about<br />

10% of all expected GHG emissions reductions <strong>in</strong><br />

2050. At nearly 2 gigatonnes (Gt) of CO2, this<br />

represents 25% of the total expected emission<br />

reductions of the <strong>in</strong>dustry sector. This is<br />

equivalent to the total current CO2 emissions of<br />

Fr<strong>an</strong>ce, Germ<strong>an</strong>y, Italy <strong>an</strong>d Spa<strong>in</strong>, or around onethird<br />

of current emissions <strong>in</strong> the United States.<br />

This potential c<strong>an</strong> only be realised, however, if<br />

specific policies are developed to create a<br />

bus<strong>in</strong>ess environment conducive to private sector<br />

<strong>in</strong>vestment, particularly <strong>in</strong> the tr<strong>an</strong>sition period.<br />

Current best practice shows the conditions under<br />

which the successful deployment of renewables<br />

c<strong>an</strong> take place <strong>an</strong>d this should guide future<br />

policy mak<strong>in</strong>g. Research, development <strong>an</strong>d<br />

deployment (RD&D) <strong>an</strong>d cost reductions through<br />

economies of scale are the priorities. In the<br />

longer term, a price for GHG emissions of the<br />

order of USD 50/t CO2 is needed to support the<br />

development of a market for renewable energy<br />

technologies <strong>an</strong>d feedstocks <strong>in</strong> <strong>in</strong>dustry.<br />

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