China Power System Transformation |
Power system transformation and flexibility |
Figure 9. Illustration of an interconnected energy system enabled by digitalisation
Source: IEA (2017d), Digitalization & Energy.
Pre-digital energy systems are defined by unidirectional flows and distinct roles; digital technologies enable a multi-directional and highly integrated energy system.
Rise of DER
DER are typically modular or small-scale technologies that empower end users to produce energy locally and adapt the timing of their consumption to the needs of the system. This signifies a break away from the historic top-down supply structure that has characterised electricity systems for more than a century. DER encompass a broad range of technologies, such as distributed generation and storage, and energy efficiency. In addition to wellestablished DER, such as energy efficiency, three new trends in recent years have been rooftop solar PV, EVs and – to a more limited extent – uptake of next-generation electric clean heating technologies (IEA, 2017a). In all cases, policy support has been crucial for their adoption.
Distributed solar PV
Global installed capacity of residential solar PV grew from 10.6 gigawatts (GW) in 2010 to 51 GW in 2017 (IEA, 2018c). In the same period, commercial and industrial-scale installations increased by over 72 GW to reach 98.6 GW in 2017. Growth in utility-scale projects was 215.7 GW, reaching a total capacity of 224.8 GW in 2017 (IEA, 2018c).
In 2017 the residential and commercial segments combined represented 40% of total installed solar capacity in the United States and 72% in Germany. In 2016 the share of households fitted with rooftop PV was 16% across all of Australia, standing at 26% in South Australia and 25% in Queensland. The share of households with rooftop solar PV systems was 15% in Hawaii, 7% in
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China Power System Transformation |
Power system transformation and flexibility |
Belgium and 4% in Germany (IEA, 2016a). Global installed capacity of residential solar PV is expected to more than double in the next five years to reach 120 GW by 2023.
EVs
Global sales of new electric cars surpassed 1 million units in 2017 – a record volume.17 This reflected year-on-year growth in new electric car sales of 54% compared with 2016. Electric cars18 accounted for 39% of new car sales in Norway in 2017 – the world’s most advanced market for electric cars by market share. In Iceland and Sweden, the next two most successful markets, electric cars achieved 11.7% and 6.3% market share respectively in 2017. More than half of global sales of electric cars were in the People’s Republic of China (hereafter, “China”), where electric cars had a market share of 2.2% in 2017.
The global stock of electric cars surpassed 3 million vehicles in 2017, expanding by 57% compared with 2016. It crossed the 1 million threshold in 2015 and the 2 million mark in 2016 (IEA, 2018e). In 2017 China had the largest stock of electric cars, accounting for approximately 40% of the global total. Electric cars sold in the Chinese market were more than double the amount delivered in the United States, the second-largest electric car market globally.
Electrification of other transport modes is also developing quickly, especially two-wheelers and buses. In 2017 sales of electric buses stood at about 100 000, and sales of two-wheelers were estimated at around 30 million; for both modes, the vast majority were in China.
EV uptake is closely mirrored by the growth in charging infrastructure.19 In 2017 private chargers at residences and workplaces, estimated to number almost 3 million worldwide, were the most widely used charging installations for electric cars owned by households and fleets. Charging outlets on private property for fleets (primarily buses) numbered some 366 000 units, almost all in China (IEA, 2018e).
Electricity-based clean heating
Heat pumps, which provide space heating, water heating or both, are likely to play a key role in system transformation and cross-sector integration.20 They are among the most cost-effective options to increase the amount of space heating provided by low-carbon energy, and their environmental performance is strengthened by the growth in renewable electricity production. In countries such as Finland, residential heat pumps are already deployed in demand-response systems to augment power system flexibility (IEA, 2018d). Furthermore, heat pumps are also being increasingly used in larger-scale applications in district heating and in industry.
Globally, annual heat pump sales more than doubled from 1.8 million units in 2012 to over 4 million in 2017, with year-on-year growth of 30%; of this growth, 93% was in China (Figure 10).21 The market is dominated by air-water systems (97%), followed by ground-source heat pumps (3%), of which sales grew for the first time since 2012. Sales in China made up 72% of the total, followed by those in the European Union (14%), Japan (12%) and the United States (2%). A comparatively smaller market for exhaust air or waste-heat pump technology exists mainly in
17The discussion in this section is based on IEA (2018e).
18Electric car refers to battery electric vehicles (BEVs) and plug-in hybrid electric vehicle (PHEVs), while it excludes hybrid electric vehicles (HEVs).
19EV supply equipment refers to chargers and charging infrastructure for EVs.
20The discussion in this section is based on IEA (2018c).
21Global data are based on Building Services Research and Information Association (BSRIA) sources and cover Austria, Belgium, Finland, France, Germany, Ireland, Italy, the Netherlands, Norway, Spain, Sweden, Switzerland, Turkey, the United Kingdom, the Czech Republic, Poland, Slovenia, the United States, China and Japan. The data cover air-water, ground-source and waste-heat pumps, but not air-air heat pumps, which are covered for Europe only.
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Europe, in domestic and industrial buildings (30 000 units) (BSRIA, 2018). Global data for reversible air-air pumps used for heating were not available, even though they account for most units sold in Europe. Therefore, while the exact size of the global market is currently unknown, it is larger than shown in Figure 10.
Figure 10. Global heat pump sales by technology, 2012–17 (left) and regional shares in 2017 (right)
4.5 |
Million units |
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100% |
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4.0 |
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80% |
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3.5 |
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3.0 |
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60% |
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2.5 |
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2.0 |
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40% |
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1.5 |
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1.0 |
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20% |
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0.5 |
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0.0 |
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GSHP |
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GSHP |
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China |
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United States |
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European Union |
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Note: GSHP = ground-source heat pump.
Source: BSRIA (2018), World Renewables: Heat Pump Market.
Global head pump sales have been increasing over the past years and China is the most important market for air-water heat pumps.
In recent years heat pump deployment has been strongly supported in numerous countries (e.g. China, Japan, the United States and EU countries) through national, subnational and locallevel policies, and through building code requirements for new construction and refurbishments.
In China the replacement of coal boilers by heat pumps is mainly driven by air pollution mitigation. In a number of European countries, bans on gasor oil-fired boilers, as well as stricter energy performance requirements for new construction and refurbishments, are prompting the electrification of heating. In addition, the revised Renewable Energy Directive’s heat target for 2030 is likely to drive further heat pump deployment. Incentive schemes (capital grants, tax rebates, tax credits, etc.), building codes and special electricity tariffs for heat-pump heating are likely to reinforce this.
Implications for power systems
As power system transformation continues, distribution grids may emerge as a central component of a clean, reliable and cost-effective energy system. The following trends could combine to create such an outcome:
the large-scale adoption of DER, turning these resources into an important part of the power supply
mass enrolment of demand response, enabled by digitalisation and the effective integration of energy efficiency through intelligent end-use devices
electrification of transport, heating and industry.
However, co-ordination is required to achieve this. The possible effects of increased electrification of road transport on electricity demand, and consequently on power grids, are a
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IEA. All rights reserved