In this last of a two-part series, EnergyTag discusses its mission to accelerate the clean energy transition through 24/7 energy tracking. The industry-led initiative is aiming to define and build a market for hourly energy certificates by creating a price signal, updating outdated carbon accounting standards, and advocating for the scaling of innovative clean technologies.
Creating a price signal
Europe continues to battle a protracted energy crisis months after Russia’s invasion of Ukraine, and reliance on fossil fuels remains high. Since the launch of the Russian invasion of Ukraine, the EU has spent more than $105 billion euros on fossil fuel imports from Russia, resulting in record-high natural gas prices and skyrocketing utility bills.
“We need to be really clear about one thing about the electricity price crisis in Europe,” Daly said. “I’m living in Brussels, and our energy crisis is caused by fossil gas. That’s why electricity prices have skyrocketed in the past number of months in Europe. It has nothing to do with renewables or clean energy–it’s about gas. The way we deal with the energy crisis in Europe is by getting gas off the margin.”
That would require the buildout of more clean energy and battery storage projects to address periods of low wind and solar penetration. Right now, those gaps are being filled by gas, which is not addressed by annual matching. This results in periods of high gas penetration on the grid, while allowing consumers to claim that they are 100 percent renewable using certificates produced six months ago in another country.
“It kind of hides the gas problem,” Daly said.
Due to the inherent intermittency of renewables and geographical constraints, hybrid models and innovative renewables and storage technologies will be key to meet the load profiles of 100 percent 24/7 CFE, according to Boston University’s Institute for Global Sustainability. The report cites lithium-ion battery storage, nuclear, geothermal, and hydro as examples of complementary renewable technologies that can be added to the mix.
“Obviously, for a consumer to be 24/7 clean energy tomorrow is basically impossible in most places,” Daly said. “We don’t have the technologies at scale yet in most parts of the world. Google and Microsoft have targets for 2030. These are companies with teams thinking about this and a massive number of resources, and they’re still going to take eight years. So, if you’re an SME, no one is going to say tomorrow morning that you have to be 100 percent 24/7. But at least acknowledge the journey that we’re on and try to find out where you are today, and maybe in 2030 you can be at 70 or 80 percent.”
It’s about creating a price signal for the technologies needed to fully decarbonize, says Daly. This could translate into higher costs in the early days for 100 percent CFE investments in batteries, geothermal, and other clean-firm technologies that have not yet scaled.
“That’s the point,” Daly said. “We need to get the cost curves of these technologies down like we’ve done with wind and sun over the past 15 years. Now they’re super cheap sources of energy and they’re available. Let’s do the same thing for storage and for other clean, firm technologies. And that will make it more accessible for SMEs to get involved once we start to drive the costs down. And if certain companies for their sustainability goals are willing to pay a premium for certain technologies, then I commend them for doing that.”
What’s next for EnergyTag?
EnergyTag’s GC Standards and Guidelines continue to evolve, with some key remaining issues slated to be addressed in the next iteration of these frameworks.
This includes the development of EnergyTag’s position on temporal GHG calculations; contribution to facilitating availability of (sub) hourly average, residual and marginal emissions data; and the finalization of the energy storage Standard and Guidelines, among others.
“We need to update outdated carbon accounting standards to incorporate new forms of hourly instruments to facilitate hourly carbon accounting,” Daly said. “Granular certificates giving time-based information about energy sourcing should be reflected in how we do carbon accounting at companies that want to go beyond an annual carbon account, and they should do so in a standardized, harmonized way. We think that’s crucial, and we’ll definitely be feeding into that process, along with many other stakeholders.”
GCs for energy storage will also be addressed.
“That’s one of the major use cases,” Daly said. “On monthly certificates with no time stamping, there is no value signal for storage as the certificate can be transferred in time on the registry without having to store the energy in the real world.”
Renewable hydrogen is another major use case, particularly with the European Commission’s target of 20 million tons of renewable hydrogen by 2030, which is slated to replace natural gas, coal and oil in hard-to-decarbonize industries and transport sectors.
“Simply put, if you’re not using clean electricity to produce hydrogen, you’re not producing clean hydrogen. For example, if you’re using natural gas to produce the electricity–it’s two times worse than using gray hydrogen,” Daly said. “It’s a powerful example of why we need hourly tracking because we might end up building out whole industries that don’t give us the emissions outcomes we had hoped for. We are building and defining a market for GCs, so all of our activities are about that. I think that’s part of the power of the movement. We’re focusing on a specific area–we need to get these systems working. We’ve had a very good start but there’s a lot more to do.”