What Is Sector Coupling?

Definition

Sector coupling has become kind of a buzzword in European energy businesses. Most commonly, it means replacing the traditional separation of the energy sectors of electricity, heating and cooling, transport and industrial consumption processes in favor of a holistic approach.

Sector coupling aims at decarbonizing the national economy by converting the energy supply as completely as possible to electricity, finally reaching an "All Electric Society". A prerequisite for this is the use of the complete flexibility potential of producers and consumers as well as the storage of energy in its various forms.

In the first two decades of the 21st century, renewable energies have shown that they are able to cover an ever-larger share of the world’s electricity needs. It has therefore already been possible to decarbonize a considerable proportion of the electricity supply. The current main problem of sector coupling is to extend this success to the energy- and emission-intensive sectors of transport, heat supply, agriculture, and heavy industry. The most important economic goal from the perspective of climate protection is therefore to repeat the success of renewable energies in the electricity market by coupling all sectors of the economy that generate, consume and store energy. This sector coupling, primarily based on renewably generated electricity, should be able to make net zero CO2 emissions achievable.

The Energy System of the Future Is Electricity-based

Sector coupling says goodbye to the energy industry as a separate field of economic research and instead focuses on the entire economy as a flexible interplay of processes of electricity generation, consumption and storage with the aim of climate neutrality. However, this goal can only be achieved if all the required energy is generated from renewable energy sources. The previous primary energy sources of oil, coal and gas must therefore be replaced not only in the current electricity system, but also in all other consumption processes - i.e. in transport, heat generation, agriculture, heavy industry, and other sectors.

While great progress has been made in the electricity grid, electricity-based industrial processes, refrigeration and air conditioning as well as the transport and heat generation sectors still very much depend on oil and gas as primary energy sources. Power-to-X technologies such as power-to-gas (PtG) for the generation of hydrogen from renewable energies or power-to-heat (PtH) for the generation of heat from renewable energies already exist, but most of them are still in the experimental stage or not yet active on a large scale - although there are committed pioneers in the PtG sector.

Paradox: Electricity Storage and Flexibility Are Both Prerequisites and Results of Sector Coupling

Compared to liquid or gaseous fuels, electricity has the disadvantage that it cannot be stored easily in a container without losses. Electric energy must therefore be stored electrochemically in batteries or in converted form, for example as hydrogen gas in PtG processes, in pumped storage or in torque storage. Energy losses accompany all of these storage or conversion options.

Batteries in particular are very expensive and are by no means uncontroversial in terms of construction and consumption of raw materials; power-to-x solutions must compete on the market with fossil fuels that are still very cheap to operate.

Intelligent Use of Flexibility Can Reduce Storage Requirements

There is potential for flexibility in sector coupling at various points: For example, a fleet of electric industrial trucks can supply balancing energy, fleets of electric vehicles can charge flexibly and cost-optimized, cold storage rooms can cool in a cost-optimized manner by exploiting the inertia of thermal processes, and much more. Especially in medium-sized companies, there is a large number of flexible potentials, which await discovery.

Sector Coupling in Transport and Logistics

In the transport sector, sector coupling has progressed at different rates in different areas. There is still a need of intense research in air, water and heavy truck transport. The main problem circles around the fact that energy must be stored and transported in the vehicle in order to maintain individual mobility. Overhead-wired means of transport such as railways are currently unable to provide sufficient mobility, especially in sparsely populated regions.

In order to get the electricity onto the road in the sense of sector coupling, many vehicle manufacturers are therefore focusing on battery concepts. Around the globe, hundred thousands of engineers are involved in global research projects to increase battery capacities and ranges while reducing costs. The countless accumulators connected to the power grid during charging hours open up a giant potential for flexibility, known as Vehicle-to-Grid (V2G). For example, during low wind and overcast, vehicle batteries could compensate for minor imbalances in the power grid due to the lack of feed-in from wind and photovoltaics by providing positive control energy.

In addition to battery concepts, hydrogen is also discussed increasingly as a fuel source. For usage in motor vehicles, the storage options are comparatively simpler and cheaper. Problems lie mainly in the production of hydrogen, especially with regard to high-volume production using renewable energies. Hydrogen-based propulsion technologies (converted piston or Wankel engines, turbines or fuel cells) are also highly improvable in terms of efficiency. In Japan particularly, however, large car manufacturers are increasingly relying on hydrogen-based engines. In Germany, mainly commercial vehicle manufacturers are concentrating on hydrogen as fuel: Hydrogen from PtG systems could be refueled along the motorways during the prescribed idle periods of truck drivers. In the logistics sector, electric solutions for local deliveries are already gaining ground, partly due to the logistics companies' own vehicle developments, and local authorities are also turning to electric buses and taxis with electric engines.

But how will it be possible to power container ships, intercontinental aircraft and heavy trucks using electricity from renewable energies? At least for aviation, batteries are not a real alternative, as this example from an aviation industry portal shows. If an Airbus A320 Neo would be equipped with charged lithium-ion batteries to the total weight of its full kerosene tanks, it could only stay in the air for about 20 minutes. The plane could manage barely to fly straight and level, take-offs or safe landings would not be possible due to the lack of power. For the full flight time of about seven hours, the plane would have to carry 260 tons of lithium-ion batteries. This sums up to about three and a half times the maximum take-off weight of the Airbus A320 of 70 tons, not counting the aircraft itself.

Summary sector coupling in traffic: The process of rethinking, which has a 30-year lead in electricity generation, is still in its infancy in the transport sector. The first steps have been taken, but appropriate solutions still need to be found for the major challenges.

Sector Coupling in Heat Generation

In terms of sector coupling, heat generation has a decisive advantage over the transport sector: Heat is generated stationary in buildings and is not dependent on a transportable fuel supply. Many different technologies are well established in this sector, especially regarding combined heat and power generation (CHP). Whenever a machine generates electricity or kinetic energy, waste heat is generated through combustion, friction, chemical reactions, etc. Creating an intelligent use for this heat is the basis of the principle and success of combined heat and power (CHP) units, which belong to the strategic core of sector coupling concepts when operated with renewably produced hydrogen, biomethane or wood pellets.

The use of natural heat in the form of air heat pumps or geothermal heat pumps is now standard in many new buildings in Europe and appropriate retrofitting in older buildings can significantly improve the CO2 emissions of heating systems. The use of district heating from industrial processes or data centers, which has been known and practiced for a long time, is a concept worthwhile in the sense of sector coupling, provided that transport losses can be kept within reasonable limits. Electric heating, disguised as a cost and energy guzzler in the form of night storage heaters, is also on the verge of a comeback: modern infrared panel heating systems turn green electricity into eco-heat at a reasonable cost.

In villages or farms, local heating networks based on larger biogas plants gain importance. The generated heat is climate-neutral; the transport has low losses due to the short distances. Many oil-fired heating systems and liquefied gas ovens can thus be replaced in a climate-friendly manner.

Conclusion for sector coupling in heat generation: In contrast to the transport sector, various and already proven technologies are available to move heat generation to non-fossil methods. The challenge now lies in the widespread implementation of the climate-neutral heating technologies.

Efficiency Measures and Reduction of Overall Energy Consumption

However, the most pressing problem in the heating sector is not generation, but storage and thermal insulation. Although there have been several waves of subsidies for energy-related refurbishment in Germany in the past, households still account for 36 percent of CO2 emissions. The quality of the insulation measures that were carried out also varied greatly.

Massive investments are therefore important not only in heat generation, but also in the development of high quality and sustainable thermal insulation systems. Power-to-heat concepts could then also be implemented in perfectly insulated apartments. Connected to a Virtual Power Plant, for example, electric infrared heating systems could supply heating energy to the room exactly when cheap electricity is available and stop the heat supply when the prices increase again.

New Technologies Reduce Overall Energy Consumption - Theoretically

Thanks to new technologies in households, significantly more energy-saving alternatives have become established in recent years. Especially LED lighting compared to conventional light bulbs makes a huge difference. In traffic, e-bikes and e-scooters replaced many mopeds and scooters. If the weather is good, they are also replacing a steadily growing proportion of short-distance car traffic.

In IT, engineers have trimmed systems for greater efficiency for years; laptops, for example, consume significantly less power (around 60 watts) than desktop systems (around 130 watts, as of 2020). The shift in internet use to mobile devices also plays a role. In the field of consumer electronics, LED technology is the primary energy source in televisions and projectors today. Nearly all cathode ray tube (CRT) or plasma screens with high power consumption have been replaced in European homes.

All these technologies should actually contribute to a reduction in household electricity consumption – but the effect is small to non-existent. One reason for this is the need for growth that underlies our economic system: Consumers shift from operating not only one power-hungry device but countless small devices around the house. Ten LED lamps of seven watts each consume 70 watts per hour, too. Every there is not only one but a second, third and fourth screen that must be charged or operated on a power supply unit. In companies, however, whose lighting systems have to be much more efficient, there is a great energy saving potential in converting from halogen or neon lighting to LEDs.

Conclusion: Where Do We Stand in Sector Coupling?

Renewable energies have shown and proven that they can supply electricity in a clean and safe way. Nevertheless, apart from electricity generation, there is much left to do. The conditions for the energy transitionare sometimes more (as in heat generation and industry) and sometimes less (as in transport) favorable. If all energy consumers in the economic system turn to electricity from renewable energy sources, the electricity grid will have to meet enormous demands. The grid operators can deal with this challenge effectively through an intelligent and flexible use of networked electricity producers, consumers and storage facilities.