Compass Lexecon advises FGW on decarbonisation scenarios for Austria’s energy system

In a study for the Austrian Association of the Gas and Heating Industry (FGW), Compass Lexecon modelled the evolvement of the Austrian energy system, charting a transition path towards full decarbonisation from today up until 2040. The study highlights the role and cross-sectoral impacts of the transition on the use of green gases (clean hydrogen and biogas), the district heating sector and the integrated EU power sector.

Situation

The Austrian government has set the ambitious goal of Austria being climate-neutral by 2040. Against this background, the Austrian Association of the Gas and Heating Industry (FGW) commissioned Compass Lexecon to develop two scenarios for the decarbonisation of the entire Austrian energy system.

Our role

Compass Lexecon prepared a study in which we provide insights by modelling and comparing two scenarios for the development of the Austrian energy system up until 2040.

We have leveraged current Austrian sector studies for the industrial and transport sector as well as studies for generation potentials from biomass, biogas and hydrogen. We have supplemented these with modelling of the individual heating sector as well as of electricity generation, district heating and hydrogen production, among other things.

The two scenarios of (i) strong electrification and (ii) diversified use of energy carriers (including increased use of decarbonised gaseous energy carriers, such as biomethane and green hydrogen) were modelled in order to achieve climate neutrality by 2040.

A particular focus was placed on the electricity and district heating sector: we developed a cost-optimised path for the replacement and expansion of generation capacities in order to achieve complete decarbonisation by 2040 while maintaining security of supply.

The scenarios were then analysed with regard to, inter alia, the following aspects:

• Development of energy consumption (primary and final energy);
• Interactions between the electricity, gas and district heating sectors;
• Production, use and import of green gases (including hydrogen and biomethane);
• Development of CO2 emissions in Austria over time;
• Evolvement of the required flexibilities in the energy system and potential sources to provide them;
• Electricity imports and their CO2 intensity; and
• Investments in end-use technologies, electricity and district heating production capacities and the production of green gases.

Our impact

The study is the first one to chart a transition path to full decarbonisation in 2040 while modelling the Austrian energy system in fine timely granularity and embedded in the wider EU. It allows the FGW to deduct necessary evolvements of the policy and regulatory framework enabling decarbonisation and to formulate corresponding demands.

The study is available here.

The Team

The Compass Lexecon team was led by Gerald Aue from the EMEA Energy Practice based in Paris and Berlin offices, with significant contribution from Maxime Amadio.