Without new sources of flexibility, power bills and emissions will be higher than necessary in the medium and long-term, according to a new report by Bloomberg New Energy Finance (BNEF).
It models a number of scenarios and combinations of generation and flexible technologies, including battery storage, demand-side response and smart charged electric vehicles.
Across all scenarios, renewables deliver around 75% of the generation mix by 2030 and 80% by 2040.
However, without new sources of flexibility starting to come on stream relatively quickly, policy and market makers risk locking in higher emissions and costs, according to the report, which was co-sponsored by Eaton and Statkraft.
“A lack of ‘new’ flexibility would have a real cost; the low-flex scenario is the least desirable across all metrics,” the report states. That outcome would lead to greater reliance on gas peakers, which it says will cause higher system costs and emissions, the latter 36% higher in 2040 than BNEF’s base case.
Meanwhile, high penetration of EVs that can be flexibly charged will enable the power system to absorb slightly more renewable generation and reduce the need for fossil back-up power by 7%, the report suggests.
However, it states that the ability to shift demand could perhaps deliver the biggest long run impacts.
“The ability to shift or curtail greater portions of demand allows the energy system to operate with 10% less fossil capacity, 42% less battery capacity and 5% lower system costs in 2040, reflecting the importance of flexible demand in a high-renewable energy system,” says BNEF, though it adds “these impacts are not felt until after 2030”.
Download the report here.