Impacts of high energy prices on long-term energy-economic scenarios for Germany

Prices of oil and other fossil fuels on global markets have reached a high level in recent years. These levels were not able to be reproduced on the basis of scenarios and prognoses that were published in the past. New scenarios, based on higher energy price trajectories, have appeared only recently. The future role of various energy carriers and technologies in energy-economic scenarios will greatly depend on the level of energy prices. Therefore, an analysis of the impact of high energy prices on long-term scenarios for Germany was undertaken. Based on a reference scenario with moderate prices, a series of consistent high price scenarios for primary and secondary energy carriers were developed. Two scenarios with (i) continuously rising price trajectories and (ii) a price shock with a price peak during the period 2010-15 and a subsequent decline to the reference level are analysed. Two types of models have been applied in the analysis. The IKARUS energy systems optimisation model covers the whole of the German energy system from primary energy supply down to the end-use sectors. Key results in both high price scenarios include a replacement of natural gas by hard coal and renewable energy sources in electricity and heat generation. Backstop technologies like coal liquefaction begin to play a role under such conditions. Up to 10% of final energy consumption is saved in the end-use sectors, with the residential and transport sector being the greatest contributors. Even without additional restrictions, CO2 emissions significantly drop in comparison to the reference scenario. The ELIAS electricity investment analysis model focuses on the power sector. In the reference scenario with current allocation rules in the emissions trading scheme, the CO2 emissions decrease relatively steadily. The development is characterised by the phaseout of nuclear energy which is counterweighted by the increase of renewable. In the high price scenario, the CO2 emissions temporarily rise around 2020 as a result of the diminishing attractiveness of electricity produced by natural gas in comparison to coal fired power plants (especially lignite). In the case of the implementation of an ideal emissions trading scheme with full auctioning of EU allowances to new entrants, the emission abatement is significantly higher in the reference scenario. In the high price scenario, emission reductions are significantly lower and are comparable to the high price scenario under current allocation rules. (au)