Airbus Moves Ahead With Zero Emissions Plane: BNEF Update

(Bloomberg) -- BloombergNEF’s annual summit in London runs this week, gathering policy makers, financiers and industry executives.

Key speakers include EON SE Chief Executive Officer Johannes Teyssen, ScottishPower’s CEO Keith Anderson, Audrey Zibelman from the Australian Energy Market Operator and Glen Llewellyn, vice president of the zero emissions aircraft unit of Airbus SE.

They’re discussing the pace of the global transition toward cleaner energy, how utilities adapt to a grid relying on more renewables and the future of transportation as governments cut back on fossil-fuels.

Key Developments:

• A U.K. transport minister sees potential in hyrdogen and electric scooters
• Energy grids need investment to cope with transition to cleaner fuels
• The pandemic shows power grids can absorb more renewables than thought

Here are the latest developments, updated throughout the day. (Timestamps are for local time in London on Tuesday.)

Airbus Moving Ahead With Zero Emissions Aircraft (11:30 a.m.)

The coronavirus pandemic hasn’t hit Airbus’s ambition to develop zero emission aircraft, said Glenn Llewellyn, its vice president of zero emission aircraft.

“Even in the context of huge difficulty for Airbus and for the aviation industry, we’ve stuck with our plans for developing zero emission solutions. And Covid has definitely not taken away our appetite to be able to fulfill societal expectation,” he said.

Airbus is counting on hydrogen to be the clean fuel of choice for the aviation industry, having this year canceled the E-Fan X hybrid-electric demonstrator program.

But Llewellyn said electricity will continue to play a role in zero emission flights, albeit at a smaller scale. “Electric technology is still interesting to us,” he said.

U.K. Sees Hydrogen Potential in Transport (10:45 a.m.)

The U.K. is investing heavily in research of hydrogen technology to help cut emissions from heavy transport, like ships and aeroplanes, Transport Minister Rachel Maclean said.

Her department will publish a transport decarbonisation plan by the end of this year, which will focus on cutting emissions from freight, increasing the number of electric vehicle charge points and designing cities more efficiently to reduce pollution, she said.

“The whole area of freight is huge,” she said.

Maclean also said she sees potential for electric scooters to replace shorter car journeys. Unlike in other parts of Europe, it’s still illegal to ride e-scooters on British roads. But the government is currently undertaking some trials to see if and how they could be allowed.

“It’s certainly a very good alternative if you were going to make a very short journey by a car to use an E scooter instead. And that’s how we see it playing into the mix, because we know that we know that vast numbers of car journeys are very short” and under 5 miles.

However, research in three French cities has shown that nearly a third of e-scooter uses would have used public transport had the scooter not been available.

Buildings Need Policy Push to Cut Emissions (9:20 a.m.)

The European Union’s policies to vastly improve energy efficiency in buildings don’t necessarily go far enough, one panel concluded.

Technologies -- like heat pumps and on-site generation -- “are out there, but there is a definite lack of knowledge about them,” according to Mara Missouri Gajic, international marketing and Strategy Officer Muller Group.

The EU is looking at slashing building emissions by 60% and reducing heating and cooling demand by 18%, while France has committed 6.7 billion euros ($7.9 billion) to renovating old buildings. The key is communicating the benefits clearly to building users.

The productivity gains from improving energy efficiency are a “huge win” for companies, governments and job creation, said Jonathan Maxwell, CEO of environmental infrastructure investor SDCL.

Europe’s statement on buildings “is a policy earthquake,” he said. “It’s the best possible signal ever to send. It will require much more public and private sector capital.”

Grids Need Investment to Cope With Energy Shift (8:20 a.m.)

The energy grid needs investment to cope with cleaner forms of energy, executives from some of Europe’s largest network managers said. As more cars are run on batteries and electricity is made from intermittent renewables, power networks need to adapt to balance various loads.

“If you want to achieve net zero, you have to do it to the transmission and distribution system first,” said Keith Anderson, chief executive officer of Iberdrola SA’s ScottishPower unit. “You can’t just do it to the end points that people see touch and feel.”

Anderson sees the post-coronavirus recovery as a perfect opportunity to make large investments in transmission, which will be crucial to electrifying more energy demand and driving down carbon emissions.

The shift to renewables means the grids must adapt, said Johannes Teyssen, CEO of the German network operator EON SE.

“We need to learn how to localize our system,” Teyssen said. “We need to ask ourselves how can we mobilize and flexible local demand. We might even need some enforcement to mobilize local distributed demand.”

The plummeting demand and high penetration of renewables also re-enforced the case to put more batteries on the grid, said Belen Linares, energy business innovation director at Acciona SA.

Pandemic Showed Grids Can Absorb More Renewables (8:10 a.m.)

The energy transition largely remained on track at the height of the pandemic “and in some instances we got a picture of what the future might look like,” David Hostert, head of EMEA research at BNEF.

Despite demand for power collapsing and renewable energy flooding grids, infrastructure to transport electricity withstood the challenges. During nationwide lockdowns, there were several days that saw more than 50% of wind and solar in the system in countries including Germany, a level that would have been unthinkable just a few years ago.

“So the grid really saw a glimpse of the future, and by and large nothing broke,” Hostert said. “That was not clear from the outset.”

READ MORE: Yesterday’s recap on Big Oil’s transition, Poland and renewables becoming the cheapest source of electricity.

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