Heat: Understanding its Role in the Energy Transition

Let’s start answering to the question: what do we use energy for?

Electricity
Transport
Sanitary hot water, pool heating, space heating and cooling, industrial processes, etc.
All of the above

The correct answer is “4) All of the above”.

According to the Renewables 2024 Global Status Report [1] of REN21, the share of the energy carrier in each case in the global final energy supply is the following:

Electricity: 23%
Fuel for transport: 29%
Heat for sanitary hot water, space heating and cooling, industrial processes, etc: 49%

This is where the hashtag #HeatIsHalf comes from. Indeed, half of the energy that is supplied globally, is for heat!

Renewable energy sources for heat

Considering that 79% of our energy supply is fossil fuel-based [2], the next question is what share of energy comes from renewable sources in each case?

The report of REN21 also has the answer:

Electricity: 30%
Fuel for transport: 3.9%
Heat for sanitary hot water, pool heating, space heating and cooling, industrial processes, etc.: 9.9%

It gets clearer where we shall work a bit harder in order to be more effective in terms of decarbonization. Now, what renewable energy sources are included in each share?

Electricity: solar energy (photovoltaic -PV and concentrated solar thermal power – CSP), wind energy, hydropower, ocean power, bioenergy, geothermal power, nuclear power.
Fuel for transport: biofuels and, potentially, green hydrogen.
Heat for sanitary hot water, pool heating, space heating and cooling, industrial processes, etc: solar thermal energy, geothermal, biomass, biogas.

In conclusion, renewable heat energy sources are key elements of the energy transition, because “heat is half” of the global final energy consumption and we must reduce carbon emissions immediately, and not only in the electrical sector.

Our favourite renewable energy source is solar thermal. Therefore, we advocate for policies, programs and projects that accelerate the decarbonization of the heat supply with solar heating and cooling technologies.

Solar thermal facts and figures

The report Solar Heat Worldwide 2024 [3] from the International Energy Agency Solar Heating and Cooling Programme (IEA SHC) provides an overview of the general trends in the solar thermal industry and documents the installed solar thermal capacity across key global markets.

Global solar thermal capacity in 2023: 560 GW_th
Annual solar thermal energy yield: 456 TW_h
Mitigation: 158.4 million tons of CO₂
New solar thermal capacity in 2023: 21 GW_th

Markets with growth 2022/2023:

United Kingdom 66%

Mozambique 40%

India 27%

South Africa 12%

Greece 10%

Mexico 5%

Brazil 3%

Article written by Marisol Oropeza, Business and Marketing Strategist at matters and founder of Heat Changers.

Sources:

[1] REN21, Renewables 2024 Global Status Report – Energy Supply, 13, https://www.ren21.net/wp-content/uploads/2019/05/GSR2024_Supply.pdf

[2] REN21 (2024), Renewables 2024 Global Status Report – Global Overview, 16, https://www.ren21.net/wp-content/uploads/2019/05/GSR2024_Supply.pdf

[3] IEA SHC (2024), Solar Heat Worldwide 2024, 10-11, https://www.iea-shc.org/Data/Sites/1/publications/Solar-Heat-Worldwide-2024.pdf

Connecting the dots to industrial decarbonization

The good news is that industrial decarbonization is possible, and the even better news is that there is more than one way to achieve it.

We are now living three moments defining the pathways to industrial decarbonization: need, share and availability. Each of these moments deserves an analysis; however, how they converge gives us the key to tie up the dots and be able to observe the complete scenario in which industrial decarbonization is developing.

These moments respond to the motivations, the responsibility for greenhouse gas emissions and the feasibility of an energy transition in the sector. However, structuring the path to be taken is left to the context defined by public policies, regulations and access to benefits and technology. This gives us as a wide range of possibilities, where companies can make strategic, informed and practical decisions.

The following explains what these three moments are, their challenges and how to create that scenario of energy transition in the industrial sector where solar thermal energy plays a very important role in the path.

Necessity: new hopes and new rules for industry

Why decarbonize the industrial sector? In 2022, the industrial sector was responsible for a quarter of global carbon dioxide emissions. It is not without reason that, albeit slowly, more and more pressure is coming from different sides to shift industry away from fossil fuels.

However, the motivation to join targets for decarbonization can come from immediate factors that make this process a necessity:

Investors: these often have climate or decarbonization goals set out in their ESG (environmental, social and governance criteria). To accomplish these goals, they put pressure on the entities under their investment.
Public entities: they establish local, regional or international regulations, in some cases forcing the disclosure of emissions. For example, the NDCs of each country or the European Union regulations that contemplate in their goals the decarbonization of the industry.
The market: the decarbonization of the industry may also generate a boost in profits or may position companies in markets where they are not, with the benefit of staying where they already are.

These three factors feedback on each other and can strongly guide the industry’s decisions in its need to decarbonize its processes.

Share: #HeatIsHalf and the case of the energy transition

In the race towards zero emissions, it is urgent to address the problems at the source. The data come back again and again to confirm that a large part of the energy transition must be gestated from thermal energy.

The supply of electricity has a fair share of 30% from renewable sources. However, the overall need accounts for less than one third of the total final energy consumption.

"The transition is more complex than just changing the fuel, it's changing the energy system, and with changing the system, it's changing the energy supply and demand as well."

Rana Adib

Directora Ejecutiva de REN21

“The transition is not happening fast enough, the demand for energy is growing faster than the adoption of renewables. There are continued investments and subsidies for fossil fuels that prevent renewable energy from coming” says Rana in a podcast of The smarter E.

In addition to this, Rana also mentioned that another challenge is concentration. First, of technology, which continues to focus on developing more photovoltaics; and, second, geographically, leaving aside regions such as Africa, Asia – not including China, the Middle East and Latin America.

Availability: options for decarbonizing industry

Proportionally, the industrial sector has a significant impact on final energy consumption. Of that total thermal energy use, 53% is used for industrial processes, 44% in buildings to heat water and spaces, and 3% for agriculture, according to 2023 data from the International Energy Agency (IEA). In other words, proportionally, a quarter of all energy end use is purely in the hands of the industrial sector.

Specifically, in the industrial sector, the IEA believes that improvements towards decarbonization have been “modest” and “very slow,” largely due to the low development and implementation of new technologies. In the Zero Emissions scenarios for 2050, they consider technologies that have been proven to be effective but are not yet commercially available.

Here is where visibility plays a crucial role. According to the report Solar Heat Worldwide 2024 from the IEA SHC, there are at least 1,209 plants that deliver Solar Heat for Industrial Processes (SHIP) at low, medium and high temperature levels around the world.

A survey that is carried out annually, monitors the development of this market segment. The results from the 2023 survey, show that there are qualified suppliers with a remarkable track of systems installed in three continents: Asia, Europe and America.

There are multiple types of solar thermal technologies suitable for the specific needs of the factories. The survey also indicates that most of the suppliers produce the collectors in-house or assembly them on-site to deliver tailored-made clean heat solutions to clients from several industrial sectors around the world.

The thread that connects all: public policies and the market

We have already noted the proportional weight that thermal energy has in energy consumption, does this reflect in the world’s policies?

No, in REN21’s most recent report on the global status of renewables in 2024, of the 182 countries with renewable energy targets, only 43 have targets for heating and cooling. Meeting those targets will be the result of a series of guidelines and public policies that incentivize the inclusion of renewable technologies in the industry.

Public policies and the market are the context which shape the scenario for the industry to achieve its decarbonization. And in the need to move away from fossil fuels, transforming the origin of thermal energy, given its proportion, is a wise decision. The strategy lies in the ability to manage the availability of technology within the context that the market and policies provide.

Some examples of policies and regulations:

The case of CBAM in the European Union: the EU approved the Carbon Border Adjustment Mechanism, a tax in which the importer will have to declare the emissions linked to the production processes and, if they exceed the European standard, will have to purchase an “emissions certificate” with the EU CO2 price. If there is a carbon market in the exporting country, it will only pay the difference.
Nearshoring in Mexico: In recent years in Mexico, the advance of nearshoring has slowed down because the country does not provide enough energy from renewable sources. Some industries have not been able to locate in Mexico because they could not meet the percentage of clean energy established in their goals.
U.S. tax credits: The extension of clean energy tax credits that support the development of solar and wind energy now includes an additional 10% credit for the inclusion of U.S.-made materials.

Embracing solar thermal in the path of decarbonizing the industry

As we connect the dots of industrial decarbonization, it becomes clear that proactive steps are essential. Solar thermal technologies offer a viable and immediate solution to the need for decarbonization. Industries are urged to take advantage of the technological advancements and economic incentives available today. By integrating solar heating and cooling systems into their operations, businesses can significantly cut their carbon footprint and enhance their sustainability credentials. Let’s work together—industries, policymakers, and consumers—to accelerate the adoption of solar thermal energy and create a sustainable future for all.

Author: Laura Yaniz Estrada, Communications Consultant.

26. March 202428. March 2024

Wanted: Women with green minds who care and dare

Women’s participation accelerates environmental decision-making.

CEOs, entrepreneurs, engineers, managers, marketers… the world needs a strong network of women with green strategic minds. To achieve sustainable goals, the industrial sector needs to transform its energy supply, and it has been proven that women’s participation accelerates environmental decision-making.

The industrial sector needs more women with green skills and green minds, women who know that caring is a strength, not a weakness.

Caring means thinking strategically to plan for the future, to be aware of the needs around us, to consider how many resources we have and how we can manage them. Caring also means being creative, finding solutions and passionately pursuing the projects that we know will improve our lives.

Throughout human history, caring has been delegated to women as unpaid, unrecognized and undervalued work. It became an undesirable trait that defined the professional paths of women, usually in subordinate and service positions. But now the world needs leaders who care… and women care.

Green care, green decisions

“Caring” is beyond the discourse of women having it like a natural “gift”, but a set of skills that are useful for people when making decisions: Supervision, vigilance, to look after, concern and responsibility, management skills, judgment, and more.

All these interpersonal skills are absolutely necessary to create a whole network of empowered people who can drive the energy transition that society needs to tackle climate change and achieve the Sustainable Development Goals (SDGs). We need more women to take these steps. It has already been proven that female leaders are more likely to support climate action and sustainability decisions.

Worldwide, the countries with a bigger share of women in their parliaments are more prone to ratify environmental treaties and adopt policies to address climate change. And we observe the same behavior in the private sector. According to a study by Bloomberg NEF and the Sasakawa Peace Foundation, companies with a higher proportion of women on their boards are more likely to improve energy efficiency, reduce the environmental impact of their businesses and invest in renewable energy

Women play a key role as promoters of a sustainability approach in their workspaces. Women’s leadership is, usually, long-term orientated which helps taking decisions to tackle issues like waste of energy and promoting the shift to renewable energy, according to a study conducted by the University of Urbino, Italy.

Energy sufficiency and efficiency and the integration of renewable energy sources are three processes women can lead in the corporate world.

It takes guts to become truly sustainable

Perhaps female leadership would take the green revolution to a deeper level: into the engine room of the factory, the heart and guts of any business. Using renewable energy sources from the origin to make products with a low carbon footprint or to offer clean services should be relatable to their very nature. Conventionally, decision makers in the industry have not dared to move away from fossil fuels in various stages of production. Apparently, the traditional option is reliable, efficient and cheap enough.

However, climate change and the geopolitical crisis have proven the opposite. Moreover, the development of clean technologies is mature enough to compete with the highly polluting options. Maybe the renewable energy lobby is not as powerful and aggressive as the fossil fuel lobby, and leaders still lack confidence in moving away from gas, oil or coal. More than 70% of global final energy consumption in the industrial sector is for heat generation, and 95% of this is met by burning fossil fuels. We, like humanity, must care about of this data. What if women change that?

There is a wide range of solar heating technologies that complement and synergize with other renewable energy sources to become the dream team of clean heat for industrial users from almost all sectors: food and beverage, chemical, pharmaceutical, automotive, mining, etc. The options range from plastic absorbers or air heating collectors that reach the temperatures required for drying processes in the agro-industry, to high-efficiency flat plate solar thermal collectors combined with heat pumps that reliably supply up to 90 °C for various processes, to concentrating solar systems that deliver heat above 350°C.

The shift to the relatively unknown solar heat may seem scary and risky. But if it takes guts, female leaders who care may be the ones daring to change. Alexandra Sutu from Solar Heat Europe is one of the female leaders in the renewable energy sector pushing for a better policy landscape in the European Union. Katrin Sprenger is the CEO of AKOTEC, a leading solar thermal collector manufacturing from Germany. Marisol Oropeza is the founder of the Heat Changers, the founder of the Heat Changers, an international initiative raising awareness about the market readiness, reliability, and potential of solar heating technologies for residential, commercial and industrial users. Take 17 minutes to listen what they have to say about decarbonization with solar in Europe.

Are you one of the female leaders in the industrial sector daring to become a heat changer and use solar heat in your factory? Reach out and, together, we can figure out how to take your sustainability efforts to a deeper level. There are plenty of female and male experts in the solar energy industry who will be more than glad to connect with leaders on the demand side to design tailored-made solutions.

Growing a green web

Despite women are half of the population, worldwide, only one-third is part of the renewable energy workforce, according to the International Renewable Energy Agency (IRENA). According to IRENA, there are some reasons why this is the case: firstly, there are cultural and social barriers based on perceptions of gender roles that can put girls off STEM careers from a young age. Then, the lack of flexibility in the workplace can lead to women hitting the glass ceiling and finally, the lack of mentorships.

However, there is data which backs the necessity to bring more women into the world of decision making. To bring about the necessary changes in companies towards renewable energy, we need women with STEM skills, but also CEOs who are convinced of the benefits of these decisions, women marketers, women salespeople, women managers – they can all act as mentors and collectively contribute to a strengthened green network.

The future will grow out of the green minds of women who really care.

Pass on the message to a woman who cares and is making a difference!

Written by Laura Yaniz Estrada, Communications Consultant.

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6. March 202428. March 2024

World, to the energy problem… we already have the solution!

Mundo, ante el problema de energía… ¡ya tenemos la solución!

World, to the energy problem... we already have the solution!

There are already solutions to unstable fuel prices and increasing greenhouse gas emissions. One of them concerns more than the 70% of the final use of energy in the industrial sector.

In 2022, industry, particularly in Europe and Asia, replaced the use of gas with coal – an archaic, highly polluting fuel harmful to human health – to meet its heat and power generation needs. This decision was primarily a response to the global energy crisis caused by the conflict between Russia and Ukraine.

Of course, this measure had consequences and led to a significant increase in emissions caused by burning coal, which mainly contributes to climate change and pollution.

However, there is a small glimmer of hope: against all fears, the increase in emissions from coal combustion was lower than estimated. According to the International Energy Agency (IEA), renewable energies played a major role in supplying the energy sources affected by the crisis and prevented the emission of up to 550 Mt of CO2 that year.

The sun: the answer for more than 70% of energy use

The IEA report highlights the contribution of wind power and solar photovoltaics in preventing emissions. These two renewable energy sources were mainly used to generate electricity. Imagine what the result would have been if more renewables had been used for 70% of final energy consumption: heat.

While 26% of global industrial energy use is for electricity, the remaining 74% is for processes that require a range of different degrees of heat. Currently, almost half of this demand is met by coal as the main fuel, a third by natural gas and 15% by oil, leaving less than a tenth for renewables.

The industrial sector is missing the opportunity to use energy sources that are on-site. We forget to look over our heads by continuing to rely on outdated energy that is dependent on fossil fuels, with a volatile market and highly polluting derivatives.

Today, technology and companies in the renewable energy sector have evolved to meet the needs of the industrial sector, which can have process requirements of over 400°C. This is the other side of solar energy: solar thermal energy.

Solar energy: differences in electricity and heat

Generally speaking, solar energy is clean, inexpensive and does not need to be transported, which reduces costs and risks in the supply chain. In particular, solar thermal energy is distinguished by its efficiency: It requires proportionally less space than photovoltaic systems because it is up to three times more efficient.

Pascual Polo, General Director of the Spanish Solar Thermal Industry Association (ASIT) and Heat Changer, explains in our podcast that 4 hectares are needed to generate 2 megawatts of electricity with photovoltaics, as they are able to harness 15-20% of the sun’s energy. By contrast, only one hectare is needed to generate the same 2 megawatts (thermal) with solar thermal collectors, as this other type of solar energy can utilize 70 to 80% of the sun’s radiation.

Solar thermal energy, also known as solar heat, fulfills exactly the same function as fossil fuels: to satisfy the heat generation demand. In other words, to heat water or other fluids and even to generate steam. There are already better, sustainable and efficient options for many industrial processes. Not using them is a cost factor for the economy.

The use of solutions such as solar thermal leads to an immediate improvement in financial planning, as it is not dependent on fluctuating fuel prices determined by geopolitical and financial market situations. It also reduces costs by reducing the carbon footprint of the process and products.

Thermal energy: investing in the future

So why have companies hesitated? Optimizing processes is an important step in the internal life of any company, but it is often only an economic one.

Daniel García, CEO of Módulo Solar, has identified some of the reasons why many industries avoid this decision. The first reason is fear and uncertainty about the guarantees in terms of savings and system lifetime. But also, the question of whether it is necessary to break with the paradigm in which their finances are managed, i.e. the fuel costs that are paid monthly. And a third problem: resistance to change and trying out new technologies.

The fact is that the use of renewable energy is not yet standard anywhere in the world. Until very recently, companies were used to not worrying about energy costs.

If the data proves the importance of switching energy supply sources for the most energy-intensive processes in industry, what will it take to turn words into action?

The savings guarantee already exists, and solar thermal companies are working to provide customers the certainty they need. Energy transition is a global step, and standards are different in every country. Daniel Garcia points out that it is important be aware of the different incentives granted by countries. For example, the costs related to the acquisition of renewable energy technology can be fully tax deductible in some countries. Others may be financing incentives, tax incentives and other types of instruments that make the change even more beneficial. A change that benefits companies and the planet. Especially companies from the food and beverage sector are using solar heat to reduce the carbon footprint as we recently elaborate on our article “Clean manufacturing with solar heat”.

Author: Laura Yaniz Estrada, Communications Consultant

Have a look at our content on social networks and other digital platforms to learn more about solar heat.