Sector Coupling – key technologies of the energy transition

Large quantities of fossil fuels are still being used to generate heat and as transport fuel. Sector coupling is the technological approach to replacing these energy sources with environmentally friendly electricity.
Table of contents
19.06.2024
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    Concept

    What is Sector Coupling?

    Sector coupling means replacing fossil fuels with renewable energy sources and finding cross-sector solutions that allow more efficient energy utilisation on the one hand and compensate for the volatility (fluctuating quantities) of renewables on the other.

    In connection with volatility, it must be mentioned that sector coupling is closely linked to the introduction of ‘smarter’ / ‘more intelligent’ electricity grids, as a balance between consumption and generation can only be realised through constant measurement and control. 

    Sectors

    Which sectors are involved?

    As with sector coupling, there are also several different terms for the sectors themselves. The energy sectors electricity, heat, gas and mobility are contrasted with the consumption sectors household, trade, industry and transport (including transport). In most descriptions of sector coupling, the following mixed form is found: electricity, heat and transport (mobility), occasionally supplemented by industry as a major consumer or user of specific solutions. A categorisation according to the economic consumers of energy is also frequently used: energy sector, industrial processes, manufacturing industry, agriculture, waste and wastewater, etc.  

    Goal

    What is the aim of Sector Coupling??

    Sector coupling should make a decisive contribution to achieving ambitious climate protection targets. This is achieved through the increased use of renewable electricity to replace fossil fuels in the transport, heating and industrial sectors. In addition, the use of efficient technologies should reduce the total amount of energy required. The most important overarching goal is the reduction of greenhouse gases, which are produced when burning coal, natural gas or oil and drive climate change. Furthermore, sector coupling should also contribute to the abandonment of nuclear energy.  

    Implementation

    What types of Sector Coupling exist?

    One of the most effective forms of sector coupling is the provision of space heating or hot water using a heat pump. As no energy is ‘generated’ (converted) here, but only transported from one temperature reservoir to another, the heat pump achieves the seemingly impossible. The energy provided as heat is many times greater than the electrical energy used. Find out more about the heat pump here.

    The direct heating of a storage medium using an electric resistance heater (like the heat pump, this is part of power-to-heat sector coupling) is associated with low energy losses, but only as much heat energy can be generated as the electrical energy used.  

    The use of solar power for electric vehicles is particularly favourable and climate-friendly. The freely accessible and free solar energy is converted into electricity, which is used to charge the batteries of the electric car. It could hardly be cheaper. In addition, the electric motor utilises the energy supplied much better than a combustion engine: efficiency levels are over 70 percent compared to around 30 percent (the figures vary greatly here). If electricity from your own roof is used for the electric car, the overall balance is likely to be even better.  

    While heat pumps and electromobility excel in terms of efficiency, other forms of sector coupling often have a less convincing overall energy balance. For example, the conversion of electricity into hydrogen, methane (power-to-gas) or synthetic fuels (power-to-liquid, e-fuels) is itself very energy-intensive. The overall efficiency of hydrogen cars is assumed to be below 20 % - the key reason why it does not make sense to rely on this technology across the board.

    There are two main reasons why the less efficient forms of sector coupling do not have to be discarded from the outset: Firstly, converting electricity into hydrogen, for example, makes it easy to store energy and thus opens up an opportunity to compensate for fluctuations in the supply of renewables. Secondly, applications that require a high energy density can be realised in this way. For example, hydrogen combustion can be used to generate enough energy to melt steel. This is not possible with a heat pump. 

    Strom für die E-Mobilität durch Sektorenkopplung
    Energy Transition

    Sector Coupling and Energy Transition

    For around 200 years, i.e. since the beginning of the industrial age, people have been burning large quantities of fossil fuels. The carbon trapped in the earth's interior in the form of coal, oil or gas is released as CO₂. The concentration of the greenhouse gas has demonstrably increased from values between 150 and 300 ppm to well over 400 ppm, and the trend is rising. This may not seem like much at first glance (ppm stands for parts per million), but it has far-reaching consequences. Carbon dioxide, but also other greenhouse gases such as methane or nitrous oxide, contribute to the so-called greenhouse gas effect. The higher their concentration in the atmosphere, the more it heats up, as the gases prevent the heat from being radiated back into space.  

    Replacing fossil fuels with electricity

    The effects of a higher average global temperature are now hard to ignore and the task of reducing greenhouse gas emissions is becoming increasingly urgent. Sector coupling offers a technical way of reducing the amount of fossil fuels used for energy generation, heat production and transport and replacing them with renewable energies. Alongside energy saving, sector coupling therefore plays a central role in the energy transition in Germany.  

    Different successes in the sectors

    If we analyse the sectors according to their share of greenhouse gas emissions, the energy industry is right at the top, followed by the industrial sector and transport. These three sectors are responsible for around three quarters of total emissions; together with the building sector, the figure is as high as 90 %. The greatest potential for savings therefore lies in these sectors.  

    While significant savings of around 40 % have already been achieved in the energy sector since 1990, the transport sector has stagnated - CO₂ emissions have remained virtually unchanged for over 30 years. This is set to change, particularly with the help of the switch to electromobility. The role that synthetic fuels or hydrogen will play in the ‘transport revolution’ is still being debated. While the potential for private vehicles is probably rather low, hydrogen-based solutions for heavy machinery, buses and lorries etc. are conceivable.  

    The brochure ‘Climate protection in figures’, published by the Federal Ministry of Economics and Climate Protection (BMWK) in 2022, provides an overview of what has been achieved so far.

    Is Sector Coupling only conceivable with renewable energies?

    In principle, all the processes mentioned can also be realised with fossil fuels. Whether the heat pump, the electric car or the electrolysis of water are powered by green or fossil electricity is technically irrelevant. In other words, sector coupling also works with electricity that is not generated in an environmentally friendly way. This is also necessary, as around half of the current German electricity mix still consists of energy generated from fossil fuels. 

    The question remains: Does sector coupling with fossil fuels make sense? The answer to this question is a clear no, with the possible exception of heat pumps. Otherwise, the conversion of electricity into mobility or heat always means a certain loss of energy, a further step that reduces the overall efficiency of the system. Not only does this equate to economic losses, it also brings no benefits for climate protection. In other words, sector coupling is only effective if the electricity used comes from renewable sources.

    Another important argument in favour of using renewable energies in the context of sector coupling is energy generation close to consumption. If the electricity comes from your own roof, for example, the transport routes and associated losses are very low. To ensure that this advantage actually comes to fruition, decentralised energy generation is always preferable to large-scale projects with long transport routes.

    PV-Strom für die Sektorkopplung
    Photovoltaic

    Sector Coupling and PV

    Having your own photovoltaic system on the roof is the ideal way to drive forward sector coupling in your own household. You can use the low-cost electricity to:

    • charge your electric car
    • heat your home (hot water heat pump)
    • produce hot water (electric immersion heater or domestic hot water heat pump)

    This not only reduces your energy costs, but also avoids a lot of CO₂ emissions. With rising prices for fossil fuels and carbon dioxide, sector coupling is increasingly paying off.

    And you have even more opportunities to benefit from sector coupling. With an intelligent energy management system such as our SOLARWATT Manager, solar power can be made available to consumers whenever there is enough surplus to run the appliances. It can also be used to set different priorities for the individual large consumers. This allows you to get the most out of your solar power and avoid using expensive grid electricity.

    As part of sector coupling, it makes sense to fully utilise the roof area and cover it with as many solar modules as possible. Electricity that is not used immediately can be stored for the evening hours with an electricity storage system such as our Battery flex. Every kWh of self-consumption saves you the cost of increasingly expensive grid electricity.  

    Warmwasser aus Strom Dank Sektorenkopplung
    Definition

    What concepts exist for Sector Coupling?

    The question of a definition of the term sector coupling has not yet been conclusively clarified. Scientists at Fraunhofer ISI have put forward the following proposal, among others, for discussion:

    ‘Renewable energy sources (wind, PV, biomass, solar or geothermal energy, ...) substitute fossil fuels in new applications or through increased utilisation of known applications. This is done, among other things, either by using electricity directly or by converting electricity into synthetic fuels (power-to-gas, power-to-liquid) or into heating/cooling (power-to-heat), which can be summarised as power-to-X (PtX).’

    The authors themselves point out that this definition of sector coupling is quite narrow and does not include all aspects and perspectives.  

    Source: Wietschel et al.: Sector coupling - definition, opportunities and challenges (Working Paper Sustainability and Innovation No. S 01/2018, Fraunhofer ISI)

     

    The German Wikipedia states the following about sector coupling:  

    ‘Sector coupling (also known as sector coupling or integrated energy in English) refers to the networking of the sectors of the energy industry as well as industry, which are to be coupled, i.e. optimised in a joint holistic approach. Traditionally, the electricity, heating (or cooling), transport and industry sectors have been considered largely independently of each other.’

    While the first definition therefore focuses on replacing fossil fuels with renewable energies, the second focuses on the overarching optimisation of all sectors. However, the two concepts are not mutually exclusive, but complement each other. 

    FAQs on Sector Coupling

    What does Sector Coupling mean?

    In sector coupling, energy systems from different sectors - heat, electricity, transport - are linked together. The aim of sector coupling is to reduce CO2 emissions and thus contribute to the energy transition and climate protection. The use of renewable energies is therefore at the centre of sector coupling.

    Renewable energies currently play a particularly important role in the electricity sector. For this reason, and due to their particularly high efficiency, there is a strong focus on making ‘clean’ electricity usable in other sectors as well. This is possible in the heating sector, for example, by operating heat pumps with electricity from solar or wind energy. Electromobility is another example of the successful coupling of the electricity and transport sectors.

    What sectors are there?

    Different terms are used for sectors depending on the context. While the energy sectors are usually subdivided into electricity, heat, gas and mobility, the consumption sectors include the categories household, trade, industry and transport (or also transport). Sector coupling in relation to climate protection centres on a mixture of the electricity and heat sectors (and therefore also buildings) as well as industry and transport. In the electricity sector in particular, the expansion of renewable energies is already well advanced. Other sectors benefit from this: the heating sector, for example, through electricity-powered heat pumps, the building and industrial sector from electricity from photovoltaic systems and the transport sector from electromobility. 

    Why Sector Coupling?

    Sector coupling is an important building block for the energy transition and achieving climate targets. It helps to increase energy efficiency and reduce dependence on fossil fuels, which can have a favourable impact on energy costs in the future.

    In addition, sector coupling helps to balance out the volatility of renewable energies. If there is a surplus of electricity, the electricity that is not needed can be used to produce fuel for the transport sector or to produce hydrogen by electrolysis, for example. Storage technologies help to make surplus electricity usable at a later date.

    Does Sector Coupling make sense?

    Even today, electricity from renewable sources is cheaper to generate than conventionally produced electricity. This makes sector coupling a key component of the energy transition, as it enables the electrification of all sectors, allows increasing independence from fossil fuels and therefore makes both economic and ecological sense.

    However, this applies first and foremost when renewable energies are used. Sector coupling is also possible with fossil-based energy sources. However, it is then less efficient and contributes little to climate protection.