The physical climate scenario

Among the climate projections developed by the Intergovernmental Panel on Climate Change (IPCC)(1) on a global scale, the Group has selected two representing a specific level of emissions (the so-called “Representative Concentration Pathway”):

  • Representative Concentration Pathway 2.6 (RCP 2.6): compatible with global warming of less than +2 °C above pre-industrial levels by 2100, or an average of about +1 °C in 2081-2100;
  • Representative Concentration Pathway 8.5 (RCP 8.5): compatible with a scenario where no particular measures are taken to combat climate change, a so-called “business as usual scenario”. In this scenario, a mean global temperature increase of about 4.3 °C above pre-industrial levels is forecast for 2081-2100.

In the RPC 8.5 climate projections, the Mediterranean and Central/South America will experience a significant increase in average temperatures and a substantial decline in precipitation, with the effects becoming more pronounced in the second half of the century and the impact increasing up to 2100. In the RCP 2.6 scenario, the effects will be similar but less intense, with the trend slowing in the second half of the century, thereby producing a substantial differential between the two scenarios in 2100.

The scenarios are global in nature. Accordingly, in order to determine their effects in the areas of relevance for the Group, a collaborative initiative has been started with the Earth Sciences department of the International Center for Theoretical Physics (ICTP) of Trieste. As part of this collaboration, the ICTP provides projections for the major climate variables with a grid resolution of 50 km2 and a forecast horizon running from 2030 to 2050. The main variables are average temperatures, rainfall and snowfall and solar radiation. The first phaseof the  study conducted in 2019 involved Italy and Spain, with the consequent definition of a preliminary physical scenario.

(1)The IPCC, founded in 1988 by the UNEP (United Nations Environment Program) and the WMO (World Meteorological Organization), is the main international body for the assessment of climate change. The IPCC provides science-based climate analysis in order to support governments in developing policies to combat climate change.

Italy

Acute phenomena: in the 2030-2050 period, heat waves are expected to increase appreciably both in terms of frequency and geographical distribution, especially in the southern regions of the country. In these  scenarios, the intensity of extreme rain and snowfall events increases sharply, but their frequency declines compared with historic trends.

Chronic phenomena: the average annual temperature is expected to increase over the 2030-2050 period in both the RCP 2.6 and 8.5 scenarios. In the RCP 8.5 scenario, the temperature is expected to rise by an average of 0.4 °C compared with the RCP 2.6 scenario in the 2030-2050 period,  with the differential then widening significantly in the second half of the century. Chronic changes in temperature can be analyzed to obtain information on the potential effects on cooling and heating demand in local energy systems. In terms of heating days (HDs), i.e. days with a temperature below 15 °C, and cooling days (CDs), or days with a temperature above 24 °C, the 2030-2050 period will see HDs decrease by 14% and CDs increase by 60% in the RCP 2.6 scenario, while the RCP 8.5 scenario will see a larger decline in HDs (-17%) and a larger increase in CDs (+80%).

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Spain

Acute phenomena: over the 2030-2050 period, heat waves are expected to increase appreciably in frequency, with their geographical spread expected to expand, especially in the southern area of the country.   Extreme rainfall will increase in intensity but its frequency will decline. At the same time, extreme snowfalls will largely remain located in the current geographical areas but their frequency and intensity could decline sharply.

Chronic phenomena: the average annual temperature is expected to increase over the 2030-2050 period in both the RCP 2.6 and 8.5 scenarios. In the RCP 8.5 scenario, the temperature is expected to rise by an average of 0.4 °C compared with the RCP 2.6 scenario in the 2030-2050 period, with the differential then widening significantly in the second half of the century. In terms of heating days (HDs) and cooling days (CDs) the 2030-2050 period will see HDs decrease by 6% and CDs increase by 29% in the RCP 2.6 scenario, while the RCP 8.5 scenario will see a larger decline in HDs (-10%) and a larger increase in CDs (+43%).

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The transition scenario

The transition scenario depicts the evolution of industrial and business sectors in an economic, social and regulatory context consistent with different trends in greenhouse gas (GHG) emissions and, therefore, is correlated with the RCP 2.6 and 8.5 climate scenarios. The Group has therefore equipped itself with quantitative tools that incorporate assumptions regarding the context to produce corresponding projections for energy demand, electricity demand, electricity production, the penetration of renewables and electric vehicles, etc.: in short, all the variables that characterize a national energy system relevant to the Group’s activities.
In defining the transition scenarios, we distinguish between:

  • assumptions concerning the global macroeconomic and energy context in terms of commodity prices, interest rates, gross domestic product etc., using international benchmarks produced by entities such as the International Energy Agency (IEA), Bloomberg New Energy Finance (BNEF), International Institute for Applied Systems Analysis (IIASA), etc. With regard to IIASA, for example, consideration was given to the fundamentals driving the “Shared Socioeconomic Pathways” (SSPs), in which general energy scenarios related to physical climatic scenarios are developed. The information deriving from the “SSPs” is used to support long-term forecasts on commodity prices;
  • assumptions concerning local policies and regulatory measures associated with the fight against climate change, such as the reduction of carbon dioxide emissions, the efficiency of the energy system, the  decarbonization of the electricity sector, the reduction of oil consumption etc. For Italy and Spain, reference is made to those countries’ integrated National Energy and Climate Plans (NECPs), which are also approved at the European level, while outside Europe, reference is made to the respective national energy programs of the countries involved. In order to define the transition scenario for the electricity sector, the Group considers the elements described above (physical scenarios, assumptions about the macro and energy context, regulatory developments) as prerequisites for the assessment of future projections of electricity demand, electricity generation, renewables etc.

In this context, the effect of temperature on electricity demand in the long term (2030-2050) has been estimated. Italian electricity demand is provisionally forecast to increase on average by up to 5%, due to the combined effect of the chronic increase in temperature and the transition of the system towards greater electrification of energy consumption.
Moreover, in the RCP 8.5 physical scenario the probability of extremely hot years increases, leading to a future increase of up to 10% in electricity demand, together with the risks associated with more frequent extreme weather events. In the case of Spain, however, over the same time horizon the chronic effects would involve an average increase in demand of around 2% and, in the possible peak year of the RCP 8.5 scenario, it could reach 4%. The smaller increase in electricity demand in Spain compared with Italy mainly reflects the narrower scope for the future electrification of consumption, as it is currently already largely electrified as a consequence of the presence of nuclear power in the country. These effects only reflect the long-term impact of temperature on electricity demand and the inertial evolution of the national energy system. They do not consider the repercussions of climate change on economies underscored in the IPCC’s special report on global warming, which could also have indirect effects on economies and, therefore, on electricity demand.

Effects on electricity demand (2030-2050)

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