How can effective communication between energy stakeholders create synergies which allow

for successful sector coupling implementation?

The steady increase in global energy consumption by sector over time has revealed the need for new
approaches towards tackling the challenge of decarbonization. Arguably, the approach of sector
coupling (SC) could de-linearize energy generation in order to increase efficiency and reduce costs, thus
facilitating this decarbonization. In essence, SC looks “to integrate the rising share of variable renewable
energy in the power sector” with the end-use sectors (Olczak and Piebalgs, 2018). SC could therefore be
the solution for meeting the “mandatory greenhouse gas emission targets set in the UK Climate Change
Act, which requires emissions to be cut by 80 per cent by 2050 compared to 1990 levels” (LSE, 2014).

Successful SC merits the cyclical linkage between technology, policy and integration. In regard to policy,
determining the stakeholders in our energy systems will create effective communication flows for SC
implementation. Thus, this paper will analyze how effective communication between energy
stakeholders can create synergies which allow for successful SC implementation. Firstly, this paper will
determine the stakeholders in SC. Then it will evaluate how communication takes place between them.
Lastly, it will look at the ways SC can be communicated to consumers. The ultimate purpose of this
paper is to examine how effective communication amongst energy stakeholders in SC can in part
contribute to decarbonization.

Stakeholders in SC
In order to examine how sector coupling can provide a reliable, efficient and affordable solution for the
shift towards decarbonized energy, we need to examine the stakeholders present in the current energy
system. Market coordination between stakeholders is key, since “any business model – to be successful
in the long term – requires the entire chain of users, producers and infrastructure” to be working
seamlessly together (Boeve et al., 2018). This coordination can lead to a well-integrated energy system,
such as for Germany whose “broad energy technology mix [by 2050] would be €600 bn cheaper than a
system that is strongly dependent on electricity only” (Gorenstein Dedecca et al., 2018). Thus, Figure 1
has been created based on the literature examined in order to illustrate the observed stakeholders in
SC.

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 Governments
(International, National
and Local)

Sector
Coupling

Producers (Energy
Consumers (Individuals
Industry, Technology
and Coorporations)
Developers, Investors)

Figure 1 – Stakeholders in Sector Coupling

As seen above in Figure 1, there are three major stakeholders in SC. In no particular order, these
stakeholders can be defined as governments, producers and consumers. When evaluating
communication in regard to government, we can look at the international, national and local flows of
communication and then examine the ways that they interact with consumers and producers. The same
can be said for producers, encompassing the interactions between the energy industry, technology
developers, and investors, whose communication flows link with governments and consumers. Lastly,
consumers comprise of individuals and corporations, who interact with producers and governments
through top-down/bottom-up communication flows.

When examining the flows between these stakeholders, it is not possible to take a “one-size-fits-all
solution, [since] all countries should set themselves targets…and develop strategies on how to achieve
them, coupled with measure for energy efficiency” (IRENA, IEA & REN21, 2018). For example, when it
comes to addressing the Power to Gas system solution, creating dialogue between politicians and public
awareness can facilitate successful implementation (German Energy Agency, 2015). These
communication flows would produce a causal effect due to the interconnectedness of these industrial
processes, meaning “any change to one part of the process will have to be accompanied by changes to
other parts of the process” (De Pee et al., 2018).

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Communication between sectors/governments
Sector coupling is instrumental in reducing electricity surplus and lowering energy costs. In order to
achieve this, “integrated planning and operation of energy infrastructure at all levels is needed,
considering interlinkages between the electricity, gas and heat sectors, to ensure that new investments
are future proof and minimise overall system costs” (Gorenstein Dedecca et al., 2018). Thus, creating
cross-sectoral synergy requires heightened communication amongst sectors and governments in order
to evaluate these interlinkages needed for policymaking.

In terms of cross-sectoral regulation, we can look to the example of the electricity and natural gas
markets, which have two separate sets of regulation. This means that each market design, respectively,
forces them to address the issue of scarcity or surplus internally. Linking both markets together, as
proposed in the 2015 Gas Target Model, would “introduce a legally-binding obligation on gas and
electricity TSOs to cooperate with each other, inter alia, through a better exchange of information”
(Olczak and Piebalgs, 2018). Establishing these communication schemes at EU and national level would
help these gas and electricity networks to “better manage the balancing of supply and demand energy,”
which would in turn deliver the efficiency benefits that come from SC (GIE, 2019).

When looking to prevent these market coordination failures, we need policies aimed at addressing all
parts of the value chain for each of these markets, so that we can facilitate the inter-linkages amongst
them. As an example, Boeve et al. (2018) said that “public policies supporting development of hydrogen
distribution infrastructure and policies supporting RTD for fuel cells are not sufficient if there is no policy
discouraging carbon emissions in the production of hydrogen.” Ensuring that effective communication
allows for the internal coordination of policy change within the value chain, will be just as important as
working to link the different energy markets in SC.

Joint planning amongst countries in the EU is needed to link the communication process for the
development of the gas and electricity network, in order to reduce the number of regulatory bodies that
network operators are required to submit plans to (GIE, 2019). This will facilitate greater communication
through information sharing, which will gain “growing importance as the EU energy system becomes
increasingly decentralised” (Olczak and Piebalgs, 2018). Governments should thus look to make sure

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that planning and communication is done on both a national and local level, so that there are no delays
in bringing about SC.

Electricity transport is another area of SC that can see benefits from joint planning. Flexible electricity
transport has “prevented Germany from experiencing blackouts during recent periods of high
renewable electricity production and low demand, by exporting its excess electricity to neighbouring
countries, primarily Switzerland, Austria and the Netherlands” (Gorenstein Dedecca et al., 2018). It is
then imperative to develop these communication schemes and policing linking SC amongst countries, so
that energy is not wasted or unavailable in times of need.

Based on the global political climate of the last few decades, it has become increasingly important to
transition to SC. International conflicts like the “Russian annexation of Crimea and events like the oil
crisis in the 1970s have shown the vulnerability of the EU economy due to its high energy import
dependence” (Gorenstein Dedecca et al., 2018). Due to the uncertainty of global tensions, national
regulation that will be communicated needs to clearly state rules for “admixture, infrastructure
connection and access to capacity, and commercial arrangements for local gas producers” (Gorenstein
Dedecca et al., 2018). This will allow countries to reduce interdependence on foreign energy and narrow
their focus on facilitating communication amongst national and local stakeholders.

Communication of sector coupling to consumers

When it comes to communicating the concept of sector coupling to consumers, it is essential that the
public feels as though it is something that is being done with them and not to them. Public consultations
are a solution which allow for consumer input and the communication of SC as a cost-competitive
solution (Olczak & Piebalgs, 2018). One of the most cost-competitive and flexible solutions to
decarbonizing energy demand within SC is electrification (Gorenstein Dedecca et al., 2018). Having
consumers involved in the electrification process can dictate public preferences and consumption
patterns towards this technology.

Cohesion in the decision-making process of integrating technology is essential, so that the public is more
willing to accept processes like electrification (Mihalakakou, Paravantis & Stigka, 2014). Technology such
as electric vehicles (EVs) and heat pumps are available to consumers but are not necessarily chosen by
them. It is important to not only make consumers more aware of the benefits of these technologies, but

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to also dictate the way they use them. A complete transition to EVs is only possible if effective
communication of charging practices is relayed to consumers, since “it has been shown that if 30% of
consumers simultaneously started charging electric vehicles, this could create blackouts in the electricity
system” (Gorenstein Dedecca et al., 2018).

Policies need to be developed with the integration of all stakeholders and sectors in mind, rather than
the current structure of individual sector development. This can help to avoid stranded consumer
preferences for technology such as EVs, since effective SC policy will see the adaptation of technology
will vary according to local demand and application (Gorenstein Dedecca et al., 2018). Recent policies in
sectoral integration place a lack of importance on having an informed consumer, since as of 2016 “the
global energy sector employed some 41 million people…[of which] 3% [was] ‘marketing and
administrative personnel’” (IRENA, IEA & REN21, 2018). Changing these policies will enable people to
take a bottom-up approach to making changes to their homes and lifestyles through integration of SC
technologies.

Conclusions
As the EU shifts towards a more decentralized renewable energy system, “decentralized renewable
energy solutions will play a key role in achieving universal access to modern energy services by 2030– a
target within the Sustainable Development Goal (SDG) 7 on energy” (IRENA, IEA & REN21, 2018). In
order for this decentralization to lead to the eventual decarbonization of the energy sector, the research
concluded that effective communication between the three major stakeholders in sector coupling
(governments, producers, and consumers) can ensure its success. It is clear that there is not a one-size-
fits-all approach, since stakeholder coordination and communication on a country level could determine
individual need and strategies when it comes to integrating SC. In creating this push to transition the
energy system, change in one part will prompt changes to other parts, which can ultimately result in a
full system change towards SC.

This paper analyzed the communication needed to link the various stakeholder processes together, and
it found that effective communication can minimize the overall costs by creating efficient infrastructure.
Linking these sectors together by implementing policies that tackle all processes of the value chain,
addresses the issue of internal scarcity and surplus amongst the individual sectors. Looking to
governments to engage in joint planning dialogues to facilitate this decentralization on a national and
local level is imperative in developing energy independence. As stakeholders, consumers play a major

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role in the implementation and usage of these end-use technologies. Public consultations and clear
communication of SC technology is vital for involving consumers in the electrification process and
integrating technologies like heat pumps and EVs in their daily lives. When it comes to future policy
planning for SC, creating policy that mandates cohesion through effective communication to and from
these stakeholders can cut costs and increase efficiency in this energy transition.

As the world is shifting from nuclear and fossil fuels, effective sector coupling is the way to decarbonize
energy. Ultimately policy needs to keep in mind the communication flows between the different
stakeholders in SC, in order to ensure that these processes can eventually contribute to decarbonization.
Through decarbonization we can eventually come close to meeting net-zero emissions and limit rising
global temperatures, in order to have a more sustainable future.

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