Economics of Sector Coupling

This chapter presents an introduction on the main characteristics of sector coupling, which is often referred to with P2X, where “X” may stand for various applications, such as gas (G), heat (H), vehicles (V) or others. The common feature of these technologies is to provide additional flexibility to the power grid by the integration with other energy networks or sectors, converting electricity into other energy carriers. Sector coupling is still an emerging concept, with its first applications being deployed to exploit the electricity excess from variable renewable sources in specific contexts, but with difficulties in achieving competitive returns due to the limited annual capacity factors. However, decreasing investment costs and increasing needs of long-term electricity storage solutions may trigger an interest in sector coupling technologies.