GLOBAL STEG
MARKET OUTLOOK
ESKOM CSP AND SOLAR AUGMENTATION
CONFERENCE, JOHANNESBURG
DEREK CAMPBELL
26 AUGUST 2013
/ / / / / / // // /// / / / / / / / / / / / / / / / / / / /
GLOBAL STEG MARKET OUTLOOK, 26 AUGUST 2013
1
THE DEFINITIVE SOURCE OF INSIGHT, DATA AND NEWS
ON THE TRANSFORMATION OF THE ENERGY SECTOR
London
Zurich
San Francisco
Beijing
New York
Washington
Tokyo
Hong Kong
New
Delhi
Singapore
Sydney
Sao Paulo
Cape Town
/ / / / GLOBAL STEG MARKET OUTLOOK, 26 AUGUST 2013
2
COVERAGE: UNIQUE BREADTH....
SECTORS
RENEWABLE
ENERGY
ENERGY-SMART
TECHNOLOGIES
Smart Grid & Demand
Response,
Power Storage,
Advanced Transportation,
Energy Efficiency
Wind
Solar
Biofuels, Biomass & Waste
to Energy
Geothermal
MARKETS
RENEWABLE
ENERGY
CERTIFICATES
CARBON MARKETS
EU ETS
Australia
EU RECs
Global / Kyoto
North America RECs
North America
Asian RECs
CCS
POWER
WATER
GAS
/ / / / GLOBAL STEG MARKET OUTLOOK, 26 AUGUST 2013
3
CONTENTS
1. CURRENT STATE OF THE MARKET
2. POTENTIAL TO REDUCE LCOE
3. IMPLICATIONS OF NATURAL GAS ON STEG
4. 2014 AND BEYOND
/ / / / GLOBAL STEG MARKET OUTLOOK, 26 AUGUST 2013
4
NEW BUILD ASSET FINANCE OF STEG PROJECTS BY
REGION, 2005-2012 ($BN)
25,000
19.3
20,000
15,000
ASOC
AMER
10,000
EMEA
4.5
5,000
0
0.04
2005
1.2
1.9
2006
2007
5.6
5.3
2.4
2008
2009
2010
2011
2012
Source: Bloomberg New Energy Finance
/ / / / GLOBAL STEG MARKET OUTLOOK, 26 AUGUST 2013
5
GLOBAL SOLAR THERMAL CAPACITY, 1995-2013 (MW)
Source: Bloomberg New Energy Finance
/ / / / GLOBAL STEG MARKET OUTLOOK, 26 AUGUST 2013
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ABANDONED STEG PROJECTS (MW)
2,500
2,000
1,500
2,135
1,000
1,654
500
729
50
255
2007
2008
1,633
934
0
2009
2010
2011
2012
2013
Source: Bloomberg New Energy Finance
/ / / / GLOBAL STEG MARKET OUTLOOK, 26 AUGUST 2013
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WHY THE SLOWDOWN?
PV
POLICY
SUPPORT
Rapid decline of PV costs makes STEG a less attractive
option for generating clean energy from large sunny areas
Partly in consequence of runaway PV build (and also the
Spanish debt crisis), government support has been removed or
switched to PV. PV wins solar tenders.
FINANCE
Initial capital expenditure is high and there have been
bankruptcies as companies struggle with liquidity
WATER
Increasing concern over availability of water resources for
cooling and washing
/ / / / GLOBAL STEG MARKET OUTLOOK, 26 AUGUST 2013
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CONTENTS
1. CURRENT STATE OF THE MARKET
2. POTENTIAL TO REDUCE LCOE
3. IMPLICATIONS OF NATURAL GAS ON STEG
4. 2014 AND BEYOND
/ / / / GLOBAL STEG MARKET OUTLOOK, 26 AUGUST 2013
9
SOLAR THERMAL LCOE’S ($/MWH)
Source: Bloomberg New Energy Finance
/ / / / GLOBAL STEG MARKET OUTLOOK, 26 AUGUST 2013
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TECHNOLOGY INNOVATION
CURRENT COST
• Cost of components (eg mirrors, steam
turbines) is extremely high
• Each plant is designed differently, so
skilled engineers are required and
customisation difficult
REDUCING COSTS
• Reducing component costs through
optimising design to use less material, or
lower cost material, or to improve
efficiency
• Achieve economies of scale through
increasing the plant size
• Add storage, or hybridise STEG with
fossil fuel, to increase utilisation of the
turbine. This can also help STEG power
output match power demand –
something PV or wind cannot do
Source: Bloomberg New Energy Finance
/ / / / GLOBAL STEG MARKET OUTLOOK, 26 AUGUST 2013
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CONTENTS
1. CURRENT STATE OF THE MARKET
2. POTENTIAL TO REDUCE LCOE
3. IMPLICATIONS OF NATURAL GAS ON STEG
4. 2014 AND BEYOND
/ / / / GLOBAL STEG MARKET OUTLOOK, 26 AUGUST 2013
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GAS EFFECTS ON STEG
• Gas reserves risen by 34%
between 2000-2012
• Large pipeline of LNG terminals
and exploration
• Cheaper gas means cheaper
BCM
TCM
200
4,000
180
3,600
160
3,200
140
2,800
120
2,400
100
2,000
80
1,600
60
1,200
40
800
20
400
0
electricity
0
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Consumption
Production
Reserves
• Gas sets the price of electricity and
reduces peak hour prices for STEG
Source: B.P, Bloomberg New Energy Finance
/ / / / GLOBAL STEG MARKET OUTLOOK, 26 AUGUST 2013
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LCOE IN 2013 ($/MWH)
Marine - wave
Marine - tidal
STEG - LFR
STEG - tower & heliostat
STEG - parabolic trough + storage
Fuel cells
Wind - offshore
STEG - parabolic trough
STEG - tower & heliostat…
PV - thin film
PV - c-Si tracking
Biomass - gasification
PV - c-Si
Geothermal - binary plant
Wind - onshore
Municipal solid waste
Biomass - incineration
Geothermal - flash plant
Landfill gas
Biomass - anaerobic digestion
Large hydro
Small hydro
Nuclear
CHP
Natural gas CCGT
Coal fired
0
50
100
150
200
Global LCOE range
Regional scenarios
1059
861
531
250
300
Q1 2013 central
350
400
Q2 2013 central
450
500
Source: Bloomberg New Energy Finance
/ / / / GLOBAL STEG MARKET OUTLOOK, 26 AUGUST 2013
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CONTENTS
1. CURRENT STATE OF THE MARKET
2. POTENTIAL TO REDUCE LCOE
3. IMPLICATIONS OF NATURAL GAS ON STEG
4. 2014 AND BEYOND
/ / / / GLOBAL STEG MARKET OUTLOOK, 26 AUGUST 2013
15
2014 AND BEYOND
• There will be some markets where the advantages of STEG over PV are
valued – for example, weak power grids, or countries with a strong evening
electricity demand peak
• Several countries (Australia, Morocco, India) are also offering tenders for one
or two large STEG projects
• Saudi Arabian market 2.1GW in 2 rounds of bidding, by 2032 25GW
(although BNEF believes the long term target may be shifted towards PV)
• Cost reductions and technology improvements continue to be made by
companies like BrightSource and Abengoa, which are building plants and
gaining the experience to make the technology better
/ / / / GLOBAL STEG MARKET OUTLOOK, 26 AUGUST 2013
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/ / / / GLOBAL STEG MARKET OUTLOOK, 26 AUGUST 2013
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PRESENTATION TITLE
DEREK CAMPBELL, [email protected]
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