ETP 2012 complete slide deck Slide deck
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ETP 2012 complete slide deck Slide deck You are very welcome to use the contents of this slide deck as long as you reference them as IEA - Energy Technology Perspectives 2012 \ Most graphs and the data behind them are available for download from http://www.iea.org/etp/secure/, the required password received upon purchase of the book. For questions please contact the ETP team etp_project@iea.org © OECD/IEA 2012 Table of contents To jump to a specific section: Right click, then hit “open hyperlink” 0. Context Part 1. Vision, Status and Tools for the Transition 1. Global Outlook 2. Tracking Clean Energy Progress 3. Policies to Promote Technology Innovation 4. Financing the Clean Energy Revolution Part 2. Energy Systems Thinking 5. Heating and Cooling 6. Flexible Electricity Systems 7. Hydrogen Part 4. Scenarios and Technology Roadmaps 11. Electricity Generation and Fuel Transformation 12. Industry 13. Transport 14. Buildings 15. Roadmaps 16. 2075: can we reach zero emissions 17. Regional Spotlights Part 3. Fossil Fuels and CCS 8. Coal Technologies 9. Natural Gas Technologies 10. Carbon Capture and Storage Technologies 17.1 ASEAN 17.2 Brazil 17.x Japan 17.3 China 17.4 European Union 17.5 India 17.6 Mexico 17.7 Russia 17.8 South Africa 17.9 United States © OECD/IEA 2012 Context Chapter 0 © OECD/IEA 2012 ETP 2012 – Choice of 3 Futures 2DS a vision of a sustainable energy system of reduced Greenhouse Gas (GHG) and CO2 emissions The 2°C Scenario 4DS reflecting pledges by countries to cut emissions and boost energy efficiency The 4°C Scenario 6DS where the world is now heading with potentially devastating results The 6°C Scenario © OECD/IEA 2012 Sustainable future still in reach Is a clean energy transition urgent? Are we on track to reach a clean energy future? Can we get on track? YES ✓ NO ✗ YES ✓ © OECD/IEA 2012 Recommendations to Governments 1. Create an investment climate of confidence in clean energy 2. Unlock the incredible potential of energy efficiency – “the hidden” fuel of the future 3. Accelerate innovation and public research, development and demonstration (RD&D) © OECD/IEA 2012 Key messages 1. 2. 3. 4. 5. Sustainable energy future is still feasible and technologies exist to take us there Despite potential of technologies, progress is too slow at the moment A clean energy future requires systemic thinking and deployment of a variety of technologies It even makes financial sense to do it! Government policy is decisive in unlocking the potential © OECD/IEA 2012 Global Outlook Chapter 1 © OECD/IEA 2012 Choosing the future energy system To achieve the 2DS, energy-related C02 emissions must be halved until 2050. © OECD/IEA 2012 Decoupling energy use from economic activity Reducing the energy intensity of the economy is vital to achieving the 2DS. © OECD/IEA 2012 All sectors need to contribute The core of a clean energy system is low-carbon electricity that diffuses into all end-use sectors. © OECD/IEA 2012 A portfolio of technologies is needed Technology contributions to reaching the 2DS vs 4DS Energy efficiency is the hidden fuel that increases energy security and mitigates climate change. © OECD/IEA 2012 A portfolio of technologies is needed Technology contributions to reaching the 2DS vs 4DS Nuclear 8% Power generation efficiency and fuel switching 3% CCS 20% End-use fuel switching 9% End-use fuel and electricity efficiency 31% Renewables 29% Energy efficiency is the hidden fuel that increases energy security and mitigates climate change. © OECD/IEA 2012 All technologies have roles to play Technology contributions to reaching the 2DS vs 6DS 60 Power generation efficiency and fuel switching 3% (1%) 50 Nuclear 8% (8%) Gt CO2 40 End-use fuel switching 12% (12%) 30 End-use fuel and electricity efficiency 42% (39%) Renewables 21% (23%) 20 CCS 14% (17%) 10 0 2009 2020 2030 2040 2050 Nuclear is one piece of the puzzle © © OECD/IEA OECD/IEA 2012 2012 The cost of emitting a tonne of CO2 Marginal abatement cost curve in electricity generation in 2050 Marginal abatement costs reach USD 150 in 2050 and increase rapidly as reductions get deeper. © OECD/IEA 2012 Marginal abatement costs change over time Passenger LDV marginal abatement cost curves in 2DS The marginal abatement costs decrease as learning improves over time. © OECD/IEA 2012 Learning needs to deliver cost reductions Passenger LDV marginal abatement cost curves in 2DS in 2050 under different assumptions on learning Future marginal abatement cost curves are very sensitive to input assumptions © OECD/IEA 2012 Tracking Clean Energy Progress Chapter 2 © OECD/IEA 2012 Near term action necessary in all sectors Global CO2 emissions under ETP 2012 scenarios © OECD/IEA 2012 Clean energy: slow lane to fast track Cleaner coal power Nuclear power Renewable power CCS in power CCS in industry Industry Buildings Progress is too slow in almost all technology areas Significant action is required to get back on track Fuel economy Electric vehicles Biofuels for transport © OECD/IEA 2012 Fossil fuels continued to dominate Changes in sources of electricity supply, 2000-09 Coal remains the largest source of electricity supply, and met about half of additional electricity demand over the last decade. © OECD/IEA 2012 Renewables provide good news Global renewable power generation 42% 75% 27% Average annual growth in Solar PV Cost reductions in Solar PV in just three years in some countries Average annual growth in wind © OECD/IEA 2012 Fuel economy has improved Vehicle fuel economy, enacted and proposed standards The number one opportunity over the next decade in the transport sector, but few countries have standards in place. © OECD/IEA 2012 We must translate ambitions into reality Government and manufacturer Electric Vehicle targets © OECD/IEA 2012 Energy intensity must decline further Progress in energy intensity Significant potential for enhanced energy efficiency can be achieved through best available technologies. © OECD/IEA 2012 Key recommendations 1) Level the playing field for clean energy technologies 2) Unlock the potential of energy efficiency 3) Accelerate energy innovation and public research, development & demonstration Help move clean energy from fringe, to main stream markets… © OECD/IEA 2012 Policies to Promote Technology Innovation Chapter 3 © OECD/IEA 2012 Key findings Investment in energy research by IEA governments has been decreasing as a share of total national RD&D budgets, and stands at 4% Patents for renewable energy technology increased fourfold since 2000, but were concentrated in solar PV and wind The maturity, modularity and scalability of PV and onshore wind have enabled them to take off Meanwhile, high capital costs and perceived risks are holding back precommercial technologies like CCS, IGCC and CSP, which appear to be stuck at the demonstration phase Carbon pricing, energy efficiency policy and technology support are the backbone of a least-cost package to achieve 2DS, but the interactions among policies should be managed carefully Optimum combinations of policies should be based on characteristics of comparable technologies that share similar impediments to development, deployment and diffusion © OECD/IEA 2012 Energy RD&D has slipped in priority OECD R&D spending 25 12% 6% 10 4% 5 4 3 2 2% 0 1986 Energy RD&D 1990 1994 1998 2002 2006 2010 South Africa 1982 Russia 1978 Mexico 1974 India 0% China 0 1 Brazil USD billion 15 2008 non-IEA country spending USD billion 8% Share of energy RD&D in total R&D 10% 20 Share of energy RD&D in total R&D © OECD/IEA 2012 Energy RD&D has slipped in priority OECD R&D spending 25 12% 6% 10 4% 5 4 3 2 2% 1986 1990 1994 1998 2002 2006 2010 Energy efficiency Fossil fuels Renewable energy Nuclear Hydrogen and fuel cells Other power and storage technologies Other cross cutting technologies/research Share of energy RD&D in total R&D South Africa 1982 Russia 1978 Mexico 1974 India 0 0% China 0 1 Brazil USD billion 15 2008 non-IEA country spending USD billion 8% Share of energy RD&D in total R&D 10% 20 © OECD/IEA 2012 Energy RD&D has slipped in priority OECD R&D spending 50% Defence 40% Health and environment General university funds Non-oriented research Space programmes Energy 30% 20% 10% 0% 1981 1985 1990 1995 2000 2005 2010 The IEA has called for a twofold to fivefold increase in annual public RD&D spending on low carbon technologies to achieve the 2DS. © OECD/IEA 2012 Clean energy patents have increased sharply since 2000, driven by solar PV and wind The US, Japan and Germany are the top three inventor countries for most technologies, but China has been catching up. © OECD/IEA 2012 Building from national leadership to promote low-carbon innovation Develop a national energy strategy with clear priorities Increase R&D funding Create mechanisms to fund capital-intensive demonstration Design policies to support early deployment and drive private investment Expand international collaboration © OECD/IEA 2012 There is a wide selection of technology-push and market-pull policy instruments The use of multiple, integrated instruments may be justified to develop and deploy new and improved technologies. © OECD/IEA 2012 The core policy mix Carbon price, energy efficiency policy and technology support are the backbone of a least-cost package to achieve 2DS. © OECD/IEA 2012 Emission trading systems need to take into account the impact of supplementary policy Over- or under-delivery of supplementary policy targets can lead to significant swings in demand for allowances, and hence greater uncertainty in carbon prices. © OECD/IEA 2012 Early support for new technologies can lower their cost But technology learning is not a justification for any level of early support. © OECD/IEA 2012 New technologies take time to scale up Time, as well as cost, is a relevant factor in the justification for early support of emerging technologies. © OECD/IEA 2012 Optimum combination of policies can accelerate clean energy uptake Note: The darker the colour, the greater the challenge for the related policy measures Policy measures can be tailored to specific categories of technologies, according to the challenge they aim to address. © OECD/IEA 2012 An energy innovation policy framework Government should create an environment in which clean energy innovation can thrive and within which policies are regularly evaluated to ensure that they are effective and efficient. © OECD/IEA 2012 Financing the Clean Energy Revolution Chapter 4 © OECD/IEA 2012 Clean energy investment pays off Additional investment Additional investment Power Industry Transport Fuel savings Residential Total savings Commercial Undiscounted Fuel savings Biomass Coal 10% Oil - 120 - 80 - 40 0 40 USD trillion Gas Every additional dollar invested in clean energy can generate 3 dollars in return. © OECD/IEA 2012 Clean energy investment pays off USD trillion Every additional dollar invested in clean energy can generate 3 dollars in return. © OECD/IEA 2012 Investment needs to 2020 Additional investments in the 2DS, compared to 6DS Investments in buildings sector dominates in all countries, highlighting importance of energy efficiency © OECD/IEA 2012 Additional investment needs in 2DS Additional Investments in transport dominate between 2020 and 2050 © OECD/IEA 2012 Annual additional investments in 2DS Additional investments in non-OECD countries exceed the pledged climate finance, but the incremental cost is much less due to fuel savings © OECD/IEA 2012 Power generation: Additional investments in 2DS Renewable energy sources dominate investments in power generation in the 2DS. © OECD/IEA 2012 Power generation: annual investments 2DS In the 2DS, investments in coal-fired plants do not decline significantly until after 2020. © OECD/IEA 2012 Transport : Additional investments . The cost of decarbonising the transport sector accelerates after 2030 as greater investments are made in advanced vehicles and low-carbon options in air, shipping and rail. © OECD/IEA 2012 Buildings: Average annual investments In the 2DS, higher investments will be needed for more efficient HVAC systems and building shell improvements. © OECD/IEA 2012 Industry: Total investments to 2050 Investments needed in the 2DS are moderately higher than in the 6DS © OECD/IEA 2012 Clean energy investment pays off Total savings Fuel savings Additional investment Additional investment Power Power Industry With price effect Transport Industry Without price effect Residential Transport Commercial Undiscounted Fuel savings Residential 3% Biomass Coal Commercial 10% Oil - 160 - 120 - 80 - 40 0 40 Gas USD trillion Every additional dollar invested in clean energy can generate 3 dollars in return. © OECD/IEA 2012 Clean energy investment pays off Additional investment Additional investment Power Industry Transport Fuel savings Residential Total savings Commercial Undiscounted Fuel savings Biomass 10% Coal Oil - 120 - 80 - 40 USD trillion 0 40 Gas Every additional dollar invested in clean energy can generate 3 dollars in return. © OECD/IEA 2012 Conclusions Investment in low carbon technologies need to double current levels by 2020, reaching USD 500 bn annually Balance between ensuring investors confidence and controlling total policy costs Need for coordination on energy, climate and investment policies Uncertainty in national regulatory policies and support frameworks remains key obstacle to finance Greater dialogue needed between governments and investors What can be done to incentives a move towards sustainable long term investments? © OECD/IEA 2012 Energy Systems Thinking © OECD/IEA 2012 A smart, sustainable energy system Co-generation Renewable energy resources Centralised fuel production, power and storage Distributed energy resources Smart energy system control H2 vehicle Surplus heat EV A sustainable energy system is a smarter, more unified and integrated energy system © OECD/IEA 2012 The Global Energy system today Dominated by fossil fuels in all sectors © OECD/IEA 2012 The future low-carbon energy system The 2DS in 2050 shows a dramatic shift in energy sources and demands © OECD/IEA 2012 Heating and Cooling Chapter 5 © OECD/IEA 2012 Heating & Cooling: huge potential Renewable heat Integration with electricity District heating and cooling network Co-generation Surplus heat Heating and cooling account for 46% of global energy use. Their huge potential for cutting CO2 emissions is often neglected. © OECD/IEA 2012 Decarbonising heating and cooling: neglected but necessary Total final energy consumption by region as electricity, heat, transport and non-energy uses, 2009 Heating and cooling account for 46% of final energy consumption worldwide. © OECD/IEA 2012 Decarbonising the existing buildings stock In OECD countries, more than two-thirds of existing older buildings will still be standing in 2050. However, in non-OECD countries, an estimated 52% to 64% of the building stock that will exist by 2050 has not yet been built © OECD/IEA 2012 Large quantities of heat losses can be recuperated Heat loss in power generation by region, 2009 More then 50% of energy input of thermal power plants is wasted in cooling towers and rivers. © OECD/IEA 2012 District energy networks can reduce CO2 intensity Biomass and a mix of other renewable energy sources make up almost threequarters of primary energy consumption in 2050. © OECD/IEA 2012 Heat pumps offer great potential under the right conditions Electricity load curve in the high-penetration base and smart case studies Poor installations can increase the costs of decarbonising electricity networks… …but smart control coupled with storage could minimise their possible impacts. © OECD/IEA 2012 Heat pumps and co-generation are not conflicting technologies Integrating heat within the energy system can lower costs and help decarbonisation in other sectors © OECD/IEA 2012 Flexible Electricity Systems Chapter 6 © OECD/IEA 2012 Global Electrical Energy Generation Lower electrical energy demand in 2DS even though electricity is larger proportion of overall energy demand. © OECD/IEA 2012 Electricity generation capacity Generation capacity is higher in the 2DS due to great deployment of variable renewables with lower capacity factors. © OECD/IEA 2012 Electricity system flexibility Power system flexibility expresses the extent to which a power system can modify electricity production or consumption in response to variability, expected or otherwise. ± MW / time © OECD/IEA 2012 Flexibility needs and resources Existing and new flexibility needs can be met by a range of resources in the electricity system – facilitated by power system markets, operation and hardware. © OECD/IEA 2012 No “one-time” fits all Balancing of the electricity system needs to address several time frames for response and duration, impacting choice of technology. © OECD/IEA 2012 GW The need for flexibility is increasing All regions under all scenarios show an increasing need for electricity system flexibility. © OECD/IEA 2012 Flexibility from power generation Start-up time [hours] Ramp rate [% per min] Time from 0 to full rate [hour] Minimum stable load factor [%] 0 10 20 30 0 50 100 0 10 20 0 20 40 0 10 20 30 0 50 100 0 10 20 0 20 40 Nuclear Hydro Coal (conventional) OCGT CCGT All generation technologies have the technical ability to provide some flexibility. © OECD/IEA 2012 Flexibility from power generation Ancillary Yes services provided? Possible CCGT Co-generation Large Micro > 100 MW 1 - 100 MW 1 - 5 kW Frequency limited Reserve possible Diesel and CCGT standby Bio-energy <50 MW 1 - 100 MW Wind PVs < 100kW if high penetration Reactive Network support if high penetration Grid support from distributed generation should be enabled. © OECD/IEA 2012 Two very different profiles for natural gas use in power generation Power generation from natural gas increases to 2030 in the 2DS and the 4DS. From 2030 to 2050, generation differs markedly. Natural gas-fired power generation must decrease after 2030 to meet the CO2 emissions projected in the 2DS scenario. Notes: Natural gas-fired power generation includes generation in power plants equipped with CCS units. Biogas is not included here. © OECD/IEA 2012 Mode of operation of natural gas plants differs according to scenario Gas increasingly provides base load in the 4DS and peak load in the 2DS The lowering of the capacity factor threatens the viability of existing plants and detracts from investment in new plants. © OECD/IEA 2012 The demand side flexibility resource is large and under utilised All regions exhibit a significant demand side flexibility resource – especially for regulation and load following. © OECD/IEA 2012 North American sectoral resource Demand-side energy efficiency decreases resource. © OECD/IEA 2012 Storage – a game changer or niche player? Existing installations and niche applications will play a definite role in the future, but cost concerns exist for new deployments. © OECD/IEA 2012 Storage technology cost vary widely Application specific deployment is key for successful business case development. © OECD/IEA 2012 Methodology – T&D analysis 3 drivers in grid development Grid extension Grid renewal Renewable integration Data sources: power sector: IEA statistics and ETP 2012 scenarios T&D grid length and age: ABS Energy Research © OECD/IEA 2012 T&D infrastructure investments in the 4DS and 2DS are similar ...but sectoral allocation differs © OECD/IEA 2012 2DS offers new challenges and opportunities for T&D systems Cumulative costs and benefits of smart grids versus conventional T&D systems in the 2DS to 2050 Smart-grids’ costs are substantial, but estimated benefits do exceed investment. © OECD/IEA 2012 Methodology – Smart grids Long-run incremental social costs and benefits compared to a conventional T&D grid Costs - bottom up approach Technology costs are calculated by multiplying units required, market penetration, and unit cost component replacement at the end of its technical lifetime. Data: EPRI, IEE, CER, expert interview Benefits CO2 savings, capital cost savings, extended lifetime, increased reliability, reduced operational cost. Methodology from: IEA, EPRI © OECD/IEA 2012 Smart grid benefits exceed costs by a factor of between 1.5 and 4.5 ..., but direct benefits of investment in one sector may be found in other sectors. © OECD/IEA 2012 Technology choices in electricity system flexibility © OECD/IEA 2012 What do we need to do? Barriers? Use systems based approaches – utilise flexibility resources from all parts of the electricity system Learn by doing - increased pilot and demonstration projects will enable of real-world solutions for flexibility Support new technology deployment – develop regulatory and market solutions that allow new technologies and new actors to support system operation Determine regulatory approaches that support conventional and new technologies – and adequately share costs, benefits and risks. © OECD/IEA 2012 Hydrogen Chapter 7 © OECD/IEA 2012 H2 is a flexible energy carrier H2 is one of only a few near-zero-emissions energy carriers (along with electricity and bio-fuels) with potential applications across all end-use sectors. © OECD/IEA 2012 Energy storage in H2 Source: NREL 2009 H2 storage may be cost competitive in the future. © OECD/IEA 2012 FCEV are still expensive H2 could be used in fuel-cell vehicles such as longer range cars and trucks. © OECD/IEA 2012 Decarbonisation of road transport saves money Investment in H2 technology decreases savings but opens the way towards sustainability. © OECD/IEA 2012 A pathway for H2 infrastructure rollout Optimisation of centralised and decentralised H2 production is one of the major challenges. © OECD/IEA 2012 H2 T&D infrastructure investments H2 infrastructure to serve a fleet of 500 million FCEVs by 2050 would cost, which equals roughly 1% of total spending in vehicles and fuels. © OECD/IEA 2012 Post 2050: H2 an alternative to bioenergy Post 2050, hydrogen could become an important energy carrier in a clean energy system, especially if bioenergy resources are limited. © OECD/IEA 2012 The Future of Fossil Fuels © OECD/IEA 2012 Primary energy demand (EJ) Fossil fuels dominate energy demand … Demand for coal over the last 10 years has been growing much faster than for any other energy sources. © OECD/IEA 2012 Non-hydro renewables Hydro Nuclear Share of electricity (%) Electricity generation (TWh) Non-fossil power generation Despite an increasing contribution across two decades, the share of non-fossil generation has failed to keep pace with the growth in generation from fossil fuels. © OECD/IEA 2012 Coal Technologies Chapter 8 © OECD/IEA 2012 Key findings Coal demand and generation of electricity from coal both need to fall by more than 40% to meet the 2DS. Substantial numbers of old, inefficient coal power plants remain in operation. The increasing use of widely available, low-cost, poor-quality coal is a cause for concern. Supercritical technology, at a minimum, should be deployed on all combustion installations. Research, development and demonstration of advanced technologies should be actively promoted. To achieve deeper cuts, CCS offers the potential to reduce CO2 emissions to less than 100 g/kWh. It is important to reduce local pollution for coal. © OECD/IEA 2012 Coal reserve (Gt) Coal is abundant and widely available Brown coal Hard coal Sufficient coal reserves exist for an estimated 150 years of generation at current consumption rates. © OECD/IEA 2012 Reducing emissions from coal is critical Reducing non-GHG emissions is also important to maintain or improve air quality locally. © OECD/IEA 2012 Electricity generation from coal (TWh) Policy and regulation play a major role Policy and Regulation Coal Coal with CCS Electricity reduction in the 2DS Encourage reduction of generation from inefficient plants and switching from coal to gas, renewables and nuclear. © OECD/IEA 2012 CO2 intensity must also be reduced 2010 CO2 emissions (Gt) Technology development 2050(4DS) 2050(2DS) Policy and regulation Electricity (TWh) Technology development coupled with targeted policies and regulation are essential to realise the 2DS target in 2050. © OECD/IEA 2012 Couple efficient plant with CCS Raising plant efficiency: reduces emissions of CO2, and reduces the cost of CCS. CO2 intensity (gCO2/kWh) Subcritical Supercritical Ultra-supercritical Advanced-USC 90% With CCS Efficiency (LHV, net) If CCS is applied to an average subcritical plant, its efficiency would drop by one-third. © OECD/IEA 2012 Capacity (GW) Adoption of best practice technology is needed to raise average efficiency Potential for capacity growth in coal-fired power generation is seen mostly in non-OECD countries such as China and India. © OECD/IEA 2012 Global electricity generation from coal (TWh) Reducing CO2 emissions 1. Subcritical 3. Plants with CCS 2. USC 2. Supercritical 1. Reduce generation from least efficient plant 2. Increase capacity of more efficient plant 3. Deploy CCS © OECD/IEA 2012 Carbon lock-in must be avoided To meet the 2DS, generation from subcritical plants would cease before end of their natural lifetimes. Capacity (GW) Including construction plans up to 2015 Existing plants built before 2000 Generation from subcritical units should be reduced; future capacity additions should be supercritical or better. © OECD/IEA 2012 Development of advanced technology is essential Steam temperature (°C ) Advanced USC 700oC Demonstrations are being planned from 2020 - 2025 Ultra-supercritical Supercritical Subcritical Ultra-supercritical plants are currently operated in various countries including China. © OECD/IEA 2012 Opportunities and recommendations Technologies to address the environmental impacts of sharply increased coal use must be used. Increasing the average efficiency of global coal-fired power generation plants will be essential over the next 10 to 15 years: Deploy supercritical and ultra-supercritical technologies Minimise generation from older, less efficient coal plants Accelerate development of advanced technology. CCS must be developed and demonstrated rapidly if it is to be deployed widely after 2020. Finally, there must be a shift away from reliance on coal. In a truly low-carbon future, coal will not be the dominant energy source. Strong policies will be essential if these goals are to be met. © OECD/IEA 2012 Natural Gas Technologies Chapter 9 © OECD/IEA 2012 Key findings Increasing production of unconventional gas leads to an improvement in energy security in many regions. Continuous technology improvement at each stage of unconventional gas exploration and production is essential In the 2DS: • Natural gas will retain an important role in the power, buildings and industry sectors to 2050. • The share of natural gas in total primary energy demand declines more slowly – and later (after 2030) – than other fossil fuels. • Natural gas acts as a transitional fuel towards a lowcarbon energy system. © OECD/IEA 2012 Unconventional gas rises in importance The share of unconventional gas of total gas supply continues to increase in both 4DS and 2DS. © OECD/IEA 2012 Continuous technology improvement is essential Continuous technology improvement at each stage of exploration and production goes hand in hand with reducing the environmental impact of those processes. © OECD/IEA 2012 Maturity of technology and experience can differ widely Technology needs and solutions should be adapted according to experience and geographical location. © OECD/IEA 2012 Natural gas is the second-largest source of primary energy in 2050 Although the share of fossil fuels in total primary energy production declines by 2050, the share of natural gas declines least. © OECD/IEA 2012 Power sector is the dominant consumer of natural gas Note: For power, including co-generation, and for commercial heat, gas contribution represents gas input to the plants To achieve the 2DS, natural gas consumption needs to be reduced strongest in the power sector. © OECD/IEA 2012 Two very different profiles for natural gas use in power generation Note: Natural gas-fired generation includes generation in power plants equipped with CCS units. Biogas is not included. Natural gas-fired power generation must decrease after 2030 to meet the CO2 emissions projected in the 2DS. © OECD/IEA 2012 Natural gas as a transitional fuel Power generation from natural gas increases to 2030 in the 2DS and the 4DS. From 2030 to 2050, generation differs markedly. TWh 10 000 4DS 4DS 10 000 7 500 7 500 5 000 5 000 2 500 2 500 0 2009 2020 2030 2040 OECD 2050 2DS 2DS 0 2009 2020 2030 Non-OECD 2040 2050 Natural gas-fired power generation must decrease after 2030 to meet the CO2 emissions projected in the 2DS scenario. © OECD/IEA 2012 Mode of operation of natural gas plants differs according to scenario Gas increasingly provides base load in the 4DS and peak load in the 2DS. Note: Generation from gas-fired plants equipped with CCS is not included The lowering of the capacity factor threatens the viability of existing plants and detracts from investment in new plants. © OECD/IEA 2012 Natural gas becomes a ‘high-carbon fuel’ after 2025 CCGTs are the most efficient natural gas-fired power generation plants, with a CO2 intensity almost half that of the best coalfired plant. The global average CO2 intensity from natural gas-fired power generation falls below the carbon intensity of CCGTs in 2025. © OECD/IEA 2012 Gas technologies in the power sector are essential to achieve the 2DS Continuous technology improvement will be necessary to achieve efficiency increases and to reduce the cost of CCS. © OECD/IEA 2012 Efficiency improvement plays an important role State-of-the-art CCGT has reached 60% efficiency, while some emerging technologies have the potential to reach 70%. Whether open-cycle or combined-cycle, larger capacity plants are generally capable of achieving higher efficiencies. © OECD/IEA 2012 Gas-fired power generation complements variable renewables Both OCGT and CCGT are sufficiently flexible in their responses to meet unexpected variations in demand. OCGTs are less costly and have a smaller footprint, but are much less efficient than CCGTs. © OECD/IEA 2012 Biogas and CCS are essential components of a low-carbon future In the 2DS, 40% of the electricity generated from gas comes from natural gas with CCS and biogas. © OECD/IEA 2012 Opportunities and recommendations Regulation to mitigate the potential for environmental risks associated with production of unconventional gas must be introduced. Gas-fired technologies to provide flexibility for power generation will be essential over the short term. Over the next ten years, gas will displace significant coalfired power generation – though it should be noted, natural gas-fired generation will itself need to be displaced in the longer term to decarbonise the power sector still further. First-generation, large-scale gas plants with CCS need to be demonstrated and deployed. © OECD/IEA 2012 Carbon Capture and Storage Technologies Chapter 10 © OECD/IEA 2012 Emissions (GtCO2) The technology portfolio includes CCS 20% 29% 8% Carbon capture and storage (CCS) contributes one-fifth of total emissions reductions through 2050 © OECD/IEA 2012 CO2 Captured (GtCO2) CCS must grow rapidly around the globe In the near term, the largest amount of CO2 is captured in OECD countries; by 2050, CO2 capture in non-OECD countries dominates © OECD/IEA 2012 CCS is applied in power and industry Note: Capture rates shown in MtCO2/year The majority of CO2 is captured from power generation globally, but in some regions CO2 captured from industrial applications dominates © OECD/IEA 2012 CCS in power generation Photo: Vattenfall © OECD/IEA 2012 Three CO2 capture routes in power Post-combustion CO2 capture • Fossil fuel or biomass is burnt normally and CO2 is separated from the exhaust gas Pre-combustion CO2 capture • Fossil fuel or biomass is converted to a mixture of hydrogen and CO2, from which the CO2 is separated and hydrogen used for fuel Oxy-combustion CO2 capture • Oxygen is separated from air, and fossil fuels or biomass are then burnt in an atmosphere of oxygen producing only CO2 and water At the present time, none of the options is superior; each has particular characteristics making it suitable in different power generation applications © OECD/IEA 2012 Three CO2 capture routes in power At the present time, no one route is clearly superior to another; each has particular characteristics that make it suitable in different cases of power generation fuelled by coal, oil, natural gas and biomass. © OECD/IEA 2012 Electric power Capture technologies are ready Precombustion Postcombustion Oxycombustion Gas Concept. Pilot Pilot Concept. (CLC) Coal Pilot Pilot Pilot Concept. (CLC) Concept. Concept. Concept. Biomass Industrial applications Fuel processing Pilot Inherent Pilot Iron and steel Pilot Biomass conversion Pilot Other Pilot Demo Cement manufacture Pilot High-purity sources Pliot Pilot (Hisarna, Ulcored) Demo (FINEX) Commercial (DRI, COREX) Commercial Concept. (Carbonate looping) Pilot Commercial Numerous routes to CO2 capture are in pilot-testing or demonstration stages for power and industrial applications; some are commercially available today © OECD/IEA 2012 No one technology is a clear winner, yet… Coal Capture route Natural gas Post-combustion Pre-combustion Oxy-combustion Post-combustion Reference plant without capture PC IGCC PC NGCC Net efficiency with capture (LHV, %) 30.9 33.1 31.9 48.4 Net efficiency penalty (LHV, percentage points) 10.5 7.5 9.6 8.3 Relative net efficiency penalty 25% 20% 23% 15% 3 808 3 714 3 959 1 715 Relative overnight cost increase 75% 44% 74% 82% LCOE with capture (USD/MWh) 107 104 102 102 63% 39% 64% 33% 58 43 52 80 Overnight cost with capture (USD/kW) Relative LCOE increase Cost of CO2 avoided (USD/tCO2) Applying CCS to a power plant will likely increase the LCOE by one- to two-thirds depending on the type of plant, relative to a similar power plant without CCS © OECD/IEA 2012 CCS is expected to be cost-competitive © OECD/IEA 2012 CCS is applied to coal, gas and biomass In 2050, 63% of coal-fired electricity generation (630 GW) is CCS equipped, 18% of gas (280 GW) and 9% of biomass (50 GW) © OECD/IEA 2012 Generation from CCS equipped plants grows Power plants with CCS produce 15% of electricity in 2050, while fossil-fueled plants without CCS produce only 10% © OECD/IEA 2012 Natural gas is not a panacea The global average CO2 intensity from power generation falls below the carbon intensity of CCGTs in 2025 in the 2DS; CCS can play a role in reducing emissions from gas © OECD/IEA 2012 Generation capacity (GW) CCS is deployed globally for power In OECD North America, almost all coal-fired and 36% of gas-fired generation is CCS equipped; nearly two-thirds of coal-fired generation in China is equipped with CCS © OECD/IEA 2012 Retrofitting CCS to coal-fired generation The more than 1 600 GW of installed coal-fired generation emitted almost 9 GtCO2 in 2010; more than 350 GW were added in the past five years. In most general terms, larger, more efficient (i.e. younger) plants are suitable for retrofit: today, 471 GW of coal-fired plants are larger than 300 MW and younger than 10 years In the 2DS, 150 GW of supercritical and ultrasupercritical capacity are retired because they are uneconomic for retrofit due, and 100 GW of coal are retrofitted with CCS © OECD/IEA 2012 Retrofitting CCS to coal-fired generation In the 2DS, through 2050: In most general terms, larger, more efficient (i.e. younger) plants are suitable for retrofit Source: IEA, 2012 700 GW of subcritical capacity is retired 150 GW of uneconomic supercritical and ultrasupercritical are retired 100 GW of coal are retrofitted with CCS © OECD/IEA 2012 CCS in industrial applications Photo: BP © OECD/IEA 2012 Industrial applications of CCS Some industrial processes produce highly concentrated CO2 vent streams; capture from these “high-purity” sources is relatively straightforward Other industrial applications require additional CO2 separation technologies to concentrate dilute streams of CO2 The same CO2 separation technologies applied in power generation can be applied to industrial sources Industrial processes suited to CCS Dilute exhaust streams Concentrated vent streams e.g. blast furnaces and cement kilns e.g. gas processing, NH3 and ethanol production Post-combustion Oxy-Combustion Pre-combustion © OECD/IEA 2012 Cost of CCS in industry varies widely A wide range of abatement costs through CCS exists in industrial applications © OECD/IEA 2012 CO2 Captured (GtCO2/y) Industrial applications play an important role Non-OECD countries account for 72% of cumulative CO2 captured from industrial applications of CCS between 2015 and 2050 – China alone accounts for 21% of the global total © OECD/IEA 2012 Industrial applications vary by region Note: Capture rates shown in MtCO2/year The predominant industrial application of CCS will vary by region and over time © OECD/IEA 2012 Negative emissions from BECCS Bio-energy with carbon capture and storage (BECCS) can result in permanent net removal of CO2 from the atmosphere, i.e. “negative CO2 emissions” In BECCS, energy is provided by biomass, which removed atmospheric carbon while it was growing, and the CO2 emissions from its use are captured and stored through CCS BECCS can be applied to a wide range of biomass conversion processes and may be attractive costeffective in many cases Biomass must be grown and harvested sustainably, as this significantly impacts the level of emissions reductions that can be achieved © OECD/IEA 2012 Where is CO2 storage needed? Note: Mass captured shown in GtCO2 Between 2015 and 2050, 123 Gt of CO2 are captured that need to be transported to suitable sites and stored safely and effectively. Storage sites will need to be developed all around the world. © OECD/IEA 2012 Total investment for CCS: 3.6 trillion USD © OECD/IEA 2012 Transport and storage challenges Storage Fundamental physical processes and engineering aspects of geologic storage are well understood Suitable geologic formations must have sufficient capacity and injectivity, and prevent CO2 (and brine) from reaching the atmosphere, sources of potable groundwater and other sensitive regions in the subsurface Storage assessments suggest that the available global pore space resource is sufficient to store 123 GtCO2 Storage cost of storage is highly variable: US cost estimates for onshore saline aquifers range from less than USD 1/tCO2 to over USD 20/t of CO2 stored Transport Most straightforward and well-known step in the CCS chain Pipeline and ship (or barge) are the only practical options at scale In 2010, over 60 MtCO2 were transported through a 6 600 km pipeline network in the United States Cost of transport is generally low, but is a function of distance, capacity, and terrain Transport by ship or barge is generally more expensive than by pipeline over short distances © OECD/IEA 2012 Recommended actions for the near term The gap between the current trajectory for CCS and the 2DS can be bridged, but concerted policy action is necessary from both industry and all levels of government 1. 2. Government must assess the role of CCS in their energy futures, develop suitable deployment strategies for CCS and a clear timeline to develop enabling regulations Government and industry must redouble efforts to demonstrate CCS at a commercial scale in different locations and technical configurations—including large-scale CO2 storage projects © OECD/IEA 2012 Recommended actions for the near term 3. 4. 5. 6. 7. Government must implement appropriate and transparent incentives to drive CCS deployment; long-term climate change mitigation commitments and policy actions are necessary Government must develop enabling legal and regulatory frameworks for demonstration and deployment of CCS, so that lack of regulation does not unnecessarily impede or slow deployment Government and industry must develop clear, accurate information on the geographic distribution of storage capacity and associated costs for storing CO2 Government and industry increase emphasis on CO2 transport and storage infrastructure development so that integrated CCS projects can be successful All parties must engage the public at both policy and project levels. A lack of transparency and a two-way flow of information from early stages can be fatal for CCS. © OECD/IEA 2012 Electricity Generation and Fuel Transformation Chapter 11 © OECD/IEA 2012 Energy and CO2 impacts of electricity generation Other transformation Agriculture 2% 6% Other transformation Agriculture 5% 2% Buildings 9% Buildings 15% Transport 18% Power 38% Industry 21% Total primary energy use: 509 EJ in 2009 Transport 20% Power 38% Industry 26% Total energy-related CO2 emissions: 31.4 Gt in 2009 Power sector accounted in 2009 for almost 40% of global primary energy use and energy-related CO2 emissions. © OECD/IEA 2012 Past trends in power generation Global electricity generation by fuel Incremental generation 1990-2009 4 000 non-OECD OECD 3 500 3 000 TWh 2 500 2 000 1 500 1 000 500 0 Coal Gas Renewables Increase in electricity generation over the last two decades largely covered by fossil fuels, but strong growth rates for renewables . Nuclear © OECD/IEA 2012 Age distribution of existing power plants Ageing infrastructure is the challenge in many OECD countries, whereas emerging economies have to cope with a growing demand for electricity. © OECD/IEA 2012 Carbon lock-in must be avoided Capacity (GW) Including construction plans up to 2015 Existing plants built before 2000 To meet the 2DS, generation from subcritical plants would need to cease before end of their technical lifetimes. © OECD/IEA 2012 Electricity demand Liquid fuel demand is stabilised at today’s level in 2050 in the 2DS, largely due to efficiency improvements and electrification in the transport sector. © OECD/IEA 2012 Electricity demand Incremental final electricity demand between 2009-2050 in the 2DS Strong growth in electricity demand in emerging economies across all sectors, whereas in OECD countries consumption is driven by electrification of the transport and buildings sector. © OECD/IEA 2012 Low-carbon electricity: a clean core Global electricity generation in the 2DS 45 000 Other Wind Solar Hydro Nuclear Biomass and waste Oil Gas with CCS Gas Coal with CCS Coal 40 000 TWh 35 000 30 000 25 000 20 000 15 000 10 000 5 000 0 2009 2020 2030 2040 2050 Renewables will generate more than half the world’s electricity in 2050 in the 2DS © OECD/IEA 2012 Electricity generation scenarios 4DS 100% 19% 80% 36% 13% 60% 12% 3% 40% 67% Renewables Nuclear Fossil w CCS Fossil w/o CCS 49% 20% 0% 2009 2050 100% 2DS 19% 80% 13% 57% 67% 19% 60% 40% 20% Renewables Nuclear Fossil w CCS Fossil w/o CCS 14% 9% 0% 2009 2050 In the 2DS, global electricity supply becomes decarbonised by 2050. © OECD/IEA 2012 Power generation; Nuclear Global installed capacity Without further action, nuclear deployment in 2025 will be below levels in the 2DS, although a majority of key countries remain committed to nuclear. © © OECD/IEA OECD/IEA 2012 2012 Average annual capacity additions Hydro Nuclear CSP 2030-50 PV 2020-30 Wind, offshore 2010-20 Wind, onshore 2006-10 Biomass Gas with CCS Coal with CCS 0 20 40 60 GW per year 80 100 120 Massive acceleration of deployment of low-carbon power technologies is needed over the next four decades. © OECD/IEA 2012 All technologies have roles to play Electricity demand savings and renewables are each responsible for one-third of the cumulative CO2 reductions in the power sector in the 2DS. © OECD/IEA 2012 All technologies have roles to play Technology contributions to reaching the 2DS 60 Power generation efficiency and fuel switching 3% (1%) 50 Nuclear 8% (8%) Gt CO2 40 End-use fuel switching 12% (12%) 30 End-use fuel and electricity efficiency 42% (39%) Renewables 21% (23%) 20 CCS 14% (17%) 10 0 2009 2020 2030 2040 2050 Nuclear is one piece of the puzzle © © OECD/IEA OECD/IEA 2012 2012 All technologies have roles to play 600 550 Gt CO2 500 450 400 350 300 4DS Electricity Fuel switching Nuclear 14% savings 28% and efficiency 5% CCS 18% Wind 14% Solar 12% Other renewables 9% Electricity demand savings and renewables are each responsible for one-third of the cumulative CO2 reductions in the power sector in the 2DS. 2DS © OECD/IEA 2012 Key technologies to reduce CO2 in the power sector Wind 13% Geothermal Ocean 0.4% 1% Solar 11% Electricity savings 38% Biomass 4% Cumulative reductions in the power sector of 474 Gt between 2009 and 2050 in the 2DS (relative to the 6DS) Hydro 4% Nuclear 13% CCS 12% Fuel switching and efficiency 4% Renewables provide more than one third of the cumulative reductions needed to decarbonise electricity supply in the 2DS. © OECD/IEA 2012 Electricity generation mix 100% 80% 13% 9% 19% 24% 12% 11% 19% 25% 34% Nuclear 36% 60% 3% 63% 40% 67% Renewables 71% 57% 49% Fossil w/ CCS Fossil w/o CCS 68% 49% 20% 14% 7% 13% 9% 0% 6DS 4DS 2DS 2009 12% 2DS-NoCCS 2DS-hiRen 7% 10% 2DS-HiNuc 2050 USD trillion 0 -5 -10 Cumulative additional costs rel. to 6DS -15 -20 -25 -30 4DS 2DS 2DS-NoCCS 2DS-hiRen 2DS-HiNuc Other technology portfolios reach the same reduction as in the 2DS, but, with the exception of the 2DS-hiNuc variant, at higher costs. © OECD/IEA 2012 There are many routes to decarbonisation Regional electricity mixes in the 2DS in 2050 US 4% 24% South Africa 2% Russia 23% 5% India 19% 10% 8% 7% 13% 21% 1% 10% Fossil w/o CCS 14% 20% 30% Fossil w CCS 14% 16% 6% 18% 10% 50% Hydro 6% 60% Solar 15% 7% 9% 19% 10% 70% Wind 7% 18% 6% Nuclear 15% 29% 14% 40% 17% 21% 10% 5% 6% 19% 60% 25% 12% 16% 21% 24% Brazil 2% 0% 5% 0% 7% 17% 22% 18% 28% 28% 14% EU 2% 6% 15% 2% 28% 20% ASEAN 6% 24% 8% Mexico China 22% 22% 80% 90% 100% Other renewables Portfolios to decarbonise the power sector depend on regional challenges and opportunities. © OECD/IEA 2012 Renewables: Central to reach the 2DS 60 CCS 22% CCS 22% Nuclear 9% 50 Nuclear 9% Power generation efficiency and fuel switching 3% GtCO2 40 Renewables 28% Power generation efficiency and fuel switching 3% End-use fuel switching 9% Renewables 30 Renewables 28% End-use fuel and electricity efficiency 31% 6DS End-use fuel switching 9% 20 4DS End-use 2DS fuel and electricity efficiency 31% 10 0 2009 2020 2030 2040 2050 Renewables provide almost 30% of the cumulative reductions needed to reach the 2DS. © OECD/IEA 2012 Hydropower is a giant Hydropower generation [TWh] 8 000 7 000 Non-OECD Europe and Eurasia 6 000 Other non-OECD Asia Other Latin America 5 000 China 4 000 Brazil 3 000 Africa and Middle East 2 000 OECD Europe 1 000 OECD Asia Oceania OECD Americas 0 1990 2000 Historic 2010 2020 2030 2040 2050 2DS Hydropower will continue to play a major role in power generation: hydropower generation more than doubles in the 2DS compared to today. © OECD/IEA 2012 Renewable electricity generation ASEAN 56% Brazil 2050 93% 49% China India 50% Mexico 62% Russia 59% South Africa 51% EU 69% US 50% 1 000 0 2 000 3 000 4 000 6 000 5 000 TWh/yr Hydro Solar PV CSP Wind onshore Wind offshore Biomass and waste Geothermal Ocean Renewables become a major part of the electricity system in 2050 in the 2DS in many countries, with the mix depending on local conditions. © OECD/IEA 2012 Total primary energy demand 350 300 2009 250 200 EJ 6DS 2050 150 4DS 2050 100 2DS 2050 50 0 Coal Oil Gas Nuclear Hydro Biomass Other renewables Biomass becomes the largest primary energy carrier by 2050 in the 2DS. © OECD/IEA 2012 Liquid fuel demand and supply 250 Hydrogen Biomethane 200 EJ Biodiesel/Bio-ethanol 150 CTL/GTL Oil 100 Power Buildings, agriculture 50 Transport Industry 0 Demand 2009 Supply Demand Supply 2050, 4DS Demand Supply 2050, 2DS Liquid fuel demand is stabilised at today’s level in 2050 in the 2DS, largely due to efficiency improvements and electrification in the transport sector. © OECD/IEA 2012 g CO2-eq / kWh In the 2DS, electricity becomes a near zero carbon fuel by 2050 1 000 900 800 700 600 500 400 300 200 100 0 2009 World 2030 European Union 2050 4DS United States 2050 2030 China 2DS India ASEAN Carbon intensity drops by 90% by 2050 in the 2DS . © OECD/IEA 2012 Nuclear remains important – and Europe will need to start seriously investing at 2020 40% 35% 1 000 30% GW 800 25% 600 20% 15% 400 10% 200 0 2009 5% 2020 2030 2040 Other OECD share of global electricity generation 1 200 0% 2050 European Union United States Other non-OECD India China 2DS 2DS-hiNuc Capital cost inflation and project management hurdles will make mobilization of investment challenging © OECD/IEA 2012 Renewables need to dominate EU electricity 5 000 100% 4 500 90% 4 000 80% 3 500 70% 2 500 2 000 13% 17% Other renewables Other renewables Other renewables 10% Wind Wind Wind 21% Generation share TWh 3 000 4% 4% 28% 28% 7% 60% Solar Solar Solar 9% 50% 40% 1 500 30% 1 000 20% 500 10% 0 0% 22% Hydro Hydro Hydro 13% Nuclear Nuclear Nuclear 1% 53% 23% Fossil w CCS Fossil w CCS Fossil w CCS 27% 7% 2% 4DS 2009 2009 10% 2009 Fossil Fossil w/ow/o CCS CCS Fossil w/o CCS 4DS 2DS 2DS 2050 2050 2050 Renewables cover two-thirds of the electricity mix in 2050 in the 2DS, with wind power alone reaching a share of 30% in the mix. © OECD/IEA 2012 Industry Chapter 12 © OECD/IEA 2012 Key findings Industry must reduce its direct emissions by 20% if it is to contribute to the global target of halving energy-related emissions by 2050. Efficiency alone will not be sufficient to offset strong growth in materials demand, new technologies are needed. CCS represents the most important new technology option for reducing direct emissions in industry with the potential to save 2.0 to 2.5 GtCO2 in 2050. Reaching the goal of the 2DS requires industry to spend an estimated USD 10.7 to USD 12.5 trillion between 2010 and 2050 © OECD/IEA 2012 GtCO2 Industry must become more efficient 12 6DS 10 Other industries 8 6 Chemicals and petrochemicals Aluminium 4 Pulp and paper 2 Iron and steel 0 2010 Cement 2020 2030 2040 2050 Significant potential for enhanced energy efficiency can be achieved through best available technologies. © OECD/IEA 2012 A substantial shift has been observed in industry Share of industrial energy consumption by region Industries in Asia accounted for 41% of industrial energy consumption in 2009, up from 11% in 1971. © OECD/IEA 2012 Production growth opens up opportunities to improve efficiency Growth in industrial production will be the strongest in non-OECD countries in the 2010 to 2050 period. © OECD/IEA 2012 Decoupling of energy consumption and materials production is achieved in the 2DS Energy consumption in 2050 will be 15% lower in the 2DS than in the 4DS. © OECD/IEA 2012 CO2 emissions need to peak by 2020 to achieve the 2DS emissions target A significant reduction in CO2 emissions in industry is only possible if all sub-sectors contribute. © OECD/IEA 2012 CCS is needed to reduce CO2 emissions Numerous energy efficiency options are already taken into account in the 4DS; as a result, CCS account for about 60% of the reductions between 4DS and 2DS. © OECD/IEA 2012 Key options for industry Iron and steel Cement Chemicals and petrochemicals Pulp and paper Aluminium Application of current best available technologies Including co-generation, efficient motor and steam systems, waste heat recovery and recycling Fuel and feedstock switching DRI, charcoal and waste plastics injection Alternative fuels, clinker substitutes Bio-based chemicals and plastics Increased biomass Smelting reduction Membranes Lignin removal Wetted drained cathodes Electrification New olefin processes Black liquor gasification Inert anodes Hydrogen Other catalytic processes Biomass gasification Carbothermic reduction CCS CCS New technologies CCS CCS © OECD/IEA 2012 Opportunities and recommendations Government intervention is needed to ensure the new facilities and retrofit equipment are reaching BAT level. Government and industry should increase R&D for novel processes and to advance understanding of system approaches. Support is needed for demonstration of capture technologies. Government also need to accelerate development of CO2 transport and storage. Clear, stable, long-term policies that put a price on CO2 are necessary if industry is to implement the technology transition needed. © OECD/IEA 2012 Transport Chapter 13 © OECD/IEA 2012 Recent Trends © OECD/IEA 2012 Transport oil addiction worsening Energy needs are increasing, mainly from modes heavily oil-dependent. © OECD/IEA 2012 World’s mobility habits are diverse Most regions and countries increasingly relying on energy intensive transportation modes. © OECD/IEA 2012 Non-OECD countries key players Non-OECD car sales numbers is set to overtake OECD car sales before 2015; first time since OECD creation. China already the biggest market worldwide. © OECD/IEA 2012 Alternative technologies need dedicated policy package Countries with major share of alternative technologies have specific policies in place promoting those technologies. © OECD/IEA 2012 Looking ahead at 2050 © OECD/IEA 2012 Going back to 2000 CO2 levels in 2050 Pushing technology to its maximum potential is not enough to meet the 2DS target for transport A three-pillar strategy is needed:Void/Shift/Improve © OECD/IEA 2012 Low carbon technologies will be cost competitive Energy costs to go down as utilisation rate are getting higher Low carbon electricity in 2DS the cheapest option on a perkilometre basis © OECD/IEA 2012 Vehicle cost merging by 2050 EV Powertrain cost heavily depending on battery cost evolution Technology improvement and production learning leading to cost competitiveness © OECD/IEA 2012 Electric vehicles need to come of age Passenger LDV sales (million) 200 FCEV Fuel Cell Electric Vehicles Electricity 150 Plug-in hybrid diesel Plug-in hybrid gasoline Diesel hybrid 100 Gasoline hybrid CNG/LPG 50 Diesel 0 2000 Gasoline 2010 2020 2030 2040 2050 More than 90% of light duty vehicles need to be propelled by an electric motor in 2050. © OECD/IEA 2012 What to do in the next decade © OECD/IEA 2012 Tackle Fuel Economy Now! Traditional powertrains biggest saving potential 2020 Target : 5.6 Lge/100km on average worldwide © OECD/IEA 2012 Electric Vehicles deployment 20 million BEVs and PHEVs on the road by 2020. © OECD/IEA 2012 Translating targets into action 8 million sales/year 7 Manufacturers production/sales 6 5 Projection (Estimated from each country's target) Projection (Estimated from each country's target) 4 3 2 1 0 2010 2012 2014 2016 2018 2020 Government targets need to be backed by policy action. © OECD/IEA 2012 Other 2020 targets to reach 2DS Implement fuel economy standards through at least 2020 for LDVs and trucks in all major economies Reach 5% of the fuel mix using biofuels, transitioning to advanced biofuels ASAP Double the bus rapid transit global network Increase by 50% the high speed rail network Internalise the external cost of transport into fuel cost Develop international tools to incentivise international shipping and aviation decarbonisation Pursue RD&D efforts to further develop fuel cell vehicles © OECD/IEA 2012 A low carbon future may save money More than USD 60 trillion saved over the next 4 decades by saving fuel, and also reducing vehicle and infrastructure spendings. © OECD/IEA 2012 Focus on vehicle infrastructure © OECD/IEA 2012 Infrastructure needs booming in Non-OECD countries by 2050 Road extent would need to increase by more than 60% to cope with the traffic activity increase in 4DS. Rail increases by 20% in the 2DS. © OECD/IEA 2012 Road space may become much more crowded in Non-OECD Given car travel projections in 4DS, even with strong increases in road infrastructure, this may not be enough to cope with traffic growth Average vehicle density on roads in Non-OECD may overtake OECD levels by 2030, become much worse by 2050 © OECD/IEA 2012 Buildings Chapter 14 © OECD/IEA 2012 Key findings The buildings sector must reduce its total emissions by over 60% by 2050. Technologies that can help achieve such reductions are already available. With more than half the current stock expected to still be standing in 2050, actions cannot be limited to tighter controls on new construction only. A necessary first step is to improve energy performance of building shell, which has the additional benefit of allowing a downsizing of the heating and cooling equipment. Additional investment needed to realise the 2DS is estimated to be USD 11.5 trillion. © OECD/IEA 2012 Electricity demand becomes the largest single source of energy Buildings-sector energy consumption Despite a 65% increase in households and 72% increase in services floor area, energy consumption in 2050 is only 11% higher than in 2009. © OECD/IEA 2012 The improvement in intensity will not be sufficient to decrease energy consumption Residential sub-sector energy consumption and intensity Despite important decreases in residential energy intensity in OECD countries, their intensity is still much higher than in non-OECD countries. © OECD/IEA 2012 Greater use of electrical end-uses in nonOECD will drive the intensity upward Services sub-sector energy consumption and intensity The strong increase in floor area in non-OECD countries will drive the 88% increase in energy consumption in the 2DS. © OECD/IEA 2012 Building Blocks of a Cleaner Future Space heating Water heating energy savings TotalTotal energy savings 33 EJ33 EJ Cooking Cooling and ventilation Space heating Water heating 22% Lighting Cooking Residential Total energy savings 3315% EJ Appliances Services Space heating Water heating Cooling and ventilation 12% 22% 3% 3% Lighting 15% 2% Other 15% 12% 7% 3% 10% 6% 3% 2% 5% 15% 7% Cooling and ventilation Space heating Lighting Water heating Appliances Cooking Space heating Cooling and ventilation Water heating Lighting Cooling and ventilation Appliances Lighting Space heating Other Water heating Cooling and ventilation 10% 6% 5% Lighting Other About 70% of buildings’ potential energy savings between the 4DS and 2DS are in the residential sector. © OECD/IEA 2012 Building sector challenges differ Billion households ,2.5 ,2.0 ,1.5 ,1.0 ,0.5 ,0.0 2010 OECD 2020 2030 2040 2050 Non OECD 75% of current buildings in OECD will still be standing in 2050 © OECD/IEA 2012 The savings can only be achieved if the entire buildings system contributes Improvements in the building shell and energy savings in electrical end-uses dominate total CO2 reductions. © OECD/IEA 2012 Priority actions to deliver the 2DS Areas for policy action Overall savings Policy urgency potential Energy efficiency of building shell measures New residential buildings Medium to large Urgent Retrofitted residential buildings Large Urgent New sevice buildings Large Urgent Retrofitted service buildings Medium to large Urgent Energy efficiency of lighting, appliances and equipment Lighting Medium Average Appliances Large Average Water heating systems Large Urgent Space heating systems Medium to large Urgent Cooling/ventilation systems Medium to large Urgent Cooking Small to medium Average/urgent Fuel switching Water heating systems Medium to large Urgent/average Space heating systems Medium to large Urgent/average Cooking Small Average/urgent Bulk of savings available Immediately and medium- to long-term Immediately and medium- to long-term Immediately and medium- to long-term Immediately and medium- to long-term Immediately Short- to medium-term Short- to medium-term Short- to medium-term Short- to medium-term Immediately Short- to long-term Short- to long-term Short to medium-term © OECD/IEA 2012 Opportunities and recommendations Ambitious long-term strategy should take a holistic approach that addresses indoor comfort, energy security, fuel poverty and climate challenges. Government should develop and enforce stringent buildings codes that include minimum energy performance for new and refurbished buildings. Minimum performance standards and regulations for appliances and equipment based on best available technologies should be develop. Governments need to define and enforce compliance procedures to ensure effective implementation of standards and regulations. © OECD/IEA 2012 Roadmaps Chapter 15 © OECD/IEA 2012 2075: can we reach zero emissions Chapter 16 © OECD/IEA 2012 What long-term CO2 reductions are needed? ETP scenarios have been extended and compared with IPCCbased representative concentration pathways ETP 2012 2DS is broadly consistent with a long term 2°C scenario (RCP3PD) that requires eliminating CO2 by 2075 © OECD/IEA 2012 The Extended and Alternative 2DS Alternative 2DS 35 30 25 20 15 10 5 0 -5 2009 2030 2050 2075 The alternative 2DS gets close to, but does not quite achieve, zero CO2 in 2075. © OECD/IEA 2012 The Extended 2DS – energy use Energy use continues to grow through 2075, but fossil fuel declines. © OECD/IEA 2012 The Extended 2DS – electricity Power generation reaches 99% very low- or zero-carbon technologies in 2075. © OECD/IEA 2012 The Extended 2DS – industry Most demand growth will come from non-OECD countries. © OECD/IEA 2012 The Extended 2DS – industry Bio-energy and alternative sources of energy account for 40% of energy use in the Alternative 2DS in 2075. © OECD/IEA 2012 The Extended 2DS – industry Breakthrough technologies are needed if industry is to reach near-zero levels of CO2 emissions by 2075. © OECD/IEA 2012 The Extended 2DS – transport In Extended 2DS, global transport energy use remains fairly flat after 2050 as activity growth slows and efficiency improvements continue. © OECD/IEA 2012 The Extended 2DS – buildings Biomass and other renewables grow significantly after 2050. © OECD/IEA 2012 The Extended 2DS – buildings The remaining direct CO2 emissions are primarily from natural gas use. © OECD/IEA 2012 What additional technologies could help? Many types of advanced and “breakthrough” technologies could help make it easier to reach zero CO2 emissions by 2075, particularly those that provide efficiency gains and aid deployment of near-zero Carbon fuels. Some specific technologies identified here include: Electricity: advanced nuclear reactors and fuel systems, enhanced geothermal systems, advanced ocean energy systems, more flexible electricity systems (e.g. with smart grid technologies) Industry: electricity based steel making, new low-carbon cements, hydrogen in the chemicals sector Transport: advanced light-weight materials, better energy (e.g. hydrogen, electricity) storage systems, new aircraft and ship designs, electrification of roadways via induction or tethered vehicles Buildings: dynamic building envelopes, advanced cogeneration systems © OECD/IEA 2012 Emissions must be eliminated by 2075 A zero-carbon future looks possible but will be very challenging, even if 2050 targets are met in the 2DS. © OECD/IEA 2012 Regional Spotlights Chapter 17 © OECD/IEA 2012 Brazil Regional Spotlights © OECD/IEA 2012 2050: Brazil’s CO2 emissions reduced by 60% in the 2 degree scenario Transport sector decarbonisation as main source of CO2 reduction © OECD/IEA 2012 Brazil electricity: Increased natural gas use leads to higher emissions in 4 degree scenario In the 2 degree scenario, renewables - notably hydro, wind and solar - cover the increase in electricity generation © OECD/IEA 2012 Hydropower is a giant Hydropower generation [TWh] 8 000 7 000 Non-OECD Europe and Eurasia 6 000 Other non-OECD Asia Other Latin America 5 000 China 4 000 Brazil 3 000 Africa and Middle East 2 000 OECD Europe 1 000 OECD Asia Oceania OECD Americas 0 1990 2000 Historic 2010 2020 2030 2040 2050 2DS Hydropower will continue to play a major role in power generation: hydropower generation more than doubles in the 2DS compared to today. © OECD/IEA 2012 Brazilian industrial energy use rises in all scenarios Implementation of the 2DS limits increase of CO2 emissions to 16% from today's level, mainly thanks to energy efficiency measures © OECD/IEA 2012 Key role for biofuels in Brazilian transport Very high share of cane and cellulosic bioethanol, along with biomass-to-biodiesel fuels help to decarbonise transport © OECD/IEA 2012 Brazil leads the way on FFVs Nearly 90% of new Brazilian light duty vehicles in 2011 are ethanol-gasoline compatible © OECD/IEA 2012 Energy efficiency and fuel switching as key to mitigation in the Brazilian buildings sector In the 4DS, building energy consumption in 2050 is almost two times higher than at present © OECD/IEA 2012 A low-carbon future for Brazil At present, Brazil has one of the highest shares of renewables in its energy mix worldwide The maintenance of a clean energy matrix and further mitigation entails opportunities and challenges Brazil can maintain a leadership position in the deployment of low-carbon technologies Address difficulties that could potentially hamper growth in power generation from hydropower and wind Further expand the production and use of sustainable biofuels in the transport sector Bring experience and knowledge for international cooperation © OECD/IEA 2012 Japan Regional Spotlights © OECD/IEA 2012 Renewables grow in Japan but uncertainty is high TWh Drivers: Uncertainties about nuclear restart New feed-in tariffs Good match of solar PV for shaving peak load Challenges: Power system fragmentation Relatively high capital costs of renewable energy Location of wind and geothermal resources far from demand centres Japan forecast renewable generation 180 160 140 120 100 80 60 40 20 0 2011 2012 2013 2014 2015 2016 2017 Hydropower Bioenergy Solar PV Wind onshore Geothermal Wind offshore Japan power generation by share, 2011 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% IEA MRMR report 2010 Jan 11 Nuclear Mar 11 May 11 Combustible Fuels Jul 11 Sep 11 Hydro Nov 11 Other © OECD/IEA 2012 Power generation; Nuclear Installed capacity Nuclear deployment by 2025 will be below levels required to achieve the 2DS objectives after the Fukushima accident although the vast majority of countries remain committed to its use. © © OECD/IEA OECD/IEA 2012 2012 Japan: End-use energy efficiency is critical In the Japanese buildings sector, reduced electricity demand and power decarbonisation are key to achieve the 2DS. © OECD/IEA 2012 Japan: Alternative fuels are essential 90 % of sales in Japan in 2050 should be an electrically driven car with low carbon electricity and hydrogen © OECD/IEA 2012 European Union Regional Spotlights © OECD/IEA 2012 Low-carbon electricity: a clean core EU electricity generation in the 2DS 5 000 Other Wind Solar Hydro Nuclear Biomass and waste Oil Gas Coal TWh 4 000 3 000 2 000 1 000 0 2009 2020 2030 2040 2050 100% 19% 80% 60% 28% 69% 40% 20% Renewables Nuclear Fossil w CCS Fossil w/o CCS 53% 22% 6% 2% 0% 2009 2050 Renewables will generate more than two thirds of EU electricity in 2050 in the 2DS © OECD/IEA 2012 EU Electricity: renewables dominate growth and nuclear holds its position Renewables cover two-thirds of the electricity mix in 2050 in the 2DS, with wind power alone reaching a share of 30% in the mix. © OECD/IEA 2012 Renewables need to dominate EU electricity 5 000 100% 4 500 90% 4 000 80% 3 500 70% 2 500 2 000 13% 17% Other renewables Other renewables Other renewables 10% Wind Wind Wind 21% Generation share TWh 3 000 4% 4% 28% 28% 7% 60% Solar Solar Solar 9% 50% 40% 1 500 30% 1 000 20% 500 10% 0 0% 22% Hydro Hydro Hydro 13% Nuclear Nuclear Nuclear 1% 53% 23% Fossil w CCS Fossil w CCS Fossil w CCS 27% 7% 2% 4DS 2009 2009 10% 2009 Fossil Fossil w/ow/o CCS CCS Fossil w/o CCS 4DS 2DS 2DS 2050 2050 2050 Renewables cover two-thirds of the electricity mix in 2050 in the 2DS, with wind power alone reaching a share of 30% in the mix. © OECD/IEA 2012 EU: Wind and solar must grow quickly Hydro Nuclear CSP 2020-50 PV Wind, offshore 2010-20 Wind, onshore 2006-10 Biomass Gas with CCS Coal with CCS 0 2 4 6 8 GW per year 10 12 14 16 An additional USD 1.2 trillion are needed in the EU power sector, but fuel savings amount to USD 2.7 trillion © OECD/IEA 2012 Key technologies for the power sector Next decade 2010-2020: Accelerated deployment of onshore wind and solar PV Development of several large-scale commercial projects for CCS (5 GW in 2020) and offshore wind (14 GW in 2020) Modernisation of ageing T&D infrastructure Thereafter 2020-2050: Wider deployment of CCS, not only coal-fired, but also gasbased (though overall gas generation declines after 2030) Accelerated growth in offshore wind More flexible electricity system needed to integrate increasing share of variable renewables (reaching 60% of the installed capacity in 2050) Nuclear can continue to play an important role, but financing and public acceptance are critical factors © OECD/IEA 2012 By 2050, Renewables need to dominate electricity in OECD Europe 5 000 100% 4 500 1 500 1 000 500 Other renewables Other renewables Other renewables Wind Wind Wind 80% 21% 70% Generation share TWh 2 000 17% 10% 3 500 2 500 13% 90% 4 000 3 000 4% 4% 28% 28% 7% 60% 9% 50% 40% 22% 30% 20% Hydro Hydro Hydro 13% Nuclear Nuclear Nuclear 23% Fossil w CCS Fossil w CCS Fossil w CCS 27% 10% 7% 2% 0% 2009 2009 10% 1% 53% 0 Solar Solar Solar 4DS 2009 4DS 2050 2050 Fossil w/o Fossil CCS Fossil w/ow/o CCSCCS 2DS 2DS 2050 Renewables cover two-thirds of the electricity mix in 2050 in the 2DS, with wind power alone reaching almost a share of 30% in the mix. © OECD/IEA 2012 All flexibility sources will be needed Dispatchable power plants Demand side Response (via smart grid) Energy storage facilities Interconnection with adjacent markets Industrial Biomass-fired power plant residential Pumped hydro facility Scandinavian interconnections © OECD/IEA 2012 More renewable energy means network upgrades Europe: Grid upgrades, 2010-50 Source: EWI Cologne, Optimal transmission grid scenario © OECD/IEA 2012 Learning by doing achievements have exceeded expectations Solar PV system cost and feed-in tariff, large solar plants, Germany 2006-12 €/MWh €/kW 6000 500 5000 400 4000 300 3000 200 2000 100 1000 - Apr Jun Aug Oct Dec Feb Apr Jun Aug Oct Dec Feb Apr Jun Aug Oct Dec Feb Apr Jun Aug Oct Dec Feb Apr Jun Aug Oct Dec Feb Apr Jun Aug Oct Dec Feb 600 2007 2008 FIT [€/MWh] 2009 2010 2011 0 2012 System cost [EUR/kW] Some technologies are now ready to face greater competition © OECD/IEA 2012 Europe must move towards a single market in renewable energy Fig 1. EU New generation capacity by year of first generation Fig 2. RES support mechanism by EU member Feed-in Premium 60 40 GW Lithuania RENEWABLES NUCLEAR GAS COAL 50 Austria Bulgaria Cyprus France Ireland Germany 30 Greece 20 Latvia 10 Malta 0 2000 2004 2008 2012 Forecast Spain Denmark Czech R. The Netherlands Slovenia Estonia Hungary Italy Luxembourg Slovak Republic Belgium Romania Sweden UK Portugal Feed-in Tariffs Poland Quota Obligations Renewable generation in Europe is growing rapidly, but supporting policies are yet to be harmonised, limiting competition Sources: Fig 1, Platts/European Wind Association; Fig 2: Council of European Energy Regulators. (FITs to be introduced into Germany in 2012) © OECD/IEA 2012 Renewables: mid term forecast for Spain TWh Spain forecast renewable generation 120 Drivers: Abundant renewable resources Strong grid and advanced integration of variable renewable sources Challenges: Overcapacity of electricity system Need to correct for persistently high tariff deficit 100 80 60 40 20 0 2011 120 2012 2013 2014 2015 2016 Hydropower Wind onshore Solar PV Bioenergy CSP Wind offshore 2017 Spain power capacity vs peak load (GW) 100 80 60 40 20 0 2005 2006 2007 2008 2009 2010 2011 Nuclear Hydropower Combustible fuels Solar Wind Peak load © OECD/IEA 2012 UK electricity fleet is ageing UK age distribution of power plants in 2011 (GW) Unknown age More than 50 years 40-50 years 30-40 years 20-30 years 10-20 years Less than 10 years 0 Coal 5 Oil 10 15 Natural gas 20 Nuclear 25 What will replace the ageing coal fired electricity generation plants? © OECD/IEA 2012 UK renewables outlook is positive TWh UK forecast renewable generation 90 80 70 60 50 40 30 20 10 0 2011 2012 Hydropower Wind offshore 2013 2014 Bioenergy Solar PV 2015 2016 2017 Wind onshore Ocean Broad and strong political commitment and to low carbon electricity drives growth © OECD/IEA 2012 ICE vehicles will dominate LDV sales through 2030 Cumulative EU27 LDV sales by technology type Need to focus policy on efficiency while preparing for decarbonisation. Standards and policy harmonization critical. © OECD/IEA 2012 ICE vehicles will dominate LDV sales through 2030 EU27 LDV sales in the 2DS 25 20 FCEV 15 Electricity Plug-in hybrid Hybrid 10 CNG/LPG Gasoline/diesel 5 0 2000 2010 2020 2030 2040 2050 Need to focus policy on efficiency while preparing for decarbonisation. Standards and policy harmonization critical. © OECD/IEA 2012 EU –wide consistency? Need to focus policy on efficiency while preparing for decarbonisation. Standards and policy harmonization critical. © OECD/IEA 2012 Key technologies for EU industry Next decade 2010-2020: Increase energy efficiency: energy recovery & process integration Heat decarbonisation Site level Learn, track, benchmark & improve efficiency Across Industry and beyond Heat mapping [temperature level] Low temp. applications Higher penetration of renewables Replacement of fossil-fuels by biomass/waste fuels Increase industrial CHP: specially chemicals/petrochemicals and pulp & paper Cement: Clinker substitutes, Alternative fuels Chemicals: Olefin production from catalytic cracking © OECD/IEA 2012 Key technologies for EU industry Thereafter 2020-2050: Wider deployment of CCS Iron & Steel: Chemicals: Methanol to olefin production route Pulp & Paper: Top-gas recycling blast furnace Use of highly reactive materials Smelting reduction Black liquor gasification Advanced water removal technologies Aluminium: Wetted drained cathodes Inert cathodes Carbothermic and/or kaolinite reduction © OECD/IEA 2012 India Regional Spotlights © OECD/IEA 2012 Key technologies to decarbonise Indian power generation 3.5 Emissions 6DS 3.0 4DS 2DS GtCO2 2.5 2.0 Emissions reductions CCS 1.5 Nuclear 1.0 Solar Wind 0.5 Other renewables 0.0 Emissions 2009 Emissions Reductions Resulting 2DS emissions 2030 Emissions Reductions Resulting 2DS emissions 2050 Electricity savings Fuel switching and efficiency © OECD/IEA 2012 India: Sectoral Contributions to achieve the 2DS from the 4DS 8 6DS emissions 6 Agriculture, other 1% GtCO2 Other transformation 3% 4 Power 43% Industry 20% 2 Transport 22% Buildings 10% 0 2009 2020 2030 2040 2050 The power sector, transport and industry would provide the largest reduction of emissions in the 2DS. © OECD/IEA 2012 India: Electricity generation in the 4DS and 2DS 2DS 4DS 5 000 4 000 4 000 3 000 3 000 2 000 2 000 1 000 1 000 0 0 TWh 5 000 2009 2020 2030 2040 2050 2009 2020 2030 2040 2050 Coal Coal w CCS Natural gas Natural gas w CCS Oil Biomass and waste Nuclear Hydro Wind Solar Other renewables © OECD/IEA 2012 Mexico Regional Spotlights © OECD/IEA 2012 CO2 emissions in Mexico halved by 2050 800 MtCO 2 700 6DS 600 Agriculture, other 1% 500 Other transformation 7% Power 37% 400 Industry 17% 300 Transport 23% 200 Buildings 16% 100 0 2009 2020 2030 2040 2050 The power sector provides almost 40% of the cumulative CO2 reductions compared to the 4DS © OECD/IEA 2012 Mexico: Extensive deployment of clean energy technologies Additional emissions in 6DS Fuel switching and efficiency improvemnets Electricity savings 300 Mt CO 2 250 200 Other renewables Wind 150 Solar 100 Biomass Nuclear 50 CCS 0 2009 2030 2050 2DS emissions Electricity savings, solar and wind power as key mitigation options in Mexico © OECD/IEA 2012 Greening the Mexican vehicle fleet Most of the greening of the Mexican vehicle fleet is achieved by drop-in biofuels © OECD/IEA 2012 Mexico: End-use energy efficiency is critical In the buildings sector, more than half of the reductions will come from decarbonisation of the power sector. © OECD/IEA 2012 A low-carbon future for Mexico Low-carbon development has already been made a priority First successes have been achieved, more ambitious actions will be necessary to meet the 2DS New Climate Law represents an excellent basis for action – need to maintain momentum! Mexico is well placed for a “green” development strategy and ambitious climate goals © OECD/IEA 2012 Russia Regional Spotlights © OECD/IEA 2012 Fossil-fuel based electricity generation drops by almost half in Russia by 2030 Increased electricity generation from nuclear and renewables is the key for Russia to get on track © OECD/IEA 2012 Russia’s CO2 emissions need to drop dramatically The power and industry sectors account for over half of the reductions relative to the 2DS © OECD/IEA 2012 Natural gas plays an increasingly key role in the industry sector Energy efficiency measures through best available technologies brings 50% of the CO2 reductions. © OECD/IEA 2012 Growth in buildings energy consumption can be limited Effective implementation of energy efficiency policies is critical and supports large-scale refurbishment of ageing buildings to stringent code levels © OECD/IEA 2012 Russian car ownership more than doubles by 2050 Hybrid, plug-in hybrid or battery electric vehicles will be key to increasing vehicle efficiency in Russia © OECD/IEA 2012 Russia’s room to manoeuvre ETP 2012 projects a very different path for Russia High average age of infrastructure brings opportunity Creation of Russian Technology Platforms Presidential focus on innovation and modernisation Overall investment environment Regulatory framework needs to be completed IEA stands ready to work with Russia © OECD/IEA 2012 United States Regional Spotlights © OECD/IEA 2012 CO2 reductions in the US 7 6DS emissions 6 Agriculture, other 1% 5 GtCO 2 Other transformation 6% 4 Power 32% 3 Industry 11% 2 Transport 31% 1 0 2009 Buildings 20% 2020 2030 2040 2050 The power and transport sectors are key to achieving the 2DS. © OECD/IEA 2012 Rocky road ahead for US renewables GW 10 US wind capacity growth Forecast based on expiration of PTC at end-2012 8 6 Expiration of federal PTC 4 2 0 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016 Policy uncertainty, competition from natural gas and cost of capital slow renewables growth © OECD/IEA 2012 USA: large renewable and nuclear deployment needed for 2DS Natural gas is dominant in 4DS. © OECD/IEA 2012 Rocky road ahead for US renewables GW 10 US wind capacity growth Forecast based on expiration of PTC at end-2012 8 6 Expiration of federal PTC 4 2 0 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016 Policy uncertainty, competition from natural gas and cost of capital slow renewables growth © OECD/IEA 2012 Fuel economy makes a difference PLDV fuel consumption - WORLD 2500 10 8 6DS 6 Better FE 4 2 2010 2DS 2020 2030 2040 2050 [billion Lge/year] [Lge/100km] PLDV tested fuel economy WORLD (new car average) 2000 1500 Better FE 1000 2DS(I/A/S ) 500 0 2010 6DS equivalent to 11mbbl/day reduction 2020 2030 2040 2050 Fuel economy improvements in conventional and hybrid vehicles alone can save 11 mbbl/day. © OECD/IEA 2012 …but modal shift is also needed Passenger mode share in the US Fuel economy alone is not enough to meet 2DS targets © OECD/IEA 2012 Non-conventional gas is delivering large, low cost emission reductions Gas and coal fired power generation in the US, actual and IEA Medium Term Outlook © OECD/IEA 2012 Cheap gas has not yet hurt renewables – and it needs to stay that way Twh usd/mbtu © OECD/IEA 2012 US renewable policies lack coordination US state-based renewable energy mandates, 2010 15% by 2010 10% by 2015 15% by 2015 10% by 2015 25% by 2025 40% by 2017 25% by 2025 10% by 2015 20% by 2010 33% by 2020 20% by 2025 15% by 2025 25% by 2025 20% by 2010 15% by 2021 20% by 2020 10% by 2012 10% by 2015 1 GW (~2%) 1999 20% by 2015 23.8% by 2015 12.5 % by 2024 24% by 2013 15% by 2020 8% by 2020 16% by 2019 12% by 2022 12.5% by 2021 23% by 2020 22.5% by 2021 20% by 2019 20% by 2020 5.9 GW (~5.5%) by 2015 Source: National Renewable Energy Laboratory Mandates cover around half power generated in the USA Lack of Federal coordination hampers development of renewable energy © OECD/IEA 2012 First in 30 years, to be followed by a dozen others… Plant Vogtle nuclear expansion approved The Nuclear Regulatory Commission’s on Thursday approved Southern Co.’s plan to build two reactors at Plant Vogtle, south of Augusta. The Vogtle project will be built with a new reactor design, the AP1000 from Westinghouse, approved in December. An NRC report said the AP1000 design has “many of the design features and attributes necessary to address” new safety recommendations since the disaster. © OECD/IEA 2012 For much more, please visit www.iea.org/etp © OECD/IEA 2012
