BLOOMBERG NEW ENERGY
FINANCE SUMMIT 2015
NEW YORK
14 APRIL 2015
Michael Liebreich, Chairman
of the Advisory Board
Twitter: @mliebreich
NEW INVESTMENT IN CLEAN ENERGY
2004-14 ($BN)
600
400
400
350
500
300
400
250
300
200
-7%
-9%
15%
-8%
12%
31%
300
250
17%
12%
1%
27%
-9%
Expected
Large hydro
Large hydro
Other
Other
200 36%
150
50%
45%150
200
100
16%
35%
350
7%
-8%
Solar
Solar
30%
46%
Wind
Wind
100
100
50
00
50
2004
2005
0
2006
2007
2008
2009
2010
2011
2012
2013
2014
2005 2008
2006 2009
2007 2010
2008
2009
2010
2013
2014
2004 2005 200620042007
2011
2012 2011
2013201220142015
Q1
Note: Total values include estimates for undisclosed deals. Includes corporate and government R&D, and spending for digital
energy and energy storage projects (not reported in quarterly statistics), as well as a BNEF estimate for large hydro investment.
Michael Liebreich, New York, 14 April 2015
@MLiebreich
Source: Bloomberg New Energy Finance
#BNEFSummit
1
NEW INVESTMENT IN CLEAN ENERGY
2004-14 ($BN)
400
350
300
250
200
150
600
400
50
-7%
-7%
-8%
-8%
35%
35%
350
500
300
12%
12%
400
250
12%
12%
-9%
-9%
Large hydro
Expected
27%
27%
300
200
Other hydro
Large
Other
Solar
50%
50%
Solar
150 30%
200
100
7%
7%
Wind
30%
Wind
100
100
50
0
00
2004
2005
2006
2007
2008
2009
2004
2005
2006
2007
2008
2009
2010
2010
2011
2011
2012
2012
2013
2013
2014
2014
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 20142015 Q1
Note: Total values include estimates for undisclosed deals. Includes corporate and government R&D, and spending for digital
energy and energy storage projects (not reported in quarterly statistics), as well as a BNEF estimate for large hydro investment.
Michael Liebreich, New York, 14 April 2015
@MLiebreich
Source: Bloomberg New Energy Finance
#BNEFSummit
2
WTI CRUDE OIL PRICES, 2010–14
($2014 / BARREL)
120
100
80
60
40
20
0
2010
2011
2012
2013
2014
Note: WTI crude oil prices adjusted to inflation
Michael Liebreich, New York, 14 April 2015
2015
Source: Bloomberg New Energy Finance, World Bank
@MLiebreich
#BNEFSummit
3
WTI CRUDE OIL PRICES, 2000–14
($2014 / BARREL)
180
160
140
120
100
or
80
60
40
?
20
0
2000
2002
2004
2006
2008
2010
2012
2014
Source: Bloomberg New Energy Finance, World
Bank
Note: WTI crude oil prices adjusted to inflation
Michael Liebreich, New York, 14 April 2015
@MLiebreich
#BNEFSummit
4
OIL PRICE CRASH – V OR L?
Abdalla El-Badri, Secretary General,
OPEC
“If you don’t invest in oil
and gas, you will see
more than $200”
Michael Liebreich, New York, 14 April 2015
Bob Dudley CEO, BP
You won’t see $100 oil
again “for a long time”
Images: Bloomberg
@MLiebreich
#BNEFSummit
5
THE ECONOMIST COVER, “SHEIKHS VERSUS SHALE”, DECEMBER
2014
Source: The Economist
Michael Liebreich, New York, 14 April 2015
@MLiebreich
#BNEFSummit
6
US PETROLEUM PRODUCTION AND CONSUMPTION, 1970–2014
(BARRELS PER DAY)
22m
20m
Consumption
18m
16m
14m
12m
10m
8m
6m
Production
4m
2m
2014
2012
2010
2008
2006
2004
2002
2000
1998
1996
1994
1992
1990
1988
1986
1984
1982
1980
1978
1976
1974
1972
1970
0m
Source: EIA
Michael Liebreich, New York, 14 April 2015
@MLiebreich
#BNEFSummit
7
US VEHICLE MILES TRAVELLED
(MILLION MILES)
3,500,000
3,000,000
Gap to trend:
17% in 10
years
2,500,000
2,000,000
1,500,000
1,000,000
500,000
0
1975
1980
1985
1990
1995
2000
2005
2010
Note: Moving 12-month total of vehicle miles travelled in the US. Created from monthly data, and not seasonally adjusted
Michael Liebreich, New York, 14 April 2015
@MLiebreich
Source: US Federal Highways Administration
#BNEFSummit
8
US TOTAL VEHICLE FLEET FUEL EFFICIENCY, 1990–2014
(AVERAGE MILES PER GALLON)
Improvement
29% in 13 years
25.4
24.5 24.5
Note: In Michael Liebreich's Summit delivery, he stated in
error that the improvement had been 60%.
Michael Liebreich, New York, 14 April 2015
4
1
0
2
2014
2
1
0
2
2012
0
1
0
2
2010
8
0
0
2
2008
6
0
0
2
2006
4
0
0
2
2004
2
0
0
2
2002
0
0
0
2
2000
8
9
9
1
1998
6
9
9
1
1996
4
9
9
1
1994
2
9
9
1
1992
1990
0
9
9
1
31.6
Source: US Department of Transportation NHTSA
@MLiebreich
#BNEFSummit
9
THE FUTURE IS ELECTRIC
Prices on electric cars will continue to drop until
they're within reach of the average family.
The Washington
Post 1915
Images: BMW, Detroit Electric, 2015, courtesy of EVASD
Michael Liebreich, New York, 14 April 2015
@MLiebreich
#BNEFSummit
10
ELECTRIC VEHICLE UPTAKE
CARS AND TRUCKS IN USE
WORLDWIDE, 2013
1.2 billion
ELECTRIC VEHICLES IN
USE WORLDWIDE, 2014
0.75 million (to scale)
Source: International Organization of Motor Vehicle Manufacturers, Bloomberg New Energy Finance
Michael Liebreich, New York, 14 April 2015
@MLiebreich
#BNEFSummit
11
LITHIUM-ION EV BATTERY EXPERIENCE CURVE
Historical price (USD/Wh)
100
10
2010
1
H1 2014
Li-ion EV battery
pack
0.1
1
10
100
1,000
10,000
100,000
Cumulative production (MWh)
Note: Prices are in real (2014) USD.
Michael Liebreich, New York, 14 April 2015
m=21.6%
1,000,000 10,000,000
Source: Bloomberg New Energy Finance, Maycock, Battery University, MIIT
@MLiebreich
#BNEFSummit
12
LITHIUM-ION EV BATTERY EXPERIENCE CURVE
COMPARED WITH SOLAR PV EXPERIENCE CURVE
Historical price (USD/W, USD/Wh)
100
1976
Crystalline Si PV
module
1998
2004
1988
10
2008
2010
1
2014
H1 2014
Li-ion EV battery
pack
0.1
1
10
100
1,000
10,000
100,000
Cumulative production (MW, MWh)
Note: Prices are in real (2014) USD.
Michael Liebreich, New York, 14 April 2015
m=24.3%
m=21.6%
1,000,000 10,000,000
Source: Bloomberg New Energy Finance, Maycock, Battery University, MIIT
@MLiebreich
#BNEFSummit
13
BEIJING, CHINA
Photo: Reuters/NASA
Michael Liebreich, New York, 14 April 2015
@MLiebreich
#BNEFSummit
14
SHENZHEN, CHINA
Photo: Brent Lewin/Bloomberg
Michael Liebreich, New York, 14 April 2015
@MLiebreich
#BNEFSummit
15
SHANGHAI, CHINA
Photo: TheMarySue
Michael Liebreich, New York, 14 April 2015
@MLiebreich
#BNEFSummit
16
DELHI, INDIA
Photo: JE Poirrier, Creative Commons
Michael Liebreich, New York, 14 April 2015
@MLiebreich
#BNEFSummit
17
HONG KONG
Photo: Greenpacks
Michael Liebreich, New York, 14 April 2015
@MLiebreich
#BNEFSummit
18
SINGAPORE
Photo: Bloomberg
Michael Liebreich, New York, 14 April 2015
@MLiebreich
#BNEFSummit
19
CAIRO, EGYPT
Photo: Matt Champlin / Flickr
Michael Liebreich, New York, 14 April 2015
@MLiebreich
#BNEFSummit
20
MEXICO CITY, MEXICO
Photo: Shinil GCP
Michael Liebreich, New York, 14 April 2015
@MLiebreich
#BNEFSummit
21
SAO PAULO, BRAZIL
Photo: Thomas Hobbs
Michael Liebreich, New York, 14 April 2015
@MLiebreich
#BNEFSummit
22
LOS ANGELES, USA
Photo: UCLA
Michael Liebreich, New York, 14 April 2015
@MLiebreich
#BNEFSummit
23
MOSCOW, RUSSIA
Photo: EarthInTransition
Michael Liebreich, New York, 14 April 2015
@MLiebreich
#BNEFSummit
24
PARIS, FRANCE
Photo: D€NNI$/Creative Commons
Michael Liebreich, New York, 14 April 2015
@MLiebreich
#BNEFSummit
25
LONDON, UK
Photo: HHRCA
Michael Liebreich, New York, 14 April 2015
@MLiebreich
#BNEFSummit
26
URBAN TRANSPORT REVOLUTION
Images: Transport for London, Zipcar, Uber, Proterra
Michael Liebreich, New York, 14 April 2015
@MLiebreich
#BNEFSummit
27
OIL AND GAS PRICES: HENRY HUB, NBP, BAFA, AND NE
LNG, 2004-2015 (US$/MM BTU)
20
20
18
~ $5 spread to
Henry Hub?
> $8 spread
to Henry hub
~ $5 spread
to Henry Hub
18
16
16
14
NBP (UK)
14
12
12
Henry Hub (US)
10
10
8
BAFA (Germany
border price for
Russian gas)
8
6
6
North East Asia LNG
4
4
2
2
0
2004
2005
2006
0
2007
2008
2009
2010
2011
2012
2013
Note: Japan-Korea Marker is based on broker assessments of the spot price of un-contracted LNG
cargoes delivered into the Northeast Asia market.
Michael Liebreich, New York, 14 April 2015
2014
2015
Source: Bloomberg New Energy Finance, ICAP, Platts
@MLiebreich
#BNEFSummit
28
US SHALE GAS PRODUCTION BY FIELD, 2000–14
BCFD
50
45
45
1 2 3 4 5 6 7 8 9 10 11 12 13 14
2500
Number
Marcellus
40
40
40
35
30
30
2000
35
Haynesville
1500
25
Barnett
Woodford
Barnett
Bakken
20
1000
20
10
25
Bakken
Woodford
Antrim
Antrim
Bakken
Utica
Utica
Antrim
Other
OtherShale
Shale
Utica
10
500
20
15
0
2005
2000
2005
Michael Liebreich, New York, 14 April 2015
Other
Shale
Gas rig
count
Canada
Total rig count
Iran
5
0
2000
Barnett
Fayetteville
Eagle Ford
Woodford
Fayetteville
30
15
Haynesville
Marcellus
Eagle Ford
Haynesville
Marcellus
Fayetteville
Eagle Ford
2010
2010
2015 0
Qatar
Source: EIA, Bloomberg New Energy Finance
Norway
2015
@MLiebreich
#BNEFSummit
29
LNG EXPORT CAPACITY BY COUNTRY/REGION
700
600
500
400
300
200
100
Note: For the underlying data to this chart, go to BI LNGGG<GO>
Michael Liebreich, New York, 14 April 2015
2020
2019
2018
2017
2016
2015
2014
2013
2012
2011
2010
2009
2008
0
Other
North America
Russia
East Africa
West Africa
Australia
Other
North America
Russia
West Africa
North Africa
Indonesia
Malaysia
Australia
Qatar
Demand
Operational, under
construction or
post-FID
800
Pre-FID
(MMTPA)
Source: Bloomberg New Energy Finance
@MLiebreich
#BNEFSummit
30
RENEWABLE ENERGY PROPORTION OF POWER
GENERATION, 2013 (%)
UK
19%
Spain
43%
Canada
76%
Germany
28%
Japan
11%
US
13%
No data
<5%
5-10%
11-20%
21-40%
>50%
China
22%
Brazil
71%
S. Africa
2%
India
6%
Australia
16%
Source: Oxford Energy, China Electricity Council, BDEW, UK Govt, REE, NRCAN, EIA, USEA, Bloomberg New Energy Finance
Michael Liebreich, New York, 14 April 2015
@MLiebreich
#BNEFSummit
31
6-CENT SOLAR – THE NEW NORMAL?
Name: Usain Bolt
Event: 100m
Record: 9.58 seconds
Name: Paddy Padmanathan
Event: Solar PV
Record: US$5.84c
Source: Bloomberg New Energy Finance
Michael Liebreich, New York, 14 April 2015
@MLiebreich
#BNEFSummit
32
GLOBAL GROSS POWER GENERATION CAPACITY
ADDITIONS, 2010–30 (GW)
FOSSIL FUEL
CLEAN ENERGY
279
Forecast
Forecast
Hydro
242
Nuclear
208
Solar
Oil
141
2013
2015
Biomass
& waste
Geotherm.
Coal
93
91
2010
Wind
143
Gas
110
105
164
2020
62
64
2025
2030
2010 2013 2015 2020 2025 2030
Source: Bloomberg New Energy Finance
Note: Underlying data is from GREMO 2014
Michael Liebreich, New York, 14 April 2015
@MLiebreich
#BNEFSummit
33
US & CHINA CAPACITY BUILD OUT
(GW)
China’s low-carbon
additions 2015-2030
~ 90% of US 2015
capacity
US
442
1,094
Incremental
low-carbon
1,384
Low-carbon
273
Fossil fuels
575
China
2,601
996
1,438
1,362
442
442
302
302
792
810
920
2014
2030
2014
Incremental
low-carbon
Existing
Low-carbon
low-carbon
Fossil
Fossil fuels
fuels
1,163
2030
Source: Bloomberg New Energy Finance
Michael Liebreich, New York, 14 April 2015
@MLiebreich
#BNEFSummit
34
RENEWABLES IN INDIA, 2006–22
(GW)
250
200
150
Solar 0.6GW/year
Wind 2.0GW/year
100
50
0
Upto
2006
2008
2010
2012
2014
2016
2018
2020
Note: The original version of this chart mistakenly
suggested that wind grew at 4.7GW/yr from 2006–14
Michael Liebreich, New York, 14 April 2015
2022
Source: Bloomberg New Energy Finance
@MLiebreich
#BNEFSummit
35
RENEWABLES IN INDIA, 2006–22
(GW)
250
200
Solar 6 GW/year
Wind 3 GW/year
150
Solar 0.6GW/year
Wind 2.0GW/year
100
50
0
Upto
2006
2008
2010
2012
2014
2016
2018
2020
Note: The original version of this chart mistakenly
suggested that wind grew at 4.7GW/yr from 2006–14
Michael Liebreich, New York, 14 April 2015
2022
Source: Bloomberg New Energy Finance
@MLiebreich
#BNEFSummit
36
RENEWABLES IN INDIA, 2006–22
(GW)
Modi target:
Solar 12 GW/year
Wind 8 GW/year
250
200
X
Solar 6 GW/year
Wind 3 GW/year
150
Solar 0.6GW/year
Wind 2.0GW/year
100
50
0
Upto
2006
2008
2010
2012
2014
2016
2018
2020
Note: The original version of this chart mistakenly
suggested that wind grew at 4.7GW/yr from 2006–14
Michael Liebreich, New York, 14 April 2015
2022
Source: Bloomberg New Energy Finance
@MLiebreich
#BNEFSummit
37
NUCLEAR POWER PLANTS – HISTORIC CONSTRUCTION
0-10
11-19
20-39
40-59
60+
566 nuclear
power stations
ever built
Source: Bloomberg New Energy Finance; IAEA, World Nuclear Association
Michael Liebreich, New York, 14 April 2015
@MLiebreich
#BNEFSummit
38
NUCLEAR POWER PLANTS – CURRENT CONSTRUCTION
1
2
3-5
6-9
10+
66 nuclear power
stations under
construction
Source: Bloomberg New Energy Finance; IAEA, World Nuclear Association
Michael Liebreich, New York, 14 April 2015
@MLiebreich
#BNEFSummit
39
ENERGY EFFICIENCY INVESTMENT VIA FORMAL
FRAMEWORKS, 1990–2013 ($BN)
50
45
Japan
40
China
35
Spain
Italy
30
UK
25
France
20
Germany
15
Brazil
10
Canada
5
US
0
'90
'95
'00
'05
'10 '13e
Note: Nominal dollars. Includes residential, commercial and industrial spending. For more details, see our H1 2014 Global
Energy Efficiency Market Outlook
Michael Liebreich, New York, 14 April 2015
@MLiebreich
Source: ACEEE, NAESCO, LBNL, CEE, IAEE,
ANEEL, BNDES, KfW, Emmy, ADEME, DECC,
OFGEM, GME, GSE, AEEG, IDAE, EMCA,
JAESCO, Bloomberg New Energy Finance.
#BNEFSummit
40
AUSTRALIA NATIONAL ELECTRICITY MARKET ACTUAL
VS FORECAST ELECTRICITY DEMAND FY2004–FY2025
TWh
AUD trillion
260
1.8
240
1.6
220
1.4
GDP
200
1.2
Historical
180
1.0
160
0.8
FY04
FY06
FY08
FY10
FY12
FY14
FY16
FY18
FY20
FY22
FY24
Source: Australian Energy Market Operator, Reserve Bank of Australia, Bloomberg New Energy Finance
Michael Liebreich, New York, 14 April 2015
@MLiebreich
#BNEFSummit
41
AUSTRALIA NATIONAL ELECTRICITY MARKET ACTUAL
VS FORECAST ELECTRICITY DEMAND FY2004–FY2025
TWh
AUD trillion
260
1.8
2010
240
1.6
220
1.4
GDP
200
1.2
Historical
180
1.0
160
0.8
FY04
FY06
FY08
FY10
FY12
FY14
FY16
FY18
FY20
FY22
FY24
Source: Australian Energy Market Operator, Reserve Bank of Australia, Bloomberg New Energy Finance
Michael Liebreich, New York, 14 April 2015
@MLiebreich
#BNEFSummit
42
AUSTRALIA NATIONAL ELECTRICITY MARKET ACTUAL
VS FORECAST ELECTRICITY DEMAND FY2004–FY2025
TWh
AUD trillion
260
1.8
2010
2011
240
1.6
220
1.4
GDP
200
1.2
Historical
180
1.0
160
0.8
FY04
FY06
FY08
FY10
FY12
FY14
FY16
FY18
FY20
FY22
FY24
Source: Australian Energy Market Operator, Reserve Bank of Australia, Bloomberg New Energy Finance
Michael Liebreich, New York, 14 April 2015
@MLiebreich
#BNEFSummit
43
AUSTRALIA NATIONAL ELECTRICITY MARKET ACTUAL
VS FORECAST ELECTRICITY DEMAND FY2004–FY2025
TWh
AUD trillion
260
1.8
2010
2011
240
1.6
220
1.4
GDP
200
1.2
Historical
180
1.0
160
0.8
FY04
FY06
FY08
FY10
FY12
FY14
FY16
FY18
FY20
FY22
FY24
Source: Australian Energy Market Operator, Reserve Bank of Australia, Bloomberg New Energy Finance
Michael Liebreich, New York, 14 April 2015
@MLiebreich
#BNEFSummit
44
AUSTRALIA NATIONAL ELECTRICITY MARKET ACTUAL
VS FORECAST ELECTRICITY DEMAND FY2004–FY2025
TWh
AUD trillion
260
1.8
2010
2011
240
1.6
220
1.4
GDP
200
1.2
Historical
180
1.0
160
0.8
FY04
FY06
FY08
FY10
FY12
FY14
FY16
FY18
FY20
FY22
FY24
Source: Australian Energy Market Operator, Reserve Bank of Australia, Bloomberg New Energy Finance
Michael Liebreich, New York, 14 April 2015
@MLiebreich
#BNEFSummit
45
AUSTRALIA NATIONAL ELECTRICITY MARKET ACTUAL
VS FORECAST ELECTRICITY DEMAND FY2004–FY2025
TWh
AUD trillion
260
1.8
2010
2011
240
1.6
2012
220
1.4
GDP
200
1.2
Historical
180
1.0
160
0.8
FY04
FY06
FY08
FY10
FY12
FY14
FY16
FY18
FY20
FY22
FY24
Source: Australian Energy Market Operator, Reserve Bank of Australia, Bloomberg New Energy Finance
Michael Liebreich, New York, 14 April 2015
@MLiebreich
#BNEFSummit
46
AUSTRALIA NATIONAL ELECTRICITY MARKET ACTUAL
VS FORECAST ELECTRICITY DEMAND FY2004–FY2025
TWh
AUD trillion
260
1.8
2010
2011
240
1.6
2012
220
1.4
GDP
200
1.2
Historical
180
1.0
160
0.8
FY04
FY06
FY08
FY10
FY12
FY14
FY16
FY18
FY20
FY22
FY24
Source: Australian Energy Market Operator, Reserve Bank of Australia, Bloomberg New Energy Finance
Michael Liebreich, New York, 14 April 2015
@MLiebreich
#BNEFSummit
47
AUSTRALIA NATIONAL ELECTRICITY MARKET ACTUAL
VS FORECAST ELECTRICITY DEMAND FY2004–FY2025
TWh
AUD trillion
260
1.8
2010
2011
240
1.6
2012
220
2013
1.4
GDP
200
1.2
Historical
180
1.0
160
0.8
FY04
FY06
FY08
FY10
FY12
FY14
FY16
FY18
FY20
FY22
FY24
Source: Australian Energy Market Operator, Reserve Bank of Australia, Bloomberg New Energy Finance
Michael Liebreich, New York, 14 April 2015
@MLiebreich
#BNEFSummit
48
AUSTRALIA NATIONAL ELECTRICITY MARKET ACTUAL
VS FORECAST ELECTRICITY DEMAND FY2004–FY2025
TWh
AUD trillion
260
1.8
2010
2011
240
1.6
2012
220
2013
1.4
GDP
200
1.2
2014
Historical
180
1.0
160
0.8
FY04
FY06
FY08
FY10
FY12
FY14
FY16
FY18
FY20
FY22
FY24
Source: Australian Energy Market Operator, Reserve Bank of Australia, Bloomberg New Energy Finance
Michael Liebreich, New York, 14 April 2015
@MLiebreich
#BNEFSummit
49
AUSTRALIA NATIONAL ELECTRICITY MARKET ACTUAL
VS FORECAST ELECTRICITY DEMAND FY2004–FY2025
TWh
AUD trillion
260
1.8
2010
2011
240
1.6
2012
220
2013
1.4
GDP
200
1.2
2014
Historical
180
1.0
160
0.8
FY04
FY06
FY08
FY10
FY12
FY14
FY16
FY18
FY20
FY22
FY24
Source: Australian Energy Market Operator, Reserve Bank of Australia, Bloomberg New Energy Finance
Michael Liebreich, New York, 14 April 2015
@MLiebreich
#BNEFSummit
50
THE AGE OF
PLENTY…
…THE AGE OF
COMPETITION
Michael Liebreich, New York, 14 April 2015
@MLiebreich
#BNEFSummit
51
OIL AND GAS MERGERS AND ACQUISITIONS
Images: Various; Wikimedia
Michael Liebreich, New York, 14 April 2015
@MLiebreich
#BNEFSummit
52
IMPACT OF LOWER OIL AND GAS PRICES
($BN/YR)
Canada
- $40 billion
Norway
- $53 billion
Europe
+ 300 billion
???
Asia
+ 393 billion
USA
+ 180 billion
Latin America
- $60 billion
Russia & C. Asia
- $218 billion
North Africa
- $62 billion
Note: Calculation based on $5 drop in natural gas price and $50 drop in oil price; based on
import/export volumes 2011-2013, excluding impact of changes in volumes since then
Michael Liebreich, New York, 14 April 2015
Sub-Saharan Africa
- $89 billion
Middle East
- $357 billion
Source: Bloomberg New Energy Finance; CIA Fact Book; IEA; EIA; World Bank; IMF
@MLiebreich
#BNEFSummit
53
COAL DEPENDENCY, G20, 2013
(% OF PRIMARY ENERGY)
80%
70%
60%
50%
40%
G20 average 33%
30%
20%
10%
0%
Note: Data comes from the IEA Global Statistics database. Where actual 2013 data was unavailable, IEA produced an estimate
figure
Michael Liebreich, New York, 14 April 2015
@MLiebreich
Source: IEA, Bloomberg New Energy Finance
#BNEFSummit
54
US CAPACITY BUILD, 2008–20
(GW)
Up to 23GW of US
coal capacity coming
offline in 2015
50
40
30
20
10
0
-10
-20
Oil
Nuclear
Hydro
Renewables
Notes: Bloomberg New Energy Finance base case build forecasts; historical build from EIA Form 860
Michael Liebreich, New York, 14 April 2015
2020
2019
2018
2017
2016
2015
2014
Gas
2013
2011
Coal
2012
2010
2009
2008
-30
Other
Source: Bloomberg New Energy Finance
@MLiebreich
#BNEFSummit
55
CHINA COAL CONSUMPTION, 2000-14 (MILLION TONS)
3,000
2,500
2,000
1,500
1,000
500
0
2000
2002
2004
2006
2008
2010
2012
2014
Source: Bloomberg New Energy Finance, Chinese Government
Michael Liebreich, New York, 14 April 2015
@MLiebreich
#BNEFSummit
56
CONFESSIONS OF A COAL TRADER
In the old world, I’m selling
whale oil.
In the developing world,
I’m selling crack cocaine.
Anonymous
coal trader
Michael Liebreich, New York, 14 April 2015
@MLiebreich
#BNEFSummit
57
ARA AND NEWCASTLE COAL PRICE 2007–15
300
(2014 US$/TONNE)
300
250
250
200
200
150
ARA
150
Newcastle
100
100
50
50
0
2007
0
2007
2008
2008
2009
2009
2010
2010
2011
2012
2011
2013
2012
Note: Prices have been adjusted for inflation
Michael Liebreich, New York, 14 April 2015
2014
2013
2014
Source: Bloomberg New Energy Finance
@MLiebreich
#BNEFSummit
58
NEX CLEAN ENERGY INDEX 2013–15 YTD
200
150
S&P 500 Oil & Gas
NEX
100
Stowe Global Coal
50
0
Jan 13
Apr 13
Jul 13
Oct 13
Jan 14
Apr 14
Jul 14
Oct 14
Jan 15
Note: Values as of 01 April 2015; Stowe and S&P 500 rebased to 100 on 01 Jan 2013
Michael Liebreich, New York, 14 April 2015
Apr 15
Source: Bloomberg New Energy Finance
@MLiebreich
#BNEFSummit
59
PARIS COP 21 – DECEMBER 2015
Michael Liebreich, New York, 14 April 2015
@MLiebreich
#BNEFSummit
60
EMERGING COMMITMENTS FOR COP21 IN PARIS
(MTCO2E)
US
15,000
China
15,000
2030 target
trajectory
2025 target
trajectory
10,000
10,000
2020 target
level
2020 target
trajectory
5,000
5,000
Historical
emissions
0
1990
1995
2000
2005
2010
2015
2020
2025
0
1990
2030
EU
15,000
Historical
emissions
1995
2000
2005
2010
2015
2020
2025
2030
Japan
15,000
2030 target
trajectory
10,000
2030 target
trajectory
10,000
2020 target
trajectory
5,000
2020 target
trajectory
5,000
Historical
emissions
0
Historical
emissions
0
1990
1995
2000
2005
2010
2015
2020
2025
2030
1990
1995
2000
2005
Notes: Countries’ inclusion of land-use and forestry in emissions calculations vary. China’s 2020 target estimated from
announced emissions intensity target per unit GDP, and no absolute emissions level set for its 2030 pledge.
Michael Liebreich, New York, 14 April 2015
@MLiebreich
2010
2015
2020
2025
2030
Source: Bloomberg New Energy Finance,
UNFCCC
#BNEFSummit
61
GRID DEFECTION – I DON’T THINK SO
Defect?
● Distribution charges
● Resilience
(black-out)
● Sense of
independence
Don’t defect?
● System right-sizing
● Sale of surplus power
● Resilience
(back-up)
● System management
and maintenance
Source: Bloomberg New Energy Finance
Michael Liebreich, New York, 14 April 2015
@MLiebreich
#BNEFSummit
62
GRID DEFECTION?
Having a solar panel that isn’t
connected to the grid is like
having a computer that’s not
connected to the Internet.
Ellen Hayes, PG&E
spokeswoman
Picture: Ellen Hayes
Michael Liebreich, New York, 14 April 2015
@MLiebreich
#BNEFSummit
63
COMPOSITION OF RESIDENTIAL ELECTRICITY TARIFFS
ACROSS THE WORLD, 2008-2014 (EUR/MWh)
400
New South Wales (Aus)
UK
400
400
300
300
300
200
200
200
100
100
100
0
0
0
2010
2011
2012
2013
2009 2010 2011 2012 2013 2014
200920102011201220132014
Spain
Germany
400
400
300
300
200
200
100
100
0
0
2008 2009 2010 2011 2012 2013
Denmark
Other
Network costs
Wholesale power
2008 2009 2010 2011 2012 2013
Note: Other includes taxes, levies, carbon costs, profits
Michael Liebreich, New York, 14 April 2015
Source: Australian Energy Regulator, Eurostat Bloomberg New Energy Finance
@MLiebreich
#BNEFSummit
64
POWER SYSTEM VALUE CHAIN
Extraction
Generation
Michael Liebreich, New York, 14 April 2015
Transmission
Distribution
@MLiebreich
Demand
#BNEFSummit
65
POWER SYSTEM VALUE CHAIN
Old world
Extraction
Generation
Transmission
Distribution
Demand
$$$
Michael Liebreich, New York, 14 April 2015
@MLiebreich
#BNEFSummit
66
POWER SYSTEM VALUE CHAIN
Old world
Extraction
Generation
Transmission
Distribution
Demand
Transmission
Distribution
Demand
$$$
Age of plenty
Extraction
Generation
Michael Liebreich, New York, 14 April 2015
@MLiebreich
#BNEFSummit
67
POWER SYSTEM VALUE CHAIN
Old world
Extraction
Generation
Transmission
Distribution
Demand
$$$
$$$
Age of plenty
Extraction
Generation
Michael Liebreich, New York, 14 April 2015
Transmission
Distribution
@MLiebreich
Demand
#BNEFSummit
68
POWER SYSTEM VALUE CHAIN
Old world
Extraction
Generation
Transmission
Generation
Michael Liebreich, New York, 14 April 2015
Demand
$$$
Age of plenty
Extraction
Distribution
Transmission
Distribution
@MLiebreich
Demand
#BNEFSummit
69
POWER SYSTEM VALUE CHAIN
Old world
Extraction
Generation
Transmission
Generation
Michael Liebreich, New York, 14 April 2015
Demand
$$$
Age of plenty
Extraction
Distribution
Transmission
Distribution
@MLiebreich
Demand
#BNEFSummit
70
EON SPLIT
Michael Liebreich, New York, 14 April 2015
@MLiebreich
#BNEFSummit
71
ENERGY RETAIL BATTLEFIELD
NEW ENTRANTS - STARTUPS
Solar PV and
energy monitoring
Load
disaggregation
Heating controls
Smart thermostats,
home automation
Smart
thermostats
Behavioural
engagement
Smart
thermostats
Load disaggregation
Connected home
/ IoT
HEM tools
Source: Bloomberg New Energy Finance
Michael Liebreich, New York, 14 April 2015
@MLiebreich
#BNEFSummit
72
ENERGY RETAIL BATTLEFIELD
NEW SERVICES FROM INCUMBENTS
Integrated smart homes
HIVE home
heating
controls
Residential
energy
storage
HEM tools
and DR
Smart home
partnerships/investment
Smart
thermostats and
‘behavioural’ DR
IHD and smart
thermostat
program
BEMS for DR
and energy
efficiency
Smart lighting
/ home
automation
Smart thermostats
and load
disaggregation
Virtual mobile
operator – 80k
customers
Smart
thermostats to
reduce churn
Home energy
management
Source: Bloomberg New Energy Finance
Michael Liebreich, New York, 14 April 2015
@MLiebreich
#BNEFSummit
73
ENERGY RETAIL BATTLEFIELD
NEW ENTRANTS - MAJORS
Smart home
hubs
DR and retail
services
Home automation
Nest
acquisition
Energy supply and
services
Home
automation
Registered
energy supplier
HEMS
platform
Home
automation
HomeKit
Digital Life
connected
home service
Smart home
platform (AT&T)
1m connected
home customers
Source: Bloomberg New Energy Finance
Michael Liebreich, New York, 14 April 2015
@MLiebreich
#BNEFSummit
74
ENERGY RETAIL BATTLEFIELD
NEW SERVICE BUNDLES
Bundled telecoms and
energy
Bundled electricity,
entertainment and
home automation
Bundled telecoms,
energy. Residential
energy storage.
Bundled telecoms,
electricity supply
beginning in 2016
Bundled telecoms,
electricity and gas
Bundled insurance,
telecoms and energy
Bundled electricity
telecoms services
Source: Bloomberg New Energy Finance
Michael Liebreich, New York, 14 April 2015
@MLiebreich
#BNEFSummit
75
ENERGY RETAIL BATTLEFIELD
HEM tools
and DR
Bundled electricity,
entertainment and
home automation
HIVE home
heating
controls
Residential
energy
storage
Bundled telecoms and
energy supply
Smart home
hubs
Registered
energy supplier
Energy supply and
services
Smart home
partnerships/investment
???
1m connected
home customers
IHD and smart
thermostat
program
Smart
thermostats to
reduce churn
Digital Life
connected
home service
Smart lighting
/ home
Smart home
automation
platform
(AT&T)
BEMS for DR
and energy
efficiency
Bundled telecoms,
electricity supply
beginning
2016
DRinand
retail
services
HEMS
platform
Virtual mobile
operator – 80k
customers
Bundled insurance,
telecoms and energy
Bundled electricity
telecoms services
Home energy
management
Michael Liebreich, New York, 14 April 2015
@MLiebreich
#BNEFSummit
76
APPLE’S SOLAR SHOPPING SPREE
$850 million
Over 25 years
Michael Liebreich, New York, 14 April 2015
@MLiebreich
#BNEFSummit
77
SELECTED COMMERCIAL BUILDERS OR BUYERS OF
RENEWABLE ENERGY
Images: Various; Bloomberg New Energy Finance
Michael Liebreich, New York, 14 April 2015
@MLiebreich
#BNEFSummit
78
CLEAN VS FOSSIL ENERGY INVESTMENT
($BN)
600
600
500
500
400
400
-7%
35%
300
300
12%
7%
Expected
-8% 12%
Large hydro
Other
-9%
Solar
27%
200
200
Wind
50%
30%
100
100
00
20042005
20052006
20062007
20072008
20082009
20092010
20102011
20112012
20122013
201320142015
20142015Q1
Q1
2004
Note: Nominal values. Renewable energy includes large hydro, investment made at financial close. Fossil fuel is gross investment on coal, gas and oil capacity. We assume
capacity retirement of 3.3%/yr for coal, 4%/yr for gas and 2.5%/yr for coal in all countries where fossil capacity is net positive. We assume retiring capacity is replaced in
countries where fossil fuel capacity additions are net positive and not where additions are zero or negative. We count fossil fuel investment in the year when capacity was
commissioned (owing to a lower visibility of data). Q1 2015 figures do not include corporate & governmnet R&D, or EST asset finance estimates which are compiled on an
annual basis only.
Michael Liebreich, New York, 14 April 2015
@MLiebreich
Source: Bloomberg New Energy Finance
#BNEFSummit
79
YIELD ON 30-YEAR BONDS, 1977-2015 (%)
16
US
14
12
Eurozone
10
UK
8
Japan
6
Italy
4
Germany
2
0
1977
France
1982
1987
1992
1997
2002
2007
Note: This shows the percentage yield of 30 year generic government bond rates downloaded on 09/04/2015 from the
Bloomberg Terminal
Michael Liebreich, New York, 14 April 2015
@MLiebreich
2012
Source: Bloomberg New Energy Finance
#BNEFSummit
80
CAVEAT – GREXIT
Photo: ZDF / Jan Böhmermann?
Michael Liebreich, New York, 14 April 2015
@MLiebreich
#BNEFSummit
81
GREEN BOND ISSUANCE, 2007-14
($BN)
90
80
70
ABS
60
Project
50
US municipal
40
30
Labelled
corporate
20
Supranational,
sovereign &
agency
10
0
2007
2008
2009
2010
2011
2012
2013
2014
2015e
Source: Bloomberg New Energy Finance,
Bloomberg Terminal
Michael Liebreich, New York, 14 April 2015
@MLiebreich
#BNEFSummit
82
GREEN BOND ISSUANCE, 2007-14
($BN)
90
80
70
ABS
60
Project
50
US municipal
40
30
Labelled
corporate
20
Supranational,
sovereign &
agency
10
0
2007
2008
2009
2010
2011
2012
2013
2014
2015e
Source: Bloomberg New Energy Finance,
Bloomberg Terminal
Michael Liebreich, New York, 14 April 2015
@MLiebreich
#BNEFSummit
83
EMISSIONS TRADING SCHEMES, 2015
EU ETS
Quebec
Republic of Korea
???Ca ETS
Switzerland
Kazakhstan
RGGI
300 Gt
CO2/year
Operating
Tokyo
7x Chinese pilot
projects
New Zealand
Note: The size of each circle is proportional to GHG emissions covered. Based off the CA ETS covering 334 million tonnes of
CO2 per year as of 2015
Michael Liebreich, New York, 14 April 2015
@MLiebreich
Source: IEA, Bloomberg New Energy Finance
#BNEFSummit
84
EMISSIONS TRADING SCHEMES, 2015
Russia
Ukraine
Ontario
EU ETS
Manitoba
National Chinese
System
Quebec
Republic of Korea
British
Columbia
???Ca ETS
Switzerland
Turkey
National Japanese
system
Kazakhstan
Tokyo
RGGI
Thailand
Mexico
Brazil
300 Gt
CO2/year
Operating
Under
consideration
7x Chinese pilot
projects
Rio de
Janiero
Sao Paulo
Chile
New Zealand
Note: The size of each circle is proportional to GHG emissions covered. Based off the CA ETS covering 334 million tonnes of
CO2 per year as of 2015
Michael Liebreich, New York, 14 April 2015
@MLiebreich
Source: IEA, Bloomberg New Energy Finance
#BNEFSummit
85
CLEAN VS FOSSIL ENERGY INVESTMENT
($BN)
600
600
500
500
400
400
-7%
35%
300
300
12%
7%
Expected
-8% 12%
Large hydro
Other
-9%
Solar
27%
200
200
Wind
50%
30%
100
100
00
20042005
20052006
20062007
20072008
20082009
20092010
20102011
20112012
20122013
201320142015
20142015Q1
Q1
2004
Note: Nominal values. Renewable energy includes large hydro, investment made at financial close. Fossil fuel is gross investment on coal, gas and oil capacity. We assume
capacity retirement of 3.3%/yr for coal, 4%/yr for gas and 2.5%/yr for coal in all countries where fossil capacity is net positive. We assume retiring capacity is replaced in
countries where fossil fuel capacity additions are net positive and not where additions are zero or negative. We count fossil fuel investment in the year when capacity was
commissioned (owing to a lower visibility of data). Q1 2015 figures do not include corporate & governmnet R&D, or EST asset finance estimates which are compiled on an
annual basis only.
Michael Liebreich, New York, 14 April 2015
@MLiebreich
Source: Bloomberg New Energy Finance
#BNEFSummit
86
CLEAN VS FOSSIL ENERGY INVESTMENT
($BN)
600
600
500
500
400
400
-7%
-8% 12%
7%
600
-15%
35%
300
300
-9%
12%
500
27%
200
200
50%
400 30%
100
100
300
00
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 20142015 Q1
200 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 20142015 Q1
Note: Nominal values. Renewable energy includes large hydro, investment made at financial close. Fossil fuel is gross investment on coal, gas and oil capacity. We assume
capacity retirement of 3.3%/yr for coal, 4%/yr for gas and 2.5%/yr for coal in all countries where fossil capacity is net positive. We assume retiring capacity is replaced in
countries where fossil fuel capacity additions are net positive and not where additions are zero or negative. We count fossil fuel investment in the year when capacity was
commissioned (owing to a lower visibility of data). Q1 2015 figures do not include corporate & governmnet R&D, or EST asset finance estimates which are compiled on an
annual basis only.
100
Michael Liebreich, New York, 14 April 2015
@MLiebreich
Expected
Large hydro
Other
Solar
Wind
Expected
Large hydro
Other
Solar
Wind
Source: Bloomberg New Energy Finance
#BNEFSummit
87
CLEAN VS FOSSIL ENERGY INVESTMENT
($BN)
600
600
500
500
Capex of top 20 quoted oil
and gas companies plus top
20 quoted coal companies
400
400
-7%
-8% 12%
7%
600
-15%
35%
300
300
-9%
12%
500
27%
200
200
50%
400 30%
100
100
300
00
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 20142015 Q1
200 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 20142015 Q1
Note: Nominal values. Renewable energy includes large hydro, investment made at financial close. Fossil fuel is gross investment on coal, gas and oil capacity. We assume
capacity retirement of 3.3%/yr for coal, 4%/yr for gas and 2.5%/yr for coal in all countries where fossil capacity is net positive. We assume retiring capacity is replaced in
countries where fossil fuel capacity additions are net positive and not where additions are zero or negative. We count fossil fuel investment in the year when capacity was
commissioned (owing to a lower visibility of data). Q1 2015 figures do not include corporate & governmnet R&D, or EST asset finance estimates which are compiled on an
annual basis only.
100
Michael Liebreich, New York, 14 April 2015
@MLiebreich
Expected
Large hydro
Other
Solar
Wind
Expected
Large hydro
Other
Solar
Wind
Source: Bloomberg New Energy Finance
#BNEFSummit
88
CLEAN ENERGY CAPITAL REQUIREMENT TO 2030
($BN)
800
700
600
500
400
300
200
100
0
2004
2006
2008
2010
2012
2014
2016
2018
2020
2022
2024
2026
2028
2030
Source: New Energy Finance Global Futures 2008, Bloomberg New Energy Finance
Michael Liebreich, New York, 14 April 2015
@MLiebreich
#BNEFSummit
89
CLEAN ENERGY CAPITAL REQUIREMENT TO 2030
($BN)
800
700
600
?
500
400
300
200
100
0
2004
2006
2008
2010
2012
2014
2016
2018
2020
2022
2024
2026
2028
2030
Source: New Energy Finance Global Futures 2008, Bloomberg New Energy Finance
Michael Liebreich, New York, 14 April 2015
@MLiebreich
#BNEFSummit
90
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