Advantage Energy: Emerging economies, developing countries and the private-public sector interface

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1 Advantage Energy: Emerging economies, developing countries and the private-public sector interface USAEE Conference North America Conference David Elzinga 10 October 2011 OECD/IEA 2010

2 Who is the IEA? 1/2 International Energy Agency Formed in 1974 with the mandate to promote energy security through collective response to oil supply disruptions and authoritative research and analysis on energy for its 28 member countries Today our overall efforts can be summarised by: Energy Security, Environmental protection, Economic growth and Engagement worldwide

3 Who is the IEA? 2/2 28 Member Countries Asia Pacific: Australia, Japan, Republic of Korea and New Zealand North America: United States, Canada Europe:Austria, Belgium, Czech Rep, Denmark, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Luxembourg, Netherlands, Norway, Poland, Portugal, Slovak Republic, Spain, Sweden, Switzerland, Turkey and United Kingdom, European Commission also participates in the work of the IEA Headquarters: Paris Decision-making body: Governing Board Staff of around 220, mainly energy experts and statisticians from member countries

4 Energy systems approach what is it? The term energy system,refers to the totality of components that contribute to delivering energy services to end-users. In general, an energy system can be organised in the following manner: Energy sources including fossil fuels, renewable energy and nuclear. Distribution and conversion including pipelines and shipping, electricity transmission and distribution networks. Energy uses such as transport, lighting, refrigeration, cooling, smelting and refining.

5 Why is this approach important? Provides framework for detailed assessments: the needs, pathways and stakeholders for the different energy subsystems vary widely especially on a regional basis A holistic approach can identify synergies between the energy sub-systems All energy sub-systems contribute to the development agenda, but lack exposure in some circles A one size fits all does not apply

6 Global final energy use Includes all sectors of energy use

7 Heat This distribution of heat is highly dispersed and often decentralised, making it difficult to analyse. Needs differ broadly in application high temperature applications for industry to low-temperature applications for space heating. Successful applications to industry do not necessarily benefit general population

8 Electricity (1/2) Growth in general demand and increased use of electricity is seen in all regions globally in heating and transport Typically a highly regulated environment with significant changes to approaches over the last 20 years Technologies for access: Rural applications: Individual home solar installations Micro-or mini-grids, installed with electricity storage technology or in combination with fossil fuel generators. Urban: Construction, extension and reparation of national transmission and distribution (T&D) systems -addressing rural applications strategically Technologies for efficiency: Large-scale generation can be improved through off-the-shelf technologies and improved operations and maintenance. Technical losses and theft in T&D can be greatly reduced through smart-grid technology deployment. Technologies for End-use Typically a global market and standards are key for efficiency

9 Electricity (2/2) Renewable energy will play a large role in addressing access to electricity issues Renewable generation in the BLUE Map scenario for key countries and regions, 2050

10 Transport A range of technologies and forms of mobility will be important to sustainable transport: Public transit (such as light rail and bus rapid transit) Non-motorised transport (especially in regions that are unlikely to experience high car ownership levels), Improved vehicle fuel economy, adoption of electric and plug-in hybrid electric vehicles (EV/PHEVs), and Wider use of biofuels. EV/plug in hybrid vehicle sales by region, IEA BLUE Map Scenario

11 Public/private sector interface Recent experience shows that with effective policies and adequate financing, the private sector will seize the opportunity to deliver more sustainable energy options to growing consumer markets. UN Global Compact (UNGC) presents the following approach: Core business activities Social investments and philanthropy Advocacy and public policy engagement. The type of private sector organisation and involvement will be influenced by the technologies being deployed. Technologies with potentially large and diffuse markets, global corporations could support business development and supply chain management, while local businesses could be active in sales, deployment and education. Bus rapid transit (BRT) systems, public/private partnerships will be essential to ensure adequate financing and long-term operational strategies that include capacity building and education. Advocacy in policy development in areas including electricity market structures can ensure that customers have the ability to pay for electricity services when offered.

12 Key Messages Failure to articulate end uses clearly in discussions of energy access often leads to incorrect assumptions and misunderstandings The overall energy system can be broken into the key subsystems of: heat, electricity and transport All energy subsystems contribute to the development agenda and the expected growth in these regions links to global climate and energy security issues A systems approach encourages holistic thinking within each subsystem and helps identify cross-cutting interactions Next steps: Sets of roadmaps on specific systems and applications could be developed (already happening in some cases) Further engagement with and commitments from both public and private sector are needed

13 Thank you