Wind Perspectives in Latin America

Transcription

1 Wind Perspectives in Latin America IASS 2012, Potsdam, Germany Marcelo Tokman, Vice-President, Vestas South America October, 2012

2 About Vestas 1 Bienvenue

3 About Vestas Taking wind to the world (50 GW) In the Region, for the Region Relentlessly committed to wind 7 Sales Divisions Wind, Oil and Gas expresses the ambition of making wind an energy source on a par with fossil fuels. 46,143 turbines installed 69 countries 5,836 musd revenue 50 m CO2 saved / year 12,9% share of global deliveries 2011 (Ranked 1 st ) 20% share of acc. Installed capacity (Ranked 1 st ) A turbine for every wind type and location and technology leadership Vestas Technology R&D and Test Centres Industry s largest R&D and test centres Vestas Performance & Diagnostics Largest set of wind turbine data (real-time 21,500 turbines corresponding to 16 % of global base) V MW V90 3 MW V MW V112 3 MW Next generation Offshore Vestas Siting Industry s broadest wind and siting capabilities

4 About Vestas Presence in Latin America (1) Vestas Argentina In Buenos Aires since 1992 Vestas Brazil In Sao Paulo since 2007 Vestas Chile In Santiago de Chile since 2010 Vestas Mexico In Mexico City since 2010

5 About Vestas Presence in Latin America (2) More than 2,000 MW in operation or under construction in Argentina, Aruba, Brazil, Chile, Costa Rica, Cuba, Dominican Republic, Jamaica, México, Nicaragua, Peru and Uruguay. Canela I, Chile Oaxaca I, México Sierra de los Caracoles I, Uruguay Alegría, Brasil Rawson I & II, Argentina Cabo Negro, Chile La Fe San Martin, Nicaragua

6 The driving forces behind renewables in Latin America 2

7 The driving forces behind renewables in Latin America High growth economies (1) Expected growth of power generation LAC TWh Electric demand could 900 grow by 84% between y el WEO 2011 Current Policies Scenario

8 The driving forces behind renewables in Latin America High growth economies (2) KWh per capita consumption OECD versus LAC (2010) KWh Per Capita OECD Latin America Source: IEA Key Statistics 2012

9 The driving forces behind renewables in Latin America Supply risks (external dependency) Net Energy exports LAC by country (2010) SIEE-OLADE 2010

10 The driving forces behind renewables in Latin America Supply risks (external dependency) Interdependency: Argentina - Chile (Gas) Restrictions of natural gas from Argentina to Chile Bolivia - Brazil (Gas) Bolivia - Argentina (Gas) Argentina - Brazil (Elec.) Argentina - Uruguay (Elec.) Brazil - Uruguay (Elec.) Peru - Ecuador (Elec.) Colombia - Ecuador (Elec.) SIEPAC (Elec.) Source: CNE

11 The driving forces behind renewables in Latin America Supply risks (hydroelectric) Lots but of risky potential Source: SIEE-OLADE 2010, Systep, 2012

12 The driving forces behind renewables in Latin America Cost variability Mean : US$ 90 per barrel Coefficient of Variation: 25% Correlation: 75% Mean : US$ 108 per MT Coefficient of Variation: 26% Source: index mundi

13 The driving forces behind renewables in Latin America Rising fossil fuels prices Expected price per Barrel IEA (US$) Average Brent 2012: US$ 112 Source: IEA World Energy Outlook 2010 y 2011; Index Mundi

14 The driving forces behind renewables in Latin America Cost reduction Spot Wind Price Turbine c-si Price modules Index ($/W) 30% 50% Source: Bloomberg New Energy Finance (BNEF) 2012

15 The driving forces behind renewables in Latin America Increased cost competitivety Levelised cost of energy (USD/MWh) Fuente: Bloomberg New Energy Finance (BNEF) LCOE model as of Q4 2011

16 The driving forces behind renewables in Latin America The region has great resources

17 The driving forces behind renewables in Latin America Sustainability (1) Sustainability considerations Heavy carbon footprint could hurt competitivity (exports) Carbon intensity to sales (Ton CO2/ 000 USD)

18 The driving forces behind renewables in Latin America Sustainability (2) Public acceptance creates further opportunity Source: Vestas-TNS Gallup Global Consumer WindStudy 2012; A New Era of Sustainability (UN Global Compact & Accenture) 2011

19 The driving forces behind renewables in Latin America Sustainability (3) Carbon based energy forms Nuclear Wind Non-wind renewables Life-cycle GHG emissions (g CO2-eq/kWh) Combined Cycle Gas Turbine (CCGT) CCGT + CO2 Coal Gasification + CO2 Nuclear Wind Biomass Solar Present Solar Future Source: Singapore IEW Conference Key Takeaways, November 2009

20 The driving forces behind renewables in Latin America Sustainability (4) Water consumed to produce five MWh of electricity: Energy power plant type Average water consumed (litres/5 MWh) Wind power 0 Solar PV 0 Gas+CCS, NGCC, Cooling tower Nuclear, Cooling tower Concentrated Solar Power, Parabolic Trough, Cooling tower Coal+CCS, Supercritical pulverized coal, Cooling tower PV Photovoltaic; CSP Concentrated Solar Power; NGCC Natural Gas Combined Cycle; CCS Carbon Capture and Storage; Source: DHI 2010, Harvard 2010, IEEE 2010, NREL 2003, Stillwell et al. 2009, US DoE 2006, US DoE 2009, WEC 2010, WEF 2009, WEF 2011, Western Resource Advocates 2008

21 The driving forces behind renewables in Latin America Sustainability (5)

22 The driving forces behind renewables in Latin America Renewables provide huge potential Renewables provide cost certainty They are becoming more competitive Increase energy security by reducing external dependence and exposure to hydrology Sustainable Low local impact Low Carbon footprint and publically accepted

23 Policies & regulation support deployment 23 3

24 Policies and regulation support deployment Adoption of necessary policies and regulation (1) Source: Bloomberg, 2012

25 Policies and regulation support deployment Adoption of necessary policies and regulation (2) Efforts continue in 2011 and 2012: During 2011 PPAs for 3.6 GW of renewable capacity were auctioned by the government. 3 GW went to wind power alone. Over > 6 GW of wind projects with awarded PPAs are in the pipeline. Government announced A3 y A5 auctions for October Bill to increase current RPS of 10% by 2024 to 20% by 2020 recently approved by Senate. Government has announced a number of initiatives to support renewables, including a new bill for transmission recently sent to Congress. Together with marginal costs above US$ 200 per MWh and increasingly competitive technologies have resulted in project for over 8 GW in environmental evaluation.. Announcements of new auctions by the government for long term PPAs and open seasons for the development of transmission in 2011 together with existing regulation to support self supply projects (energy bank) and tax incentives (accelerated depreciation) continue to promote wind power. Second auction for government backed PPAs for renewables in PPAs for 210 MW awarded (90 MW to wind power). Energy is sold at spot prices and the Government makes an annual balance between revenues that should have been perceived at awarded PPA price and compares it to actual revenues and pays deficits. Public Utility auctioned PPAs for 192 MW in PPA for another 450 MW for wind power are expected shortly. A process for operational leases 200 MW of wind power in place as well as direct contracts. Goal: 1.3 GW al Government auctioned PPAs for 50 MW of Wind Power in 2011 and 100 MW of Wind Power in Panamá government awarded in 2011 PPAs 153 MW of wind under its first auction for Wind Power.

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27 Results Healthy investment in renewables Investment in clean energy by country (US $ Billions) Source: Bloomberg, 2012

28 Results The picture today Installed renewable capacity LAC 22 GW (7.5%): Renewables 12% Renewables 5% 116 GW 17 GW Conventional 88% Conventional 95% Renewables 3% Renewables 23% 59 GW 11 GW Conventional 97% Conventional 77% Sources: Bloomberg, Climatescope 2012, Local Agencies 2010, 2011, 2012

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30 Wind takes the lead Auctions, the mechanism of choice MWs auctioned by technology and awarded PPA price in 2011 Solar $120 Small hydro $48 Brazil Peru Biomass 655 $72 Uruguay Panama Wind 3,006 $ ,000 1,500 2,000 2,500 3,000 3,500 4,000 Source: Bloomberg, 2012

31 Wind takes the lead Steady and strong investment growth Investment in clean energy by technology (US$ Billions) Source: Bloomberg, 2012

32 Wind takes the lead Costs are very competitive MWs by auction and average awarded PPA price (US $) in 2011 Source: Bloomberg, 2012

33 Wind takes the lead Growth to remain strong Expected installed capacity MWs renewsamericas GWEC

34 A few issues for discussion 6

35 A few issues for discussion Sustainability of low auction prices for wind power Brazil awarded PPAs for 6.7 GW awarded between 2009 and Of the MW built at the end of 2011, 90% under the Proinfa ( ) scheme provided significantly higher prices than those from the tenders (230 reales). Peru awarded PPAs in 2010 and 2011 for 4 projects for a total of 232 MW of Wind at an average price of $81 MWh and US$ 69 MWh, respectively, 0 MW are under construction. Uruguay awarded PPAs in 2011 for a 150 MW and 192 MW of Wind at an average price of US$ 84 MWh and US$ 63 MWh respectively. There are 150 MW under construction.

36 A few issues for discussion Access to financing Installed wind power capacity 132 MW. Government tender for 754 MW in 2010 Average price PPAs awarded US$127 MWh. Only one 77 MW project built under auction despite good prices. High country risk, currency controls and export controls. No access to public or private financing. PPAs for 6.7 GW auctioned between 2009 and Installed wind power capacity August GWs. BNDES soft loans are financing the vast majority of subject to a 60% local content requirements. In 2011 BNDES provided 80% of the $ 5.6 billion in new investments attracted by the wind industry. Installed wind power capacity 201 MW and 200 MW under construction. 5% RPS will scale up to 10% by Marginal prices above US$ 200 MWh provide price signal Robust local finance sector and low country risk allow for balance sheet financing and project finance. Initial public support through preferential financing lines

37 A few issues for discussion Transmission La Guajira in the isolated northern border of the country with Venezuela has several GWs of potential but a 190 km transmission line will be required. The 1 GW of installed wind power capacity in the Oaxaca region accesses transmission financed through Open Seasons carried out by the government. A bill was recently sent to Congress to create electric highway. One of its goals is to connect isolated renewable resource rich regions.

38 A few issues for discussion New players Antofagasta Minerals, Chile's largest mining group signs a PPA and takes equity stake in 115 MW wind farm. Project to start construction shortly. Codelco, worlds largest copper mining company, owns Chile s first Solar PV Power Plant and is looking into Wind. Arauco, one of worlds leading pulp company's announces it will invest in a 120 MW Wind farm in Chile. It also owns biomass power plants. Canadian gold mining company Barrick commissioned a 16 MW wind farm in the north of Chile. Worlds largest Methanol producer installed a 2.3 MW self supply wind farm in Punta Arenas, Chile. Engraw manufacturing facility, Uruguay Chilean glass bottle manufacturer built a 9 MW wind farm. Chilean sanitary built 9 MW biogas power plant. Uruguay s wool producer installed a single 1.8 Vestas WTG and became one of the first WindMade certified companies in the world.

39 A few issues for discussion Regulatory predictability Annual investments in Clean Energy in Chile (US$ millions) Source: Bloomberg Climatescope, 2012

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