Achieving our Energy Transformation Philippe Benoit Head of Energy Efficiency & Environment (Climate) Division, IEA

Transcription

1 Achieving our Energy Transformation Philippe Benoit Head of Energy Efficiency & Environment (Climate) Division, IEA GCCSI COP 19 Warsaw, 20 November, 2013 IEA 2013

2 Portfolio of decarbonising measures Emissions Reductions (Gt CO 2 ) Nuclear 8% (8%) End-use fuel switching 12% (12%) CCS 14% (17%) Renewables 21% (23%) Power generation efficiency and fuel switching 3% (1%) End-use fuel and electricity efficiency 42% (39%)

3 Portfolio of decarbonising measures Emissions Reductions (Gt CO 2 ) Nuclear 8% (8%) End-use fuel switching 12% (12%) CCS 14% (17%) Renewables 21% (23%) Power generation efficiency and fuel switching 3% (1%) End-use fuel and electricity efficiency 42% (39%)

4 Energy efficiency: a huge opportunity going unrealised Energy efficiency potential used by sector in the New Policies Scenario 100% 80% 60% Unrealised energy efficiency potential Realised energy efficiency potential 40% 20% Industry Transport Power generation Buildings Two-thirds of the economic potential to improve energy efficiency remains untapped in the period to 2035 OECD/IEA 2012

5 Market failures impede EE investment Principal-Agent Problems Moral Hazard Split Incentives Split Incentives Energy Market Failures (Externalities) Asymmetric Information Moral Hazard Adverse Selection Imperfect Information Behavioural Failures (Bounded Rationality)

6 25 EE Policy Recommendations Cross-sectoral 1. Energy efficiency data collection and indicators 2. Strategies and action plans 3. Competitive energy markets with appropriate regulation 4. Private investment in energy efficiency 5. Monitoring, enforcement and evaluation of policies and measures Buildings 6. Mandatory building energy codes and minimum energy performance requirements; 7. Aiming for net zero energy consumption in buildings 8. Improving the energy efficiency of existing buildings 9. Building energy labels or certificates 10. Improved energy performance of building components and systems Appliances and Equipment 11. Mandatory MEPS and labels for appliances and equipment 12. Test standards and measurement protocols for appliances and equipment 13. Market transformation policies for appliances and equipment Lighting 14. Phase-out of inefficient lighting products and systems 15. Energy efficient lighting systems Transport 16. Mandatory vehicle fuel efficiency standards 17. Measures to improve vehicle fuel efficiency 18. Fuel-efficient non-engine components 19. Improved vehicle operational efficiency through Eco-driving and other measures 20. Transport system efficiency Industry 21. Energy Management in industry 22. High efficiency industrial equipment and systems 23. Energy efficiency services for small and medium enterprises 24. Complementary policies to support industrial energy efficiency Utilities and end-use 25. Energy Utilities and end-use energy efficiency

7 Climate policies to address market failures Price of CO 2 /tco 2 e MtCO 2 Carbon pricing mechanisms

8 Market failures require policies Effective policies are key but is more needed?

9 Multiple benefits of EE Enterprise productivity Energy provider benefits Asset values Sector-wide National Public budgets Disposable income Macro impacts Poverty alleviation Job creation Energy efficiency improvement Health & wellbeing Individual Energy security Energy savings Development International Resource management Energy prices Climate change mitigation

10 Different strokes for different folks Benefits vs. Co-Benefits Multiple Benefits Industrial Competitiveness Country or Stakeholder A Cty/Stk B Ctry/Stk C Etc. Co-Benefit Fuel Imports Primary Co-Benefit Poverty Alleviation and Development GHG Emissions Primary Primary Co-Benefit Job Creation Co-Benefit Co-Benefit Local pollution Primary Co-Benefit

11 IEA fuel market reports

12 EE keeps producing Energy Efficiency We need to keep measuring EE output year after year after year and make this more apparent

13 EJ Mtoe EE: IEA s first fuel? Hypothetical energy use had there been no energy efficiency improvements Avoided energy equal to 65% of 2010 TFC Total final Consumption (TFC) Coal Oil Gas Electricity Other Avoided energy use TFC IEA EEMR 2013

14 EE: largest resource in 2010 (in IEA 11) EJ Mtoe IEA EEMR 2013 Oil Electricity Gas Coal Other Avoided energy use 0

15 Portfolio of decarbonising measures Emissions Reductions (Gt CO 2 ) Nuclear 8% (8%) End-use fuel switching 12% (12%) CCS 14% (17%) Renewables 21% (23%) Power generation efficiency and fuel switching 3% (1%) End-use fuel and electricity efficiency 42% (39%)

16 Portfolio of decarbonising measures Emissions Reductions (Gt CO 2 ) Nuclear 8% (8%) End-use fuel switching 12% (12%) CCS 14% (17%) Renewables 21% (23%) Power generation efficiency and fuel switching 3% (1%) End-use fuel and electricity efficiency 42% (39%)

17 Renewable power doing well 42% Solar PV capacity growth % Wind capacity growth 2012 Tracking Clean Energy Progress IEA CEM Report, 2013

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19 Challenges to Continued Growth C Policy Uncertainties/ stop-and-go

20 Multiple benefits of renewables...

21 New global capacity in power generation: Renewables... and fossil fuels Fossil fuels Renewables

22 Lock-In of 2 degree Emissions Gt Other Transport Industry 2 C trajectory Room to manoeuvre 10 5 Power generation Lock-in of existing infrastructure OECD/IEA 2012 Planned fossil fuel infrastructure through 2017 will generate all energy emissions under 2DS through 2035

23 Over the long-term... Renewables + energy efficiency insufficient

24 Portfolio of decarbonising measures Emissions Reductions (Gt CO 2 ) Nuclear 8% (8%) End-use fuel switching 12% (12%) CCS 14% (17%) Renewables 21% (23%) Power generation efficiency and fuel switching 3% (1%) End-use fuel and electricity efficiency 42% (39%)

25 Portfolio of decarbonising measures Emissions Reductions (Gt CO 2 ) Nuclear 8% (8%) End-use fuel switching 12% (12%) CCS 14% (17%) Renewables 21% (23%) Power generation efficiency and fuel switching 3% (1%) End-use fuel and electricity efficiency 42% (39%)

26 CCS: major abatement potential Global

27 CCS is part of a cost-effective response Additional USD 36 trillion in investments through 2050 to reach 2DS scenario goals CCS is 10% of this 3.6 CCS Other clean energy 36.4 and if CCS not available for power, investment required in the power sector will increase by 40%

28 Fossil fuels dominate through 2050 Fossil fuels have a role in all IEA scenarios Mtoe DS DS DS even under the ambitious 2DS scenario. Mtoe

29 A roadmap forward...

30 7 key actions for next 7 years 1. Introduce financial support mechanisms for demonstration and early deployment 2. Develop laws and regulations that effectively require new-build power capacity to be CCS-ready 3. Significantly increase efforts to improve understanding among the public and stakeholders of CCS technology 4. Implement policies that encourage storage exploration, characterisation and development for CCS projects 5. Reduce the cost of electricity from power plants equipped with capture through continued technology development 6. Prove capture systems at pilot scale in industrial applications 7. Encourage efficient development of CO 2 transport infrastructure

31 Support strategies for CCS Increase familiarity among Sponsors and Financiers

32 CCS is ready for scale-up Assembling the parts still a challenge Post-process capture Syngas/hydrogen capture Oxy-fuel combustion Inherent separation 6000km existing pipelines Existing technical standards Transport by ship (albeit in small quantities) Decades of research Natural CO 2 accumulations Pilot projects Existing large-scale projects Capture technologies are well understood but expensive. Transport is the most technically mature step in CCS. CO 2 storage has been demonstrated but further experience is needed at scale.

33 Strengthen outreach to the Public Carbon dioxide Methane

34 Burden sharing : moving upstream to fossil fuels?

35 Funding CCS from fossil fuels 1. Total use of fossil fuels under IEA 2DS : EJ Coal 28% Mtce Oil 39% Mtoe Gas 33% MMbtu 2. Total CCS investment (undiscounted) USD Investment divided by unit of fossil fuel Coal Oil Gas USD 6.75 / tonne USD 1.38 / bbl ( 3 cents / gallon) USD 0.24 / MMbtu

36 Lower costs (e.g., through more RD&D)

37 Impact of CCS on levelised cost of electricity: Illustrative Levelised cost 2012 USD / MWh

38 CO 2 USE

39 Using CO 2 : further research CO 2 -EOR Industrial uses Source: GCCSI Source: NETL, USA EOR is a use that leads to verifiable geological storage if appropriately monitored and regulated Currently, it the only economic use of CO2 that has the potential to achieve scales that are meaningful in a climate sense Need research into the potential and viability of ideas for non-storage uses

40 Hundreds not Millions : a CCS supply curve

41 Cumulative mass captured (GtCO 2 ) CCS concentrated Ten largest countries/sectors could achieve 60% of CCS efforts.

42 Multiple benefits of CCS? C Enterprise productivit y Energy provider benefits Asset values Public budgets Disposable income Macro impacts Poverty alleviation Job creation Energy efficiency improvement Health & wellbein g Energy security Energy savings Developmen t Resource management Energy prices Climate change mitigatio n

43 AMBITION

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