ETP nd Webinar July 10, 2017 IEA OECD/IEA 2017

Transcription

1 Energy Technology Perspectives 2017 Catalysing Energy Technology Transformations Speakers: Jean Francois Gagne, Ellina Levina, Samantha McCulloch, Luis Munuera, John Dulac, Pierpaolo Cazzola, Adam Brown ETP nd Webinar July 10, 2017 IEA

2 Energy Technology Perspectives 2017 Catalysing Energy Technology Transformations Scene setting Jean Francois Gagne, Division Head, IEA ETP nd Webinar July 10, 2017 IEA

3 Key points of orientation Global energy markets are changing rapidly Renewables supplied half of global electricity demand growth in 2016, and increase in nuclear capacity reached highest level since 1993 Global energy intensity improved by 2.1% in 2016 Electric car sales were up 40% in 2016, a new record year The energy sector remains key to sustainable economic growth 1.2B people lack access to electricity; 2.7B people lack access to clean cooking Largest source of GHG emissions today, around two-thirds of global total Largest source of air pollution, linked to 6.5 million premature deaths per year There is no single story about the future of global energy Fast-paced technological progress and changing energy business models

4 The energy landscape has been shifting Shares in growth in world energy demand Nuclear 2% Renewables 12% Coal 10% Renewables 32% Gas 23% Coal 47% Oil 27% Oil 16% Nuclear 0% Gas 31% Since 2010, efficiency measures have slowed down growth in global energy consumption. Renewables and natural gas accounted for almost two-thirds of the growth.

5 Global CO 2 emissions flat for 3 years an emerging trend? Gt Global energy-related CO 2 emissions IEA analysis shows that global CO 2 emissions remained flat in 2016 for the third year in a row, even though the global economy grew, led by emission declines in the US and China.

6 How far can technology take us? GtCO 2 40 Reference Technology Scenario RTS Technology area contribution to global cumulative CO 2 reductions Global CO 2 reductions by technology area 2 degrees Scenario 2DS Beyond 2 degrees Scenario B2DS Efficiency 40% 34% Efficiency 40% Renewables Renewables 35% 15% 35% Fuel switching Fuel 5% switching 5% 18% Nuclear 6% Nuclear CCS 14% 6% 1% Gt CO 2 cumulative reductions in CCS 14% 32% Pushing energy technology to achieve carbon neutrality by 2060 could meet the mid-point of the range of ambitions expressed in Paris.

7 The potential of clean energy technology remains under-utilised Solar PV and onshore wind Energy storage Electric vehicles Nuclear Transport Fuel economy of light-duty vehicles Energy-intensive industrial processes Lighting, appliances and building equipment More efficient coal-fired power Carbon capture and storage Building construction Transport biofuels On track Accelerated improvement needed Not on track Recent progress in some clean energy areas is promising, but many technologies still need a strong push to achieve their full potential and deliver a sustainable energy future.

8 Can we push up the low-carbon power deployment pace? Average capacity additions in different periods in the B2DS Last year Last Decade GW per year Fossil CCS (Incl.BECCS) Nuclear Hydro Wind Solar PV Other renewables Recent successes in solar and wind will have to be extended to all low-carbon solutions, and brought to a scale never experienced before.

9 We need to produce materials more sustainably EJ Energy use and direct CO 2 emissions in various industrial sectors under different scenarios Other industries 10 Pulp and paper Aluminium Gt CO 2 Chemicals and petrochemicals 50 2 Cement RTS B2DS 0 Iron and steel Direct CO2 emissions Effective policies and public-private collaboration are needed to enable an extensive roll-out of energy and material efficiency strategies as well as a suite of innovative technologies.

10 Mt CO₂ Mt CO₂ A challenging task ahead for CCS Amount of CO 2 captured under various scenarios Rest of world EU IND CHN Today Today 2DS B2DS MEA USA CCS is happening today, but needs to be ramped up hundreds of times to achieve long-term goals. The role for CCS varies based on local circumstances.

11 USD (2016) billion Global clean energy RD&D spending needs a strong boost Global clean energy RD&D spending Top 3 IT company R&D spenders Mission Innovation Private Public Top 3 firms Global RD&D spending in efficiency, renewables, nuclear and CCS plateaued at $26 billion annually, Global RD&D spending in efficiency, coming renewables, mostly from nuclear governments. and CCS plateaued at $26 billion annually, Mission Innovation coming could mostly provide from a much governments. needed boost.

12 Conclusions Early signs point to changes in energy trajectories, helped by policies and technologies, but progress is too slow An integrated systems approach considering all technology options must be implemented now to accelerate progress Each country should define its own transition path and scaleup its RD&D and deployment support accordingly Achieving carbon neutrality by 2060 would require unprecedented technology policies and investments Innovation can deliver, but policies must consider the full technology cycle, and collaborative approaches can help

13 Energy Technology Perspectives 2017 The Global Outlook Samantha McCulloch, Eric Masanet ETP nd Webinar July 10, 2017 IEA

14 The Global Outlook Despite significant shifts in the global energy landscape, energy and climate commitments fall short of achieving long-term goals An optimised, cost-effective pathway to 2 C or below requires technology innovation across a portfolio of clean energy technologies Rapid and aggressive deployment of clean energy technologies could deliver a carbon-neutral energy system in 2060 However, this would require a fundamental and immediate shift in current action

15 Cumulative energy sector CO 2 budgets: 2DS and B2DS GtCO 2 20 GtCO Cumulative DS B2DS The 2DS requires around 740 GtCO 2 of cumulative emissions reductions to 2060, relative to the RTS Cumulative emissions are 36% lower in the B2DS compared with the 2DS

16 EJ Primary energy demand in the RTS and 2DS % % % % % Fossil Non-fossil Fossil Non-fossil 2060 RTS 2DS Biomass and waste Hydro Other renewables Nuclear Natural gas Oil Coal Share of fossil fuels 0% More than half of primary energy demand is from renewables in the 2DS The share of fossil fuels falls from 81% today to 35% in 2060 in the 2DS

17 Cumulative CO 2 emissions reductions by sector and technology: RTS to 2DS Transformation Renewables Buildings CCS Industry Fuel switching Transport Energy efficiency Power Nuclear GtCO 2 Action is required across all energy supply and demand sectors

18 Remaining CO 2 emissions in the 2DS and B2DS 40 2DS 40 B2DS GtCO GtCO The power sector is virtually decarbonised 10 by 2060; Industry (57%) 5 and transport (36%) are the largest sources of emissions in Other transformation Power Transport Industry Buildings Agriculture The remaining CO 2 emissions in industry and power must be targeted for the B2DS Negative emissions are necessary to achieve net-zero emissions in 2060

19 TWh gco 2 /kwh Electricity mix Global electricity generation in the B2DS Other 100% Wind STE Solar PV Biofuels and waste Hydro Nuclear Coal with CCS Coal Oil Natural gas with CCS Natural gas CO₂ intensity 80% 60% 40% 20% 0% 2DS B2DS Renewables Bioenergy with CCS Nuclear Fossil with CCS Fossil w/o CCS Global electricity generation is decarbonized by 2050 in the B2DS and becomes a source of negative emissions with significant deployment of BECCS

20 EJ Bioenergy and CCS (BECCS) plays a key role in the B2DS Bioenergy use by sector % 50% 40% 30% 20% 10% 0 RTS 2DS B2DS % Power Fuel transformation Agriculture Buildings Industry Transport % BECCS Around 145 EJ of sustainable bioenergy is available by 2060 in all our decarbonisation scenarios, but is used differently between the 2DS and the B2DS.

21 Bridging the 2DS gap: Policy actions A significantly strengthened and accelerated policy response is required for any low-emission scenario Overarching policy priorities: Enhanced support for technology innovation Alignment of long-term climate strategies and near-term policy action Improved integration of policy measures across the energy system

22 Accelerating the transition to sustainable buildings John Dulac and Thibaut Abergel ETP 2017 Webinar IEA

23 Global buildings status report Tracking Clean Energy Progress 2017 Despite some positive developments in the last two years, more assertive action is still needed to put the global buildings sector on track.

24 Change since 1990 EJ EJ Change since 1990 Building energy intensity is not dropping fast enough Building energy use and intensity per m 2 since OECD 150% 75 Non-OECD 150% % % 45 90% 45 90% 30 60% 30 60% 15 30% 15 30% % % Biomass (traditional) Coal Oil Natural gas Electricity Commercial heat Renewables Intensity reduction Floor area growth Global building energy intensity per m 2 improved at roughly 1.5% per year since 1990, but this was not enough to offset strong growth in buildings sector floor area at nearly 3% per year.

25 Additions to 2060 (billion m 2 ) Share of additions built by 2035 Floor area will increase sharply over the next 20 years Floor area additions to 2060 by key regions 60 60% 50 50% % 30% 20% Non-residential Residential Share of additions 10 10% 0 North America Europe China India ASEAN Africa Middle East Latin America 0% Floor area additions to 2060 will largely occur in developing countries. Half of global building additions will be completed by 2035.

26 especially in regions not covered by building energy codes Building energy code coverage, 2015 Swift action is needed to address building envelope performance over the next 20 years to avoid the lock in of energy intensive building investments, especially in developing regions.

27 EJ MWh per person Capturing the enormous energy efficiency potential in buildings Buildings final energy consumption by scenario and fuel type Renewables Commercial heat Electricity Natural gas Oil Coal Biomass (traditional) Energy intensity RTS 2DS B2DS Going from RTS to B2DS would save the equivalent of twice global energy production in 2014.

28 Average energy intensity improvement Locking in better buildings today Changes in global residential building stock and energy intensity to % nzebs % Renovated buildings Billion m % 30% 20% Improvement New construction 30 10% Renovated stock 0 RTS 2DS / B2DS RTS 2DS / B2DS RTS 2DS / B2DS 0% Global average High performance building construction and deep energy renovations of existing buildings play a critical role in reducing buildings sector energy demand.

29 EJ to avoid energy demand tomorrow Consequences of a ten year delay in achieving building envelope objectives 100 Cumulative loss by region (EJ) RTS B2DS Total heating nzeb and renovated buildings Other buildings Loss to delay loss 93 EJ 34 EJ Total cooling loss Eurasia 10 Other non-oecd 15 Other Asia 15 China 39 OECD 48 Delaying implementation and enforcement of building envelope measures would result in the equivalent of three years of additional energy consumption for heating and cooling in the buildings sector.

30 Transitioning to a low-carbon buildings sector Evolution of heating equipment in buildings to 2060 Inner to outer ring RTS 2DS B2DS Coal and oil boilers Gas boilers Efficient gas technologies Electric heat pumps Electric resistance District heat Solar thermal Efficient biomass The B2DS represents a strategic shift away from fossil fuel equipment to high efficiency and renewable technologies, such as heat pumps, solar thermal and modern district energy.

31 Reversing historical trends Decomposition of global final energy demand in buildings by key contribution Historical EJ Population Floor area Activity Envelope improvements Product performance Technology choice Others Annual energy change B2DS EJ Energy efficiency measures under the B2DS reverse historical trends, offsetting the effect of an increasing global population, building activity drivers and growing floor area in buildings.

32 in support of net-zero emissions by 2060 Key contributions to CO 2 emissions reduction in buildings 10 8 RTS Direct emissions reduction Gt CO2 6 4 Envelope improvement Technology performance DS B2DS Technology choice Indirect (power) More than 50% of cumulative CO 2 emissions reduction in buildings to 2060 under the B2DS results from shifts to low carbon and high performance technologies.

33 Policy strategies for a B2DS buildings sector Building construction & renovation Mandatory building energy codes for new and existing buildings Capacity building and training Financing schemes and market incentives Cooperation and knowledge sharing Transition to zero-carbon buildings Long-term, strategic vision for energy transition Phase-out of fossil fuel subsidies and other perverse incentives Assertive market frameworks Integrated, flexible district energy solutions Rapid energy efficiency deployment Minimum energy performance standards Labelling and awareness programmes Financing schemes and market incentives Support for market scale (e.g. bulk procurement) Technology innovation Supporting R&D beyond current BAT Cost reductions for critical technologies Integrated energy technology solutions Advances in clean energy technologies

34 Steering transport toward sustainability Pierpaolo Cazzola ETP nd Webinar July 10, 2017 IEA

35 Decarbonizing Transport is a formidable challenge Transport accounts for 28% of global final energy demand and 23% of global carbon dioxide (CO 2 ) emissions from fuel combustion. In 2014, the transport sector consumed 65% of global oil final energy demand. Decarbonising the sector requires: changing the nature and the structure of transport demand, major improvements in efficiency, and rapid transitions in the energy mix used to move people and goods. Decarbonising long distance transport modes in particular aviation, heavy duty road transport (i.e. trucking and buses) and shipping is most challenging. IEA 2017

36 GtCO2-eq Ambitious policy action is needed across all transport modes Well-to-wheel greenhouse gas emission reductions by mode RTS Shipping Aviation Rail Buses 6 4 2DS 2 B2DS Trucks Light-duty vehicles 2- and 3-wheelers WTW GHG emissions from transport are 89% lower in 2060 than in 2015 in the B2DS, while in the 2DS they decline by 54% over the same period. All modes must contribute to decarbonisation. IEA 2017

37 Measures are needed across the developed and developing world Well-to-wheel greenhouse gas emissions in OECD and non OECD countries by scenario, Achieving the B2DS target requires OECD countries to reduce WTW GHG emissions by 90% and non- OECD countries by 66% from 2015 levels by IEA 2017

38 Rapid electrification of light-duty fleet drives deep decarbonisation Global technology penetrations in LDV stock by scenario, Non-urban Urban By 2060, the share of alternative powertrain vehicles in the global LDV stock will reach 94% in the B2DS and 77% in the 2DS. IEA 2017

39 Battery cost (USD/kWh) Battery energy density (Wh/L) PHEV battery costs dropped by a factor of four and energy density increased more than fourfold from 2009 to Evolution of battery cost and energy density, Conventional lithium ion Advanced lithium ion Beyond litium ion US DOE battery cost (BEV) US DOE battery cost (PHEV) GM battery cost target (BEV) Tesla battery cost target (BEV) US DOE battery cost target (PHEV) US DOE energy density (PHEV) US DOE energy density (BEV) Potential 0 US DOE energy density target (PHEV) This trend and expected improvements from new battery chemistries being researched appear favourable for the targets set by carmakers and US DOE for 2020 and IEA 2017

40 PHEVs and BEVs become increasingly competitive with conventional technologies over time in the four regions in both scenarios. Comparative cost of PLDV technologies by country/region in the RTS and B2DS, 2015 and 2060 The Total Cost of Ownership (TCO) differential in favour of PEVs occurs sooner and is more substantial for vehicles that are driven more than average distances. IEA 2017

41 2-wheelers can go electric even faster, and provide an alternative to cars Share of 2-wheelers in major Asian regions and the OECD average in the B2DS, With rising average income levels, ownership levels of 2-wheelers in China, India and ASEAN countries decrease and ownership levels of PLDVs increase over time. IEA 2017

42 Major shifts from private cars to public transport Bus and rail activity by scenario and passenger transport activity by mode, Measures to shift and to avoid passenger transport result in a 25%-27% reduction in pkm on cars by 2060, relative to the RTS IEA 2017

43 In road freight, multiple measures are needed Systemic improvements - First solutions that can be developed without cooperation: route optimization, high capacity vehicles, driver training, last mile delivery optimization, platooning - Then solutions requiring data sharing, closer collaboration, including sharing of assets Vehicle technologies - First exploiting the energy efficiency of trucks - Then zero emission technologies (electricity, fuel cell) Alternative fuels and alternative truck powertrains - Biofuels, electricity or hydrogen - Natural gas ok for energy diversification and reduction of air pollutants, but it has limited capacity to reduce GHG contribution to 2DS & B2DS limited to biomethane IEA 2017

44 Global technology penetrations in truck stock by scenario, B2DS requires zero emission (electric or hydrogen) trucks IEA 2017

45 To curb aviation emissions, focus on efficiency and mode shift Energy intensity improvements in global aviation by scenario International aviation experiences strong activity growth and continuously improves fuel economy of the fleet in each scenario. IEA 2017

46 High-speed rail must substitute for intracontinental air travel Modal shift from aviation to HSR, RTS and B2DS Ambitious shifts from aviation to HSR are needed to reduce GHG emissions of aviation, a highly carbon-intensive mode of transport. IEA 2017

47 In international shipping, a broad portfolio of measures is needed WTW GHG emissions in international shipping in the B2DS relative to RTS The largest share of GHG abatement in shipping results from operational and technological efficiency improvement combined with wind assistance in the B2DS. IEA 2017

48 Expenditures on vehicles, infrastructure and fuels Cumulative investment needs by scenario, Decarbonising transport saves more than USD 100 trillion in the period to 2060, mostly from reduced expenditures on cars and fuel. IEA 2017

49 Key policies to decarbonise the transport sector Fuel taxes that reflect life-cycle GHG emissions intensities Regulatory measures, including in particular fuel economy standards Economic instruments, such as differentiated taxes on vehicle purchase Policies to transition to ultra-low and zero-emission technologies Local policies Public funding to support research, development, demonstration and deployment of crucial decarbonisation technologies and infrastructure. As low carbon energy carriers take hold, the taxation of transport needs to shift towards road pricing IEA 2017

50 Delivering Sustainable Bioenergy Key Messages Adam Brown ETP 2017 Webinar, July 10 IEA

51 Sustainable bioenergy Bioenergy can be a major part of a low carbon energy system, providing lowcarbon transport fuels, electricity, and heat as part of a growing bioeconomy. To play these roles bioenergy must be deployed sustainably. But bioenergy is complex and sometimes controversial. General statements and oversimplification are unhelpful. There is growing consensus on what constitutes sustainable best practice. Bioenergy now needs a new impetus based on up to date evidence and experience IEA 2017

52 Bioenergy plays a key role in IEA Low Carbon Scenarios Role of Bioenergy Role of RTS Bioenergy to B2DS Source: ETP 2017 Bioenergy to provide almost 1/5 of cumulative carbon savings - an essential component IEA 2017

53 Bioenergy growth concentrated in transport, electricity and industry Modern bioenergy in final energy consumption 2015 Modern Biomass - Buildings Industry Transport Electricity Other 3% 6x 10x 16% DS 2% 7% 11% 17% 2.5x 31% 18% 51% 44% 16 EJ 67 EJ IEA 2017

54 Biofuels complement end-use efficiency and strong growth in electricity Biofuels play important roles in heavy freight, shipping and air transport IEA 2017

55 But advanced biofuel growth rates well below required levels IEA 2017

56 1) Exploit Immediate Opportunities Methane from wastes and effluents Immediate deployment opportunities HVO from wastes and residues Many examples of solutions ready for deployment in different regions - Mature technology - Affordable - Uncontroversial Requires favourable general policy environment - Stable predictable policy environment - Clear targets - Appropriate long term remuneration - Minimise non financial regulatory barriers Efficient use of coproducts and residues Bioenergy for district heating Specific issues for bioenergy - Stable sustainability and environmental regulations - Recognise and monetise all benefits (e.g contribution to flexibility) - Blending regulations Capacity Building Essential IEA 2017

57 2) Develop and commercialise new technologies New technologies needed with good carbon performance and adapted to low carbon energy system including: - New biofuels - More efficient bio-electricity systems - BECCS and BECCU Their introduction will require specific policy support - Quotas for advanced bioenergy production - Biofuels (RFS2, RED2) - Advanced power systems - Financial de-risking - Loan Guarantees - Continued support for R&D and Demonstration - Affordable! IEA 2017

58 3. Develop sustainable biomass suppply 145 EJ sustainable supply needed by 2050/60 Resource estimates still uncertain and more work to quantify resource needed especially at regional/national level Deployment will need more than wastes and residues Likely availability enhanced through improved land and resource management Continuing innovation needed Supportive sustainability governance framework required 2DS RTS IEA 2017

59 4. A concerted international effort to mobilise finance MI Bioenergy Challenge Development Agencies Biofutures Platform Funding Institutions Identify regional and local opportunities Build technical and regulatory capacity Build up finance pipeline Catalyse finance: $ Billion/year IEA 2017

60 Conclusions Sustainable bioenergy is a necessary component of the portfolio needed in a low carbon energy economy and contributes 17% of carbon savings in move from RTS to 2DS scenarios. In the 2DS bioenergy plays a particularly important role in de-carbonising transport especially in long distance sectors such as heavy freight, shipping and air Current progress is not in line with the move to a 2DS scenario, and more intensive efforts and needed backed by a supportive technology policy framework Four key actions needed - Exploit immediate opportunities - Develop and commercialise new technologies needed. - Develop sustainable biomass supplies, supported by a strong internationally recognised sustainability governance regime which enforces best practice and encourages innovation. - A concerted international effort and engagement of development agencies and funding organisations to mobilise investment. IEA 2017

61 Integrating demand and supply Luis Munuera ETP nd Webinar July 10, 2017 IEA

62 Current policy, infrastructure, regulatory models are not well-suited to emerging technologies Centralised fuel production, power and storage Demand today is largely a passive recipient of energy fuels and services

63 TWh TWh The future is electric Global final electricity demand Change in final electricity demand in Statistics RTS 2DS B2DS Transport Agriculture 0 Services Residential Industry DS vs RTS B2DS vs 2DS Electricity becomes on a global level the largest final energy carrier in the 2DS and B2DS, with the electricity share in final energy use more than doubling compared to today, up to 41% in the B2DS in 2060.

64 Understanding and leveraging demand-side potential 100 TV, internet, video Free time Eating Work and study TV, internet, video Free time Eating Work and study Sweden (normalised to Spain) Spain Much flexibility and potential for reducing inefficiencies and costs by integrating across sectors and systems

65 Power sector key for deep decarbonisation of the energy system CO 2 reductions in the power sector in the B2DS relative to the 2DS The power sector provides around 40% of the cumulative CO 2 reductions across all sectors to move from the RTS to the B2DS, with renewables being responsible for more than half of the reductions in the power sector.

66 TWh Distributed PV leads growth across all technology options % Rooftop Utility-scale 0% PV As a share of buildings demand As a share of total demand Distinction between demand and supply becomes blurry in deep decarbonisation scenarios

67 US (2015) billion Where distribution networks are hubs for smartness and integration % % Distribution % % 40% 30% 20% Transmission % 0% Share of distribution Investment in distribution networks needs to break from historic trends in the short-term

68 GW GW EV charging, part of the solution or part of the problem 50 Uncontrolled EV charging, no system optimisation Uncontrolled EV charging profile 0

69 GW GW EV charging, part of the solution or part of the problem Optimised EV charging System peak reduction Charging coincident with PV output Reduced net load ramping Optimised EV charging profile 0

70 Smart infrastructure can make demand part of the solution Smart EV charging infrastucture, smart meters and remote load control devices have a huge potential for low cost flexibility but there are uncertainties on diffusion and scale-up

71 Cross-sector integration and connectivity deliver enormous savings Co-generation Renewable energy resources Centralised fuel production, power and storage Smart energy system control Distributed energy resources H vehicle 2 Surplus heat EV But needs new approaches to policy and regulatory design, coordination across sectors

72 IEA