Renewable Energy and other Sustainable Energy Sources. Paul Simons Deputy Executive Director International Energy Agency
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1 Renewable Energy and other Sustainable Energy Sources Paul Simons Deputy Executive Director International Energy Agency G20 ESWG meeting Munich, 14 December 2016
2 Renewables and efficiency lead the transition Contribution of technology area to global cumulative CO 2 reductions A balanced mix of technologies led by energy efficiency and renewables achieve the 450 Scenario.
3 G20 RE Toolkit & Action Plan The IEA is actively supporting the G20 on scaling up renewables: Analysis of renewable energy costs Joint IEA-IRENA Renewables Policy Database Potential of biomass (via IEA Bioenergy Technology Collaboration Programme) Grid Integration of Variable Renewables (GIVAR)
4 Renewable cost reductions to remain an important driver for future growth 400 Weighted average generation costs for solar PV and wind USD 2015/MWh Onshore wind Offshore wind Solar PV - utility scale Utility-scale solar PV generation cost to fall by another quarter and onshore wind by 15% over , largest absolute cost reduction expected from offshore wind
5 IEA/ IRENA policy database Joint IEA/IRENA database on renewable energy policies Increased use of database: Page views up by 17% from H to H1 2016, total of
6 Bioenergy Update IEA Bioenergy roadmap by mid-2017 Single roadmap covering bioenergy for heat and power and for transport fuels Two workshops (WS) held so far Scoping WS, 6 July 2016 IEA/IRENA WS Sustainable Bioenergy Supply, 28 September 2016 Future workshop planned on biomass sustainability issues +
7 Growing shares of wind and solar power for G20 members Wind and solar photovoltaics (PV), share in annual power generation, GERMANY UK EU ITALY AUSTRALIA MEXICO TURKEY FRANCE USA CHINA BRAZIL JAPAN INDIA CANADA SOUTH AFRICA KOREA ARGENTINA INDONESIA SAUDI ARABIA RUSSIA PV share 2015 Wind share 2015 Additional PV share 2021 Additional wind share % 5% 10% 15% 20% 25% 30% Key point: G20 members are experiencing a rapid increase in wind and solar power in their electricity mix this makes system integration a key priority. Source: Medium Term Renewable Energy Market Report, 2016
8 - 8 but this can bring challenges Wind penetration and curtailment in selected countries, Wind penetration level in the energy mix (left axis) Curtailment rate (right axis) Key point: Curtailment levels are a good indicator for successful VRE integration growing curtailment signals shortfalls in power system flexibility
9 Next Generation Wind and Solar Power New phase of wind and solar deployment: Low-cost Technologically mature Requires new policies to achieve integration: Focus on generation cost no longer enough Policies need to consider system-wide impact Case studies with recommendations for G20 countries: Brazil, China, Indonesia, Mexico, South Africa Key point: Next-generation wind and solar PV need next-generation policies focusing on system value and not just costs. - 9
10 - 10 New priorities for deployment of wind and solar power Traditional approach Next generation approach When is electricity produced? Where is electricity produced? How is electricity produced? Not considered Best resources, no matter where Do not provide system services Optimised: best mix of wind and solar; advanced power plant design; strategic choice of location Optimised: trade-off between cost of grid expansion and use of best resources Optimised: better market rules and advanced technology allow wind and solar power to contribute to system services Key point: Next-generation wind and solar power require next generation polices.
11 Key action areas and policy examples 24/7 Action area Integrated planning: wind and solar embedded in energy strategy Location: siting VRE closer to existing network capacity and/or load centers Technology mix: balanced mix of VRE resources can foster lasting synergies Optimising generation time profile: design of wind and solar PV plants System services: wind and sun contribute to balance system Policy example Denmark: integrated energy strategy Location: new auction design for wind and PV Technology mix: Integrated Resource Plan California: incentive to produce at peak times System services: wind active on balancing market Local integration with other resources such as demand-side response, storage Australia: incentives for self-consumption - 11
12 main recommendations 1. Next generation wind and solar power calls for next generation policies. These focus on maximising value while reducing cost. Time-based pricing is crucial. 2. Power system transformation: integrating high shares of VRE cost effectively by adopting a whole energy systems approach. 3. Advanced VRE technology: ensure power plants can provide system services by adopting forward-looking technical standards. 4. Distributed resources: reform the institutional and regulatory structure of low- and medium-voltage grids, reflecting their new role in a smarter, more decentralised electricity system. 5. Strategic planning: develop or update long-term energy strategies to reflect potential of next-generation wind and solar.
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