RENEWABLE ENERGY INSTITUTE Tokyo 9 September Michael Liebreich Chairman of the Advisory Board

Transcription

1 RENEWABLE ENERGY INSTITUTE Tokyo 9 September 2016 Chairman of the Advisory Board

2 GLOBAL CARBON EMISSIONS FROM FOSSIL FUELS (GIGATONNES CO2/YEAR) % 4% 2% 0% Global GDP growth (real) 5.5% 5.7% 3.1% 5.4% 4.2% 3.4% 3.4% 3.4% 3.5% 5.5% 5.7% 3.1% 0% 5.4% 4.2% 3.4% 3.4% 3.4% 3.5% 10.00% 8.00% 6.00% 4.00% 2.00% 0.00% Source: IEA; CDIAC; BP; Bloomberg New Energy Finance Note: Includes NGL and processing gain, but excludes biofuels 1

3 CLEAN ENERGY INVESTMENT ROSE WHILE OIL PLUMMETED GLOBAL CLEAN ENERGY INVESTMENT VS WTI CRUDE SPOT Record investment $146/bbl $274bn $318bn $297bn $272bn $316bn $329bn $175bn $206bn $207bn $62bn $88bn $128bn $48/bbl Note: Total values include estimates for undisclosed deals. Includes corporate and government R&D, and spending for digital energy and energy storage projects (not reported in quarterly statistics). Excludes large hydro. Source: Bloomberg Intelligence, Bloomberg New Energy Finance 2

4 INVESTMENT IN POWER CAPACITY, ($BN) Renewables ex large hydro Fossil fuel Large hydro Nuclear Source: UNEP, Bloomberg New Energy Finance 3

5 RENEWABLE ENERGY INVESTMENT, BY REGION ($BN NOMINAL) United States Europe China '04'05'06'07'08'09'10'11'12'13'14'15 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 AMER (excl. US & Brazil) Brazil Middle East & Africa India ASOC (excl. China & India) '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 ' '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 ' '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 ' '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 Note: New investment volume adjusts for re-invested equity. Total values include estimates for undisclosed deals. Source: Bloomberg New Energy FInance 4

6 WIND AND SOLAR EXPERIENCE CURVES ONSHORE WIND LEVELISED COST ($/MWh) SOLAR PV MODULE COST ($/W) 1, WIND y COSTS = 3,582.42x HAVE FALLEN R² = % SINCE MODULE COSTS HAVE FALLEN 99% SINCE % SINCE H2 H Thailand Learning rate rate =19% Learning rate 19% R² = % 2014 Germany US Brazil Learning rate 24.3% Current 2015 price ,000 10, ,000 1,000, ,000 10, ,000 1,000,000 Cumulative capacity (MW) Note: Pricing data has been inflation corrected to We assume the debt ratio of 70%, cost of debt (bps to LIBOR) of 175, cost of equity of 8% Source: Bloomberg New Energy Finance Note: Prices are in real (2015) USD. Current price is $0.61/W Source: Bloomberg New Energy Finance, Maycock 5

7 2011 UNSUBSIDISED CLEAN ENERGY WORLD RECORDS ONSHORE WIND SOLAR PV US$ 6.2 cents/kwh US$ 17 cents/kwh Source: Bloomberg New Energy Finance; ImagesSiemens; Wikimedia Commons 6

8 2016 UNSUBSIDISED CLEAN ENERGY WORLD RECORDS ONSHORE WIND SOLAR PV Location: Bidder: Signed: Construction: Price: Morocco Enel Green Power January US$ 3.0 c/kwh Location: Bidder: Signed: Construction: Price: Peru Enel Green Power February US$ 4.8 c/kwh Source: Bloomberg New Energy Finance; ImagesSiemens; Wikimedia Commons 7

9 2016 UNSUBSIDISED CLEAN ENERGY WORLD RECORDS ONSHORE WIND SOLAR PV Location: Bidder: Signed: Construction: Price: Morocco Enel Green Power January US$ 3.0 c/kwh Location: Bidder: Signed: Construction: Price: Coahuila, Mexico Enel Green Power March US$ 3.6 c/kwh Source: Bloomberg New Energy Finance; ImagesSiemens; Wikimedia Commons 8

10 2016 UNSUBSIDISED CLEAN ENERGY WORLD RECORDS ONSHORE WIND SOLAR PV Location: Bidder: Signed: Construction: Price: Morocco Enel Green Power January US$ 3.0 c/kwh Location: Bidder: Signed: Construction: Price: Dubai Masdar Consortium May US$ 2.99 c/kwh Source: Bloomberg New Energy Finance; ImagesSiemens; Wikimedia Commons 9

11 2016 UNSUBSIDISED CLEAN ENERGY WORLD RECORDS ONSHORE WIND SOLAR PV Location: Bidder: Signed: Construction: Price: Morocco Enel Green Power January US$ 3.0 c/kwh Location: Bidder: Signed: Construction: Price: Chile Solarpack Corporation August US$ 2.91 c/kwh Source: Bloomberg New Energy Finance; ImagesSiemens; Wikimedia Commons 10

12 PRICE IMPACT OF SWITCH FROM FIT TO AUCTIONS, SELECTED COUNTRIES (NORMALISED) Solar PV (unit price normalised to 100 at date of first auction) 160 Onshore Wind (unit price normalised to 100 at date of first auction) % - 50% 80-35% - 60% KEY : tariffs : non-tariff price signals : auctions EMEA Other LatAm Brazil India South Africa Source: Bloomberg New Energy Finance 11

13 RENEWABLE ENERGY - THE MARCH OF THE PRICE SIGNAL 2000 Market-based mechanisms eg renewable energy auctions, certificate schemes, renewable portfolio standards Feed-in tariff/premiums Mixed Countries with auction or tender programmes 12

14 RENEWABLE ENERGY - THE MARCH OF THE PRICE SIGNAL 2001 Market-based mechanisms eg renewable energy auctions, certificate schemes, renewable portfolio standards Feed-in tariff/premiums Market-based mechanisms eg renewable energy auctions, certificate schemes, renewable Mixed portfolio standards Countries Feed-in tariff/premiums with auction or tender programmes Mixed Countries with auction or tender programmes 13

15 RENEWABLE ENERGY - THE MARCH OF THE PRICE SIGNAL 2002 Market-based mechanisms eg renewable energy auctions, certificate schemes, renewable portfolio standards Feed-in tariff/premiums Market-based mechanisms eg renewable energy auctions, certificate schemes, renewable Mixed portfolio standards Countries Feed-in tariff/premiums with auction or tender programmes Mixed Countries with auction or tender programmes 14

16 RENEWABLE ENERGY - THE MARCH OF THE PRICE SIGNAL 2003 Market-based mechanisms eg renewable energy auctions, certificate schemes, renewable portfolio standards Feed-in tariff/premiums Market-based mechanisms eg renewable energy auctions, certificate schemes, renewable Mixed portfolio standards Countries Feed-in tariff/premiums with auction or tender programmes Mixed Countries with auction or tender programmes 15

17 RENEWABLE ENERGY - THE MARCH OF THE PRICE SIGNAL 2004 Market-based mechanisms eg renewable energy auctions, certificate schemes, renewable portfolio standards Feed-in tariff/premiums Market-based mechanisms eg renewable energy auctions, certificate schemes, renewable Mixed portfolio standards Countries Feed-in tariff/premiums with auction or tender programmes Mixed Countries with auction or tender programmes 16

18 RENEWABLE ENERGY - THE MARCH OF THE PRICE SIGNAL 2005 Market-based mechanisms eg renewable energy auctions, certificate schemes, renewable portfolio standards Feed-in tariff/premiums Market-based mechanisms eg renewable energy auctions, certificate schemes, renewable Mixed portfolio standards Countries Feed-in tariff/premiums with auction or tender programmes Mixed Countries with auction or tender programmes 17

19 RENEWABLE ENERGY - THE MARCH OF THE PRICE SIGNAL 2006 Market-based mechanisms eg, renewable energy auctions, certificate schemes, renewable portfolio standards Feed-in tariff/premiums Market-based mechanisms eg renewable energy auctions, certificate schemes, renewable Mixed portfolio standards Countries Feed-in tariff/premiums with auction or tender programmes Mixed Countries with auction or tender programmes 18

20 RENEWABLE ENERGY - THE MARCH OF THE PRICE SIGNAL 2007 Market-based mechanisms eg, renewable energy auctions, certificate schemes, renewable portfolio standards Feed-in tariff/premiums Market-based mechanisms eg renewable energy auctions, certificate schemes, renewable Mixed portfolio standards Countries Feed-in tariff/premiums with auction or tender programmes Mixed Countries with auction or tender programmes 19

21 RENEWABLE ENERGY - THE MARCH OF THE PRICE SIGNAL 2008 Market-based mechanisms eg, renewable energy auctions, certificate schemes, renewable portfolio standards Feed-in tariff/premiums Market-based mechanisms eg renewable energy auctions, certificate schemes, renewable Mixed portfolio standards Countries Feed-in tariff/premiums with auction or tender programmes Mixed Countries with auction or tender programmes 20

22 RENEWABLE ENERGY - THE MARCH OF THE PRICE SIGNAL 2009 Market-based mechanisms eg, renewable energy auctions, certificate schemes, renewable portfolio standards Feed-in tariff/premiums Market-based mechanisms eg renewable energy auctions, certificate schemes, renewable Mixed portfolio standards Countries Feed-in tariff/premiums with auction or tender programmes Mixed Countries with auction or tender programmes 21

23 RENEWABLE ENERGY - THE MARCH OF THE PRICE SIGNAL 2010 Market-based mechanisms eg, renewable energy auctions, certificate schemes, renewable portfolio standards Feed-in tariff/premiums Market-based mechanisms eg renewable energy auctions, certificate schemes, renewable Mixed portfolio standards Countries Feed-in tariff/premiums with auction or tender programmes Mixed Countries with auction or tender programmes 22

24 RENEWABLE ENERGY - THE MARCH OF THE PRICE SIGNAL 2011 Market-based mechanisms eg, renewable energy auctions, certificate schemes, renewable portfolio standards Feed-in tariff/premiums Market-based mechanisms eg renewable energy auctions, certificate schemes, renewable Mixed portfolio standards Countries Feed-in tariff/premiums with auction or tender programmes Mixed Countries with auction or tender programmes 23

25 RENEWABLE ENERGY - THE MARCH OF THE PRICE SIGNAL 2012 Market-based mechanisms eg, renewable energy auctions, certificate schemes, renewable portfolio standards Feed-in tariff/premiums Market-based mechanisms eg renewable energy auctions, certificate schemes, renewable Mixed portfolio standards Countries Feed-in tariff/premiums with auction or tender programmes Mixed Countries with auction or tender programmes 24

26 RENEWABLE ENERGY - THE MARCH OF THE PRICE SIGNAL 2013 Market-based mechanisms eg, renewable energy auctions, certificate schemes, renewable portfolio standards Feed-in tariff/premiums Market-based mechanisms eg renewable energy auctions, certificate schemes, renewable Mixed portfolio standards Countries Feed-in tariff/premiums with auction or tender programmes Mixed Countries with auction or tender programmes 25

27 RENEWABLE ENERGY - THE MARCH OF THE PRICE SIGNAL 2014 Market-based mechanisms eg, renewable energy auctions, certificate schemes, renewable portfolio standards Feed-in tariff/premiums Market-based mechanisms eg renewable energy auctions, certificate schemes, renewable Mixed portfolio standards Countries Feed-in tariff/premiums with auction or tender programmes Mixed Countries with auction or tender programmes 26

28 RENEWABLE ENERGY - THE MARCH OF THE PRICE SIGNAL 2015 Market-based mechanisms eg, renewable energy auctions, certificate schemes, renewable portfolio standards Feed-in tariff/premiums Market-based mechanisms eg renewable energy auctions, certificate schemes, renewable Mixed portfolio standards Countries Feed-in tariff/premiums with auction or tender programmes Mixed Countries with auction or tender programmes 27

29 RENEWABLE ENERGY - THE MARCH OF THE PRICE SIGNAL 2016 Market-based mechanisms eg, renewable energy auctions, certificate schemes, renewable portfolio standards Feed-in tariff/premiums Market-based mechanisms eg renewable energy auctions, certificate schemes, renewable Mixed portfolio standards Countries Feed-in tariff/premiums with auction or tender programmes Mixed Countries with auction or tender programmes 28

30 RENEWABLES SHARE OF GENERATION, (% OF SYSTEM TOTAL) SOLAR WIND 25.0% 12.5% 6.3% 3.1% 1.6% 0.8% 0.4% 0.2% 0.1% 0.05% 0.0% 0.03% 0.0% 0.0% 0.0% Seven doublings 25.0% 12.5% 0.01% 15 years 15 years 6.3% 3.1% 1.6% 0.8% 0.4% 0.2% 0.1% Four doublings Note: Y-axes are logarithmic with base 2 Source: Bloomberg New Energy Finance, BP, UNEP 29

31 RENEWABLE ENERGY PROPORTION OF POWER GENERATION, 10 YEARS TO 2015 (%) Denmark 69% 61% Canada Canada 76% 9% US US 13% 67% 14% 16% UK 26% 5% Spain 37% 21% France 17% 12% Germany 36% 12% Italy 40% 20% 16% 10% China China 22% Japan Japan 11% 25% 15% 0% Lowest 50% Mid 100% Highest 89% Brazil 71% Brazil 79% S. South Africa Africa 2% 1% 3% India India 6% 17% 18% Australia 16% 10% 17% Note: Includes hydro Source: BP Statistical Review of Energy, Bloomberg New Energy Finance 30

32 EUROPE POWER GENERATION BY FUEL TYPE (TWH/YR) Intermittent renewables accounted for 16% of generation in Europe in 2015 Historical Forecast 1 4,000 60% 120% 3,500 50% 100% 3,000 2,500 40% 80% 2,000 30% 60% 1,500 20% 40% 1, % 20% 0 0% Other RE Solar Wind Hydro Nuclear Fossil Note: Includes EU 28, Norway, Iceland and Switzerland Source: Bloomberg New Energy Finance 31

33 EUROPE POWER GENERATION BY FUEL TYPE (TWH/YR) Intermittent renewables accounted for 16% of generation in Europe in 2015 Historical Forecast 1 4,000 60% 120% 3,500 50% 100% 3,000 2,500 40% 80% 2,000 30% 60% 1,500 20% 40% 1, % 20% 0 0% Other RE Solar Wind Hydro Nuclear Fossil Assumes power demand from EVs grows to 80TWh/yr by 2040, or 21% of total demand GDP growth assumed to be around 2% per year, in line with forecasts from the IMF Note: Includes EU 28, Norway, Iceland and Switzerland Source: Bloomberg New Energy Finance 32

34 EUROPE POWER GENERATION BY FUEL TYPE (TWH/YR) Intermittent renewables accounted for 16% of generation in Europe in 2015 Historical Forecast 1 4, % 60% 3, % 50% 3,000 2,500 80% 40% 2,000 60% 30% 1,500 40% 20% 1, % 10% 0 0% Other RE Solar Wind Hydro Nuclear Fossil Assumes power demand from EVs grows to 80TWh/yr by 2040, or 21% of total demand GDP growth assumed to be around 2% per year, in line with forecasts from the IMF Note: Includes EU 28, Norway, Iceland and Switzerland Source: Bloomberg New Energy Finance 33

35 EUROPE POWER GENERATION BY FUEL TYPE (TWH/YR) 4,000 3,500 3,000 2,500 2,000 1,500 1, Intermittent renewables accounted for 16% of generation in Europe in 2015 % share of generation from intermittent (RHS) Historical Forecast 1 Intermittent renewables will account for 53% of European power generation 120% 60% in % Assumes power demand from EVs grows to 80TWh/yr by 2040, or 21% of total demand GDP growth assumed to be around 2% per year, in line with forecasts from the IMF 100% 50% 80% 40% 60% 30% 40% 20% 20% 10% Other RE Solar Wind Hydro Nuclear Fossil Note: Includes EU 28, Norway, Iceland and Switzerland Source: Bloomberg New Energy Finance 34

36 MANAGING INTERMITTENCY THE BIG CHALLENGE THE BIG OPPORTUNITY Years to Months Days to minutes Seconds to minutes I. PLANNING FOR EXTREMES III. CONTROLLING FREQUENCY Demand II. CONTINUOUS BALANCING Variable supply Source: Bloomberg New Energy Finance 35

37 New technologies Incumbent technologies BALANCING THE GRID 2016 Months to years Minutes to days Seconds to ahead ahead minutes after Coal-fired generation Gas-fired generation Nuclear Reservoir hydro Pumped hydro Interconnectors Renewable generation Demand response Electrochemical storage Thermal storage Mechanical storage Chemical Source: Bloomberg New Energy Finance 36

38 New technologies Incumbent technologies BALANCING THE GRID UHV Supergrid (GEIDCO) Interconnectors Demand response Electric vehicles 2016 Future Months to years ahead Hours to days ahead Seconds to minutes after Coal-fired generation Gas-fired generation Nuclear Reservoir hydro Pumped hydro Interconnection Renewable generation Software solutions Electrochemical storage Thermal storage Mechanical storage Chemical storage Power to gas Amonium H2 Biomass /biogas Flow batteries Biofuel Smart Grid and Gridchain New heating/cooling solutions Batteries Gravity systems Solar CSP Source: Bloomberg New Energy Finance Flywheels Compressed air 37

39 POTENTIAL GRIDCHAIN APPLICATIONS Community minigrid buys & sells power, settles payments, no central controller SMART DISTRIBUTION & COMMUNITY STORAGE Transmission network settles all payments peer-topeer Secure distributed asset registries MICROGRID/ MINIGRID TRANSMISSION Carbon tax collected directly from appliances Home energy management with no central controller Shared and autonomous vehicle payments Carbon market with fraud-proof distributed registry Distribution grid balances supply and demand with no central controller SMART NETWORK EDGE DISTRIBUTION SMART HOMES AND BUILDINGS EV charging payments settlement 38

40 EV MASS MARKET $30, MILES RANGE Tesla Model 3 BMW i3 VW e-golf Chevy Bolt Nissan Leaf Images: Tesla, BMW, VW, GM, Nissan 39

41 GLOBAL LIGHT DUTY VEHICLE AND EV ANNUAL SALES, (M VEHICLES SOLD PER YEAR, %) m vehicles sold per year % of new car sales m vehicles sold per year Shared vehicle scenario30% 40% 50% 60% 70% 80% 90% 100% % 20% By 2040 Up to 50% of new cars will be EVs % of new car sales $20 oil scenario ICE + HEV BEV PHEV EV % of new sales 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% Note: forecast uses Gasoline and electricity prices from EIA s 2015 Annual Energy Outlook Low Oil Price scenario (ranging from $50 to $65 per barrel between 2015 and 2025). High scenario assumes greater vehicle utilisation. Low scenario assumes $20 per barrel oil price Source: Bloomberg New Energy Finance 40

42 TRANSFORMATION OF TRANSPORTATION IMPACT OF ELECTRIC VEHICLES EV SALES BY REGION IN 2040 Rest of the world 26% Japan 3% (MILLION VEHICLES) Total 41m China 35% Europe 15% USA 21% 1. Around 10% additional power demand 2. Chinese car industry leadership 3. Destruction of 13m bbl/day oil demand 40,000 35,000 30,000 25,000 20,000 15,000 10,000 5, ELECTRICITY DEMAND FROM EVS (TWH/YR) Electricity demand from EVs Total global electricity demand excluding EVs OIL DEMAND DISPLACED BY EVS (MILLION BARRELS / DAY) Rest of the world Japan Europe USA China Source: Bloomberg New Energy Finance 41

43 THE PARIS OPPORTUNITY Image: UNFCCC 42

44 GLOBAL GREENHOUSE GAS EMISSIONS (GTCO2) Historical emissions Pre-COP21 pledges INDC trajectory 2 C trajectory Source: UNFCCC, UNEP, Climate Action Tracker Bloomberg New Energy Finance 43

45 GLOBAL PRIMARY ENERGY SUPPLY (MTOE) Renewable energy 10,000 5,000 Nuclear 1,000 Natural gas 0 Coal Oil Source: Bloomberg New Energy Finance 44

46 GLOBAL PRIMARY ENERGY SUPPLY, 1975 (MTOE) Renewable energy 10,000 5,000 Nuclear 1,000 Natural gas 1975 Coal Oil Note: BNEF adjusted IEA NPS forecast using its own electricity generation and EV demand forecast. Renewables total includes bioenergy and hydro. Source: Bloomberg New Energy Finance, IEA 45

47 GLOBAL PRIMARY ENERGY SUPPLY, 1980 (MTOE) Renewable energy 10,000 5,000 Nuclear 1,000 Natural gas 1980 Coal Oil Note: BNEF adjusted IEA NPS forecast using its own electricity generation and EV demand forecast. Renewables total includes bioenergy and hydro. Source: Bloomberg New Energy Finance, IEA 46

48 GLOBAL PRIMARY ENERGY SUPPLY, 1985 (MTOE) Renewable energy 10,000 5,000 Nuclear 1,000 Natural gas 1985 Coal Oil Note: BNEF adjusted IEA NPS forecast using its own electricity generation and EV demand forecast. Renewables total includes bioenergy and hydro. Source: Bloomberg New Energy Finance, IEA 47

49 GLOBAL PRIMARY ENERGY SUPPLY, 1990 (MTOE) Renewable energy 10,000 5,000 Nuclear 1,000 Natural gas 1990 Coal Oil Note: BNEF adjusted IEA NPS forecast using its own electricity generation and EV demand forecast. Renewables total includes bioenergy and hydro. Source: Bloomberg New Energy Finance, IEA 48

50 GLOBAL PRIMARY ENERGY SUPPLY, 1995 (MTOE) Renewable energy 10,000 5,000 Nuclear 1,000 Natural gas 1995 Coal Oil Note: BNEF adjusted IEA NPS forecast using its own electricity generation and EV demand forecast. Renewables total includes bioenergy and hydro. Source: Bloomberg New Energy Finance, IEA 49

51 GLOBAL PRIMARY ENERGY SUPPLY, 2000 (MTOE) Renewable energy 10,000 5,000 Nuclear 1,000 Natural gas 2000 Coal Oil Note: BNEF adjusted IEA NPS forecast using its own electricity generation and EV demand forecast. Renewables total includes bioenergy and hydro. Source: Bloomberg New Energy Finance, IEA 50

52 GLOBAL PRIMARY ENERGY SUPPLY, 2005 (MTOE) Renewable energy 10,000 5,000 Nuclear 1,000 Natural gas 2005 Coal Oil Note: BNEF adjusted IEA NPS forecast using its own electricity generation and EV demand forecast. Renewables total includes bioenergy and hydro. Source: Bloomberg New Energy Finance, IEA 51

53 GLOBAL PRIMARY ENERGY SUPPLY, 2010 (MTOE) Renewable energy 10,000 5,000 Nuclear 1,000 Natural gas 2010 Coal Oil Note: BNEF adjusted IEA NPS forecast using its own electricity generation and EV demand forecast. Renewables total includes bioenergy and hydro. Source: Bloomberg New Energy Finance, IEA 52

54 GLOBAL PRIMARY ENERGY SUPPLY, 2015 (MTOE) Renewable energy 10,000 5,000 Nuclear 1,000 Natural gas 2015 Coal Oil Note: BNEF adjusted IEA NPS forecast using its own electricity generation and EV demand forecast. Renewables total includes bioenergy and hydro. Source: Bloomberg New Energy Finance, IEA 53

55 GLOBAL PRIMARY ENERGY SUPPLY (MTOE) Renewable energy 10,000 5,000 Nuclear 1,000 Natural gas BNEF Coal Oil Note: BNEF adjusted IEA NPS forecast using its own electricity generation and EV demand forecast. Renewables total includes bioenergy and hydro. Source: Bloomberg New Energy Finance, IEA 54

56 GLOBAL PRIMARY ENERGY SUPPLY (MTOE) Renewable energy 10,000 5,000 Nuclear 1,000 Natural gas IEA 450ppm 2040 BNEF Coal Oil Note: BNEF adjusted IEA NPS forecast using its own electricity generation and EV demand forecast. Renewables total includes bioenergy and hydro. Source: Bloomberg New Energy Finance, IEA 55

57 GLOBAL PRIMARY ENERGY SUPPLY (MTOE) Renewable energy Illustrative Paris scenario before 2100 Nuclear 10,000 5,000 1,000 Natural gas BNEF 2040 IEA 450ppm Coal Oil Note: BNEF adjusted IEA NPS forecast using its own electricity generation and EV demand forecast. Renewables total includes bioenergy and hydro. Paris illustrative scenario assumes some carbon capture. Source: Bloomberg New Energy Finance, IEA 56

58 NEW INVESTMENT IN CLEAN ENERGY Q Q ($BN) Quarterly new investment in clean energy. This includes investment into all asset classes except EST asset finance and R&D, which are compiled on an annual basis only. Note: Total values include estimates for undisclosed deals. Excludes corporate and government R&D, and spending for digital energy and energy storage projects (reported in annual statistics only). Source: Bloomberg New Energy Finance 57

59 NEW INVESTMENT IN CLEAN ENERGY IN EUROPE Q Q ($BN) Note: Total values include estimates for undisclosed deals. Excludes corporate and government R&D, and spending for digital energy and energy storage projects (reported in annual statistics only). Source: Bloomberg New Energy Finance 58

60 NEW INVESTMENT IN CLEAN ENERGY IN THE US Q Q ($BN) Note: Total values include estimates for undisclosed deals. Excludes corporate and government R&D, and spending for digital energy and energy storage projects (reported in annual statistics only). Source: Bloomberg New Energy Finance 59

61 NEW INVESTMENT IN CLEAN ENERGY IN CHINA Q Q ($BN) Note: Total values include estimates for undisclosed deals. Excludes corporate and government R&D, and spending for digital energy and energy storage projects (reported in annual statistics only). Source: Bloomberg New Energy Finance 60

62 NEW INVESTMENT IN CLEAN ENERGY, JAPAN Q Q ($BN) Quarterly new investment in clean energy. This includes investment into all asset classes except EST asset finance and R&D, which are compiled on an annual basis only. Note: Total values include estimates for undisclosed deals. Excludes corporate and government R&D, and spending for digital energy and energy storage projects (reported in annual statistics only). Source: Bloomberg New Energy Finance 61

63 US COAL CONSUMPTION VS GAS AND RENEWABLES, PRIMARY ENERGY (MTOE/YR) Gas US: Coal overtaken by gas in the US energy mix 400 Thermal coal Renewables inc. hyrdo Source: EIA 62

64 UK COAL CONSUMPTION (MT/YR) UK: Government committed to shutting coal by BNEF NEO 2016 forecast Source: BEIS, Prof. David Rutledge, Bloomberg New Energy Finance 63

65 Hokkaido Tohoku TEPCO Chubu Hokuriku Kansai Chugoku Shikoku Kyushu PPS J-Power TOTAL COAL CAPACITY INCLUDING PLANS BY NON-UTILITY(PPS) ENTITIES CUMULATIVE COAL CAPACITY BY SUPPLY AREA (GW) ADDITIONAL COAL CAPACITY PLANNED BY EACH ENTITY (GW) Okinawa Hokuriku Hokkaido Shikoku Chubu Tohoku Kyushu Kansai Under Construction Media reports In planning In EIA 0 Chugoku TEPCO Note: Figures includes plants that were announced officially as well as reported in media. Source: Bloomberg New Energy Finance 64

66 JAPAN THERMAL COAL IMPORT VOLUME (MILLION TONNES) Source: Japan Ministry of Finance 65

67 JAPAN GENERATION MIX Cumulative installed capacity (GW) Electricity generation (TWh) 450 1, , Source: Bloomberg New Energy Finance Source: Bloomberg New Energy Finance 66

68 ENERGY MIRACLE We need an energy miracle Bill Gates February 2016 Picture: Bloomberg 67

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