Energy Technology Perspectives for a Clean Energy Future

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1 Energy Technology Perspectives for a Clean Energy Future Ms. Maria van der Hoeven Executive Director International Energy Agency Madrid, 2 September 212 OECD/IEA 212

2 Key messages 1. A sustainable energy future is still feasible and technologies exist that can take us there 2. Despite the potential of technologies, progress is too slow at the moment 3. A clean energy future requires systemic thinking and deployment of a variety of technologies 4. It even makes financial sense to do it! 5. Government policy is decisive in unlocking the potential

3 Energy demand and emissions have doubled in the past 4 years From 6 Mtoe to 12 Mtoe Rapid demand growth outside OECD CO 2 emissions from 14Gt to 3Gt Since 25, non-oecd countries emit more than OECD Source: IEA statistics

4 OECD/IEA 212 ETP 212 Choice of 3 Futures 2DS a vision of a sustainable energy system of reduced CO 2 and other Greenhouse Gas (GHG) emissions The 2 C Scenario 4DS reflecting pledges by countries to cut emissions and boost energy efficiency The 4 C Scenario 6DS where the world is now heading, with potentially devastating results The 6 C Scenario

5 ETP-212: need to halve CO 2 by 25 To achieve ambitious climate goals, the world needs to cut energyrelated CO 2 emissions by 5% from today s levels but as populations grow and energy consumption inevitably rises, the reduction challenge is even higher: a gap of Gt in 25 OECD/IEA 212

6 OECD/IEA 212 Clean energy: slow lane to fast track Cleaner coal power Nuclear power Renewable power CCS in power CCS in industry Buildings Industry Progress is too slow in almost all technology areas Significant action is required to get back on track Fuel economy Electric vehicles Biofuels for transport

7 USD billion Share of energy RD&D in total R&D Brazil China India Mexico Russia South Africa OECD/IEA 212 USD billion Energy RD&D has slipped in priority 25 12% 2 1% 15 8% 6% 28 non-iea country spending % 2 5 2% % Energy efficiency Renewable energy Hydrogen and fuel cells Other cross cutting technologies/research Fossil fuels Nuclear Other power and storage technologies Share of energy RD&D in total R&D

8 OECD/IEA 212 A smart, sustainable energy system Co-generation Renewable energy resources Centralised fuel production, power and storage Smart energy system control Distributed energy resources H vehicle 2 Surplus heat EV A sustainable energy system is a smarter, more unified and integrated energy system

9 TWh Generation share OECD/IEA 212 Renewables need to dominate EU electricity % 9% 8% 4% 4% 1% 13% 21% 17% Other renewables Other Other renewables renewables Wind Wind Wind % 6% 5% 28% 7% 9% 28% 1% Solar Solar Solar Hydro Hydro Hydro % 3% 2% 1% % 22% 53% 1% 27% 4DS 4DS 2DS % 23% 7% 2% 2DS Nuclear Nuclear Nuclear Fossil w CCS Fossil w CCS Fossil w CCS Fossil w/o CCS Fossil w/o CCS Fossil w/o CCS Renewables cover two-thirds of the electricity mix in 25 in the 2DS, with wind power alone reaching a share of 3% in the mix.

10 Renewables: mid-term forecast for Spain Drivers: Abundant renewable resources Strong grid and advanced integration of variable renewable sources Challenges: Overcapacity of electricity system Need to correct for persistently high tariff deficit TWh Spain forecast renewable generation Hydropower Wind onshore Solar PV Bioenergy CSP Wind offshore Spain power capacity vs peak load (GW) Nuclear Hydropower Combustible fuels Solar Wind Peak load OECD/IEA 212

11 TWh OECD/IEA 212 Natural gas as a transitional fuel Power generation from natural gas increases to 23 in the 2DS and the 4DS. From 23 to 25, generation differs markedly. 1 4DS 1 2DS OECD Non-OECD Natural gas-fired power generation must decrease after 23 to meet the CO 2 emissions projected in the 2DS scenario.

12 Global passenger LDV sales (million) OECD/IEA 212 Electric vehicles need to come of age FCEV Fuel Cell Electric Vehicles Electricity Plug-in hybrid diesel Plug-in hybrid gasoline Diesel hybrid Gasoline hybrid CNG/LPG Diesel Gasoline More than 9% of new light duty vehicles need to be propelled by an electric motor in 25

13 OECD/IEA 212 Industry must become more efficient GtCO DS Other industries Chemicals and petrochemicals Aluminium Pulp and paper Iron and steel Cement Significant potential for enhanced energy efficiency can be achieved through best available technologies.

14 Total savings OECD/IEA 212 Investment in clean energy pays off Additional investment Additional investment Power Industry Fuel savings Undiscounted 1% USD USD trillion Transport Residential Commercial Fuel savings Biomass Coal Oil Gas Every additional dollar invested in clean energy can generate three dollars in return.

15 OECD/IEA 212 Recommendations to Governments 1. Create an investment climate of confidence in clean energy 2. Unlock the incredible potential of energy efficiency the hidden fuel of the future 3. Accelerate innovation and public research, development and demonstration (RD&D)

16 OECD/IEA 212 For much more, please visit