Coal in the EU myths and reality

Transcription

1 Coal in the EU myths and reality Bogdan Janicki, Senior Adviser, CEEP World Coal Association Assocarboni Workshop Looking ę i Nazwisko, into the Stanowisko future of coal Rome December 11, /30

2 Central Europe Energy Partners (CEEP) Central Europe Energy Partners, AISBL, is an international non-profit association with its headquarters in Brussels, Belgium. The association represents the widelyunderstood Central Europe energy sector (coal, gas, oil, renewables, nuclear, grids), along with energy-intensive industries (steel, chemicals, etc.). CEEP is open to all domestic and foreign legal entities active in the energy and energy-intensive sectors, or dealing with any matters related to the mentioned sectors. There are three categories of membership: actual, affiliated and honorary. 2/30

3 CEEP members Concern Achema Group Katowicki Holding Węglowy S.A. Air Liquide KGHM Polska Miedź S.A. ArcelorMital Poland Enea S.A. Kompania Węglowa S.A PSE S.A. Polish Higher Education Business Forum PERN Przyjaźń SiPower S.A. Energa S.A. Kulczyk Investments Litgrid AB Tauron Polska Energia S.A Impexmetal S.A. Grupa Azoty S.A. LOTOS Group TRANSPETROL a.s. The PetroleumGas University of Ploieşti New World Resources N.V. Węglokos S.A. FRUNZE CLIFFORD CHANCE Expected members from: Bulgaria, Estonia, Latvia, Slovenia, Croatia, and Hungary. Jastrzębska Spółka Węglowa S.A. The Polish Electricity Association 3/30

4 Purpose and Mission CEEP's primary purpose is to support integration of the Central Europe Energy and energy-intensive sectors within the framework of the common EU energy and energy security policy. The association acts to: Identify, monitor, and where possible, aim to reduce specific and common risks to energy and energy-intensive sectors companies in Central Europe. Find solutions for and provide assistance, in relation to fundamental challenges arising from the evolution of EU energy policy, to organisations, such as members of the association. Foster, broaden and strengthen the position of its members within the internal EU energy market. Transmit and make available to EU bodies, and other international energy and energyintensive sector institutions, CEEP members' positions on and expertise in energy and energy-intensive sectors issues, especially, but not limited, to the region of Central Europe. Support its members' efforts to build up their profile and active participation in the international energy and energy-intensive sectors institutions and associations; and Identify, advise on, and promote programmes and activities which strengthen and expand members' international positions. 4/30

5 Major tasks: To increase the energy security of Central Europe, as well as the European Union as a whole. To strengthen the idea of energy solidarity within the European Union. We do believe that only common activities of all EU member states could be successful in enhancing the energy security of Europe. To build relations and facilitate contacts between Member organisations and EU bodies and agencies, individual representatives and associations of energy and energy- intensive sector companies, as well as international energy sector think-tanks and lobbies based in Brussels. 5/30

6 European Energy Security from a Central European point of view European Union Saturated EU Economies GDP per capita in 000 EUR, 2013 year Non saturated EU economies GDP per capita in 000 EUR 2013 year * 2012 data Source: CEEP based on Eurostat data 6/30

7 GDP per capita ( 000 EUR) UE saturated economies non saturated economies Source: CEEP based on Eurostat data 7/30

8 Energy Prices (EUR/MWH) Source : Central Mining Institute In times of crisis, EU countries need cheap sources of energy Solid fuels are cheapest Gas oil Fuel oil Natural gas Hard coal Lignite Nuclear energy 8/30

9 European Council decisions The European Council endorsed a binding EU target of at least a 40% domestic reduction in greenhouse gas emissions by 2030 compared to 1990 The ETS sector would have to deliver a reduction of 43% in GHG compared to 2005 The non-ets sector a reduction of 30% compared to 2005 In order to bring about the required emissions reduction in the ETS sector, the annual factor by which the cap on the maximum permitted emissions within the ETS will have to be increased from 1.74% currently to 2.2% from /30

10 European Council decisions A greenhouse gas reduction target of 40% should by itself encourage a greater share of renewable energy in the EU of at least 27% in 2030 (indicative for Member States) Member States with a GDP per capita below 60% of the EU average may opt to continue to give free allowances to the energy sector up to % of the EU ETS allowances to be auctioned by the Member States will be distributed among those countries whose GDP per capita did not exceed 90% of the EU average (in 2013) 10/30

11 What next after European Council decisions? Before the EU is a difficult challenge to create specific rules for targets adopted by the European Council Before us is a hard Hme to win the best soluhon for Central European economies Reform of the EU Emissions Trading System (ETS) - the Commission proposed to establish a Market Stability Reserve (MSR) expected CO2 price: 40EUR/t According to the plan, at the begining of December 2014, the draft proposal will be circulated by the Commission for public consultation. The final document is expected to be confermed by the end of this year Free allowances for the energy sector only for existing Power Plants or also for new Power Plants? Carbon leakage - appropriate levels of support for sectors has been declared by the Council. But at what level, and what sectors?. Benchmarks what will be the rules of benchmarks for each industry sector? 11/30

12 Electricity retail prices paid by households and industrial consumers in 2011 (in EUR/ kwh ) Source: Eurostat energy statistics Note: Range for annual consumption of: household group DC: [2 500 kwh kwh]; industry group IC: [500 MWh MWh]. 12/30

13 GDP per capita (EUR) vs. electricity prices paid by households and industrial consumers (EUR/kWh) in 2011 INDUSTRY HOUSEHOLDS Source: Eurostat energy statistics Note: GDP in Romania data for /30

14 EU industry production Source: ERT Benchmarking Report /30

15 US versus EU USA EU Compe..ve advantage/disadvantage low energy prices ( shale gas revoluhon) high energy prices ( EU climate policy) Unemployment rates: EU-28, US Source: European Commission The EU needs cheap energy to be compe..ve 15/30

16 Competitiveness of the EU economy depends on energy prices Source: World Energy Outlook /30

17 Evolution of end - user electricity price index for industry Source:Euracoal 17/30

18 CO 2 emissions per capita (kg/cap) Belgium 9,89 9,58 Malta Latvia 4,27 4,33 Denmark 7,83 6,97 Netherlands 10,03 9,82 Lithuania 5,29 5,26 Germany 9,59 9,75 Austria 8,94 8,38 Hungary 5,18 4,93 Ireland 8,60 8,48 Portugal 4,62 4,62 Poland 8,67 8,42 Greece 8,18 7,79 Finland 10,97 9,88 Romania 4,08 3,91 Spain 6,22 6,12 Sweden 5,27 4,84 Slovenia 8,49 8,46 France 5,81 5,85 U.K. 7,55 7,73 Slovakia 7,34 7,42 Italy 6,69 6,32 Bulgaria 7,71 7,10 CroaHa 5,44 5,51 Cyprus Czech Rep. 11,41 10,81 Luxembourg 21,92 21,75 Estonia 15,82 15,75 Source: JRC USA 17,12 16,36 Canada 16,33 16,04 Australia 19,36 18,77 Japan 9,77 10,40 Russia 12,41 12,39 South Korea 12,90 12,97 China 6,91 7,09 India 1,51 1,59 Brazil 2,27 2,31 Turkey Indonesia 2,01 2,00 South Africa 6,30 6,32 EU 7,53 7,42 18/30

19 EU-27 net imports Source: European Commission 19/30

20 European hard coal production, lignite production and coal imports /30

21 International hard coal market, 2012 Top coal exporting countries, 2012 Major coal producing and importing countries, 2012 Source:Euracoal 21/30

22 EU-27 Gross Electricity Generation Source: European Commission 22/30

23 EU Ambitions wishful thinking? From 1990 to 2010, the EU is the only region of the world to have decreased its CO₂ emissions (-9.2%). During the same period, competing economies have increased their CO₂ emissions, and total worldwide emissions increased by 46%. Source: ERT Benchmarking Report 2013, EIA 23/30

24 Fossil fuels Coal Source: BP 24/30

25 World - Population, GDP, Energy Demand World population (million) Source: Exxon Mobil, CEEP 25/30

26 Electricity generation by source Source:IEA 26/30

27 Germany: Depletion and new construction of plants (GW) Source: Poyry Management Consulting 27/30

28 Energy efficiency Energy efficiency (%) Improving energy efficiency by 15%, means that CO2 emissions can be reduced by at least 30%. Significant improvement Source: Central Mining Institute, EURACOAL, others 30/38 28/30

29 Carbon Capture and Storage Power plants Steel industry Chemical industry Others COAL, NATURAL GAS 70% cost Capture 10% 20% Transport CO 2 Storage ONSHORE OFFSHORE COAL MINE NATURAL GAS FIELDS CO 2 Depleted reservoirs, Aquifers CO2- EOR Other possibilihes ( CCU) Present technology would increase electricity cost by 30-50% Source :Petrofac, CEEP 29/30

30 Thank-you for your attention 30/30