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Gent, March 7, 2012
Vlerick Finance Alumni
Didier Tshidimba
Trends and drivers of Energy demand
Decentral non-predictable production will play an increasing role in meeting growing energy demand
TotalelectricityDemand
Covered via high-voltage production
Covered via low- & medium voltage
production
TRENDS INELECTRICITY DEMAND
= +
2Vlerick Alumni_Energy demand_vf.pptxSource: Elia; CREG; Eurostat, Roland Berger
> Today's electricity demand still under pre-crisis level
> Demand will increase up to 100 TWh in 2020 and 125 TWh in 2050
90 85> Nuclear energy
covering 50% of electricity demand
> Decrease of relative importance from 96% to 75% in 2050
5> Local production
mainly via PV cells, wind and CHP
> Growing importance of local, non-predict-able production to meet future demand
> Negative effect of improved electrical performance of appliances
> Increased share of con-sumption by services in line with evolution towards a more service based economy
> Decreasing consumption by industry sector as the economy evolves towards less energy-intensive activities
Low- & Medium-
Increase in electricity demand will largely be covered by development of low- and medium-voltage production facilities
> Growth in production largely driven by generation connected to distribution network
> Strong increase of wind, CHP and
Electricity production 2010-2050 [TWh]
LOW- & MEDIUM-VOLTAGE PRODUCTION
3Vlerick Alumni_Energy demand_vf.pptx
Medium-voltage production
High-voltage production
Source: Roland Berger analysis
1960 2050
> Strong increase of wind, CHP and biomass, less growth of PV cells (in terms of produced energy)
2010
HIGH-VOLTAGE PRODUCTION
> Historical dominance of nuclear power generation
> Installation of CCGTs and CHP (gas turbines and biomass) compensa-ting for future closure of nuclear plants
Electricity demand will continue to grow, although less fast than GDP, due to mitigating factors as RUE and des-industrialization
Demand
GDP1
2
HVAC
Macro-trends
> Development of production facilities
> Healing pumps in new houses
> Rational use of energy (RUE)
200
Electricity demand 2010-2050 [2010=100]
+1.8% p.a.
4Vlerick Alumni_Energy demand_vf.pptxSource: BFP; Roland Berger analysis
2010 2050
Demand 2
3
4
Industrial
New uses/equipment
> More efficient products
> Des-industrialization
> Co-generation/ Auto-production
> Electrical vehicles
> Fuel cells
5Population
> Number of inhabitants
> Buying power
100
145
+1% p.a.
+1.8% p.a.
Transmission and distribution network operators are impacted by 3 major evolutions that shape the future energy context
1SMART GRIDS & SMART METERING
> Intelligent grids seen as indispensable in the EU objectives 20/20/20
> Mix of central and decentral production with bidirectional fluxes where consumers are producers at the same time
> Smart meter as a key tool to optimize and reduce energy consumption
> Window of opportunity to launch new services to end-clients
5Vlerick Alumni_Energy demand_vf.pptx
2
3
PRODUCTION UNCERTAINTY
NEWTECHNOLOGIES
> Production fluctuations on 2 levels:
– Cyclical (predictable): Daily & seasonal fluctuations
– Erratic (non-predictable): Climatic and consumer-driven fluctuations
> Increased need for interregional/international network solutions and storage
> Development of RES strongly increasing production uncertainty, with strong impact on the entire network
> Accelerating pace of evolution of emerging technologies for network management and RES
> Required investments to implement innovations exponentially increasing
> New technologies impacting all facets of energy market:
– Structure of distribution/transportation
– Asset management
– Operational performance
Source: Roland Berger
To deal with challenges on the energy market, organization need to develop a proper energy sourcing strategy
DEVELOP ENERGY EFFICIENCY PROGRAM
UNDERSTAND ENERGY MARKET MODEL
DEFINE TAILORED SOURCING STRATEGY
A B C
6Vlerick Alumni_Energy demand_vf.pptx
> What are my overall energy needs?
> What are the key drivers of my energy consumption?
> What are the critical points on my energy needs?
> How and where can I reduce my energy consumption?
> How does the market for gene-ration, supply and trading works?
> Who are the key actors in each market segment?
> What are the possibilities of energy trading & portfolio management (TPM)?
> What is the load profile and variability of my consumption?
> What is the degree of predictability of my energy needs?
> What is the optimal mix of energy sources?
> Should I develop own generation capacity (partnerships, auto-production)?
Source: Roland Berger
It's character
impact!that creates
It's character
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