IEA 2012 Medium-Term Renewable Energy Market Report - presentation slides

7/31/2019 IEA 2012 Medium-Term Renewable Energy Market Report - presentation slides

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OECD/IEA 2012

Medium-Term Renewable Energy

Market Report 2012Michael Waldron

Senior Renewable Energy Market Analyst


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OECD/IEA 2012

Objective and scope

With the increasing role of a portfolio of maturing

renewable technologies in the power mix

The IEA is publishing its first medium-term report focused

on renewable energy

Bottom-up, global renewableforecastof renewable electricity

capacity and generation over 2011-17Detailed analysis of 12 OECD countries (Austria, Denmark, France,

Germany, Italy, Japan, Norway, Spain, Sweden, Turkey, UK, US) and

China, India, Brazil (~80% of world renewable electricity)

For 2012 edition, focus on 8 technologies in power sector

with some analysis on solar thermal heating

Completes slate of IEA MT forecasts: oil, gas, coal

Methodology consistent with other MT reports


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OECD/IEA 2012

Global Overview


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OECD/IEA 2012

Key trends

As a portfolio of renewable technologies matures, global

renewable power generation is forecast to rise 40%

Supported by policy/market frameworks and economic

attractiveness in increasing range of countries and circumstances

Technology cost developments, grid/system integration,

cost/availability of financing also weigh as key variables

High level of economic/policy uncertainty in some countries

This projected growth is an acceleration vs previous period

Growth is 60% higher over 2011-17 versus 2005-11

Renewable deployment is projected to spread out

geographically, with increased activity in emerging markets

Deployment spurring economies of scale in some technologies -

virtuous cycle of improved competition and cost reductions


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OECD/IEA 2012

Growth in renewable power is forecast

to accelerate

Hydropower remains the main renewable power source (+3.1% p.a.)

Non-hydro renewable sources grow at double-digit annual

percentage rates (+14.3% p.a.)

0

1 000

2 000

3 000

4 000

5 000

6 000

7 000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

Global renewable electricity production and forecast

Hydropower Wind onshore Bioenergy Solar PV

Geothermal Wind offshore CSP Ocean

TWh


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OECD/IEA 2012

Growth is led by non-OECD countriesNon-OECD accounts for two-thirds of the overall growth

China, Brazil, India lead; others grow significantly as well

OECD growth still largely driven by Europe but Americas

and Asia-Oceania make significant contributions

0

1 000

2 000

3 000

4 000

5 000

6 000

7 000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

TWh Global renewable electricity production and forecast

OECD Americas OECD Asia-Oceania OECD Europe

China Brazil India Rest of non-OECD


7/19 OECD/IEA 2012

Non-hydro technology deployment

spreads outNumber of countries with cumulative capacity larger than 100MW

(can cover consumption of 100k households) increases significantly

Growth areas include Asia, Africa, Latin America and the Middle East

0

20

40

60

80

2005

2011

2017

2005

2011

2017

2005

2011

2017

2005

2011

2017

2005

2011

2017

2005

2011

2017

2005

2011

2017

Onshorewind

Offshorewind

Bioenergy Solar PV CSP Geothermal Ocean

Number of countries with installedcapacity above 100 MW

Non-OECD

OECD


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Annual growth patterns for non-hydro

technologies vary significantly

China becomes deployment leader

OECD Europe deployment growth slows

OECD Americas growth reflects US policy uncertainties

0

5

10

15

20

25

30

3540

2010 2011 2012 2013 2014 2015 2016 2017

GWAnnual capacity additions , non-hydro technologies

OECD AO OECD AM OECD EUR China Rest of non-OECD


9/19 OECD/IEA 2012

Generation additions over 2011-17 differ

across regions and technology portfolios

OECD Americas (+179 TWh)

Wind onshore

Bioenergy

Solar PV

Other

technologies

OECD Asia-Oceania (+77 TWh)

Wind onshore

Bioenergy

Solar PV

Other

technologies

OECD Europe (+365 TWh)

Hydropower

Wind onshore

Bioenergy

Solar PV

Other

technologies

Non-OECD (+1 220 TWh)

Hydropower

Wind onshore

Bioenergy

Solar PV

Other

technologies


10/19 OECD/IEA 2012

Investment in renewable electricity

Annual investment topped USD 250 billion in 2011

Most recent quarterly data suggest some slowing

Economic and credit risks weigh on medium-term picture

European bank project finance and utility finance more strained

Other sources/structures of finance play increasing role

Development banks

New institutional and non-traditional corporate investors

Smaller scale financial innovation for small distributed capacity

Ultimately, cost and availability of financing to depend

most on prevailing policy and technology environments


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Renewable technologies compete better in a

wider range of circumstances

Renewable generation in general still more expensive

than bulk power but

Hydropower and geothermal mostly competitive

Onshore wind competes well in good resource areas

Solar PV approaches peak gen. costs in places with summer peak

Residential PV can be cheaper than average retail power prices

0

100

200

300

400

500

USD/MWh Levelised costs of power generation

Small scaleUtilityscale


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Country and Regional Outlooks


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US renewable generation to grow steadily

Average renewable growth of 2.4% annually over 2011-17

Non-hydropower growth at stronger rate, + 8.4% annuallyOnshore wind, solar PV and bioenergy grow strongest

CSP and geothermal growth are large in global terms

% of total power gen: 9% (2005), 13% (2011), 14-15% (2017)

0

100

200

300

400

500

600

700

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

United States renewable generation and forecast

Hydropower Wind onshore Bioenergy Solar PV Geothermal CSP Wind offshore

TWh


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State mandates drive the US picture

Source: DSIRE (March 2012).

Main US deployment drivers: state RPSs, federal financial

incentive levels, ample grid capacity, innovative financing


15/19 OECD/IEA 2012

But other challenges remain in the US

0

2

4

6

8

10

1998 2000 2002 2004 2006 2008 2010 2012 2014 2016

GW US wind capacity growth

Forecast basedon expiration ofPTC at end-2012

Expiration of federal PTC

Main US deployment challenges:

Duration of federal incentives

Wind production tax credit (PTC) expires at end-2012; but investment

tax credit for solar goes through 2016

Competition with natural gas

Cost and availability of tax equity finance


16/19 OECD/IEA 2012

China accounts for 40% of global growth

Drivers:

Growing energy needsDiversification

Government targets

Ample low-cost finance

Robust manufacturing

Challenges:Pricing framework

Priority dispatch

Grid upgrades

Prohibitive licensing for

small-scale systems

0

300

600

900

1 200

1 500

1 800

2011 2012 2013 2014 2015 2016 2017

China forecast renewable generation

Hydropower Wind onshore Bioenergy Solar PV Wind offshore CSP

TWh

0%

2%

4%

6%

8%

10%

12%

14%

16%

18%

0

2 000

4 000

6 000

8 000

2005 2008 2011 2014 2017

Y-o-YChg

TWh China power demand vs GDP growth

Demand Demand, Y-o-Y (RHS) GDP, Y-o-Y (RHS)

Challenges:

Pricing framework

Priority dispatch

Grid upgrades

Prohibitive licensing for

small-scale systems


17/19 OECD/IEA 2012

0

50

100

150

200

250

2011 2012 2013 2014 2015 2016 2017

India forecast renewable generation

Hydropower Wind onshore Bioenergy Solar PV CSP Ocean

TWh

India sees strong hydropower, wind and solar growth

Drivers:

Supportive policy

environment: Five-Year Plantargets, diverse financial

incentives

Low-cost financing from dev.

banks and private sector

Rural electrification needsdistributed generation

0%

20%

40%

60%

80%

100%

0

200

400

600

800

1 000

2000 2002 2004 2006 2008 2010

TWh India domestic electricity supply anddistribution losses

Domestic electricity supply Percentage losses (RHS)

Challenges:

High distribution losses and

regulated pricesGrid strengthening and

expansion needed

Complex administrative

requirements for projects


18/19 OECD/IEA 2012

0

100

200

300

400

500

600

2011 2012 2013 2014 2015 2016 2017

Brazil forecast renewable generation

Hydropower Wind onshore Bioenergy Solar PV

TWh

Brazils hydropower and wind grow strongly

Drivers:

Government sponsored power

auctionsCost reductions wind recently

outbid natural gas

Pipeline of hydropower projects

Low-cost financing from dev.

banks and private sector

Challenges:

Adequate margins for wind

projects (?)

Environmental licensing

Economic attractiveness of

solar PV (?)

0

20

40

60

80

100

120

140

160

2009 2010 2010 2011 2011 2011

Reserve A-3 Reserve A-3 Reserve A-5

Brazil average auction price for new wind

BRL per megawatt-hour

USD per megawatt-hour


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Thank You

&Questions

Documents

IEA 2012 Medium-Term Renewable Energy Market Report - presentation slides