EREF Political Report

EREF Political Report

Dr. Doerte FouquetEREF representing DirectorMay 2010

EREF Political Report1Dr. Doerte Fouquet, Director EREF,May 20102

Reasons for Concern The Red Embers2 oCSource: Smith et al. PNAS, 200922Dr. Doerte Fouquet, Director EREF,May 20103A view on the global situationA view on forecastsA view on the Commission/EuropeA view on the support mechanismsA view on EREF and 2010/2011

3Dr. Doerte Fouquet, Director EREF,May 20104A view on the Global Situation4Dr. Doerte Fouquet, Director EREF,May 20105The World and Europe hit by the worst economic crises since..Destabilizing of Europes economiesRisk of Euro collapseStrong policies for a change in energy structure weakened in Europe ( more important things to do)Shock Therapists are coming back crucial who from IMF will advise in Greece etc.5State of Affairs Globally in EnergySource Ren 21Dr. Doerte Fouquet, Director EREF,May 20106

6ConnectionsSource: Thomas B. Johansson 2010Dr. Doerte Fouquet, Director EREF,May 20107

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Dr. Doerte Fouquet, Director EREF,May 20108Net Increase/Decrease of capacity in electricity in EU 2000-2007 (in MW) Source: Prioritising Wind Energy Research Strategic Agenda, EWEA; Platts 8Sustainable future - ante portas?Dr. Doerte Fouquet, Director EREF,May 20109RWE CEO Says New Coal-Fired Projects "On Hold"

May 27, 2009--RWE PowerBuilding of new coal-fired plants is no longer economically feasible. Dr. Johannes Lambertz, President and CEO of RWE Power, announced that new coal-fired power plant are now too expensive to build because of rising construction costs, fluctuating electricity and fuel prices in a liberalised marketplace, and the cost of implementing carbon capture and storage (CCS) technologies.

http://www.industrialinfo.com/showAbstract.jsp?newsitemID=147100

9Energy market structure unchangedDr. Doerte Fouquet, Director EREF,May 201010In the EU, market concentration is a factCalls for breaking up of giants even from state advisory bodies ( such as Monopoly Commission by the German Government) without great effects so far.Energy consumption reduced good- but nuclear and fossil block the gridsRES deployment in times of overcapacity -difficult10100 % RES is the objective for 2050Drastic change especially of the electricity sector towards RESInvestment decision outside RES and outside Energy Efficiency will jeopardize to reach 95 % GHG reduction in EuropeSame for prolonged life of Nuclear Renewable energy and Efficiency Impact assessment (REEI) needed for all policies Structured sectoral roadmap on demand side bases as guiding line for policies30 plus % for RES in 2030 in EU 2711Dr. Doerte Fouquet, Director EREF,May 201011EU Trajectory to 2020Source: JRC

12Leadership of Spain and Germany in RES is weakeningDr. Doerte Fouquet, Director EREF,May 201013Visions are goneClarity is outAll policies in Energy focusing on what is good for the oligopoliesFalse prophecies (DESERTEC) weaken distributed agendaLegislators attack against PV in Germany and Spain has its reasons partly in industry -made greed and wrong signals but also in the fact that utilities see distributed demand and supply as threat and not as market chance by changeThe success story is no longer strongly advertised 13Low Carbon MythDr. Doerte Fouquet, Director EREF,May 201014Nuclear tries all and hard to get a new aura by being almost renewableCarbon sequestration policies Small Country assaults by Nuclear (Finland, Switzerland)United Kingdom will be key for success or failure in EuropeFirst signs from new government problematic /Nuclear yes, if no subsidies

14Grid and Storage WeaknessDr. Doerte Fouquet, Director EREF,May 201015RES and especially EREF needs to combine all forces to enhance financing and structural policiesWorkshop with DUH (and GEODE) to be planned for late fallShort report from Andrea on latest DUH Workshop in Berlin15Dr. Doerte Fouquet, Director EREF,May 201016A view on forecasts16Costs for restructuringRestructuring of the global electricity sector requires investment of $14.7 trillion up to 2030. This compares with $11.3 trillion under a Reference Scenario based on International Energy Agency projections. While the average annual investment required to implement the EREC/Greenpeace Energy [R]evolution Scenario would need just under 1% of global GDP, it would lower fuel costs by 25% - saving an annual amount in the range of $750 billion17Dr. Doerte Fouquet, Director EREF,May 201017A variety of AugursDr. Doerte Fouquet, Director EREF,May 201018The political scene in Brussels is preparing the ground for a 2030/2050 energy policy agenda. Several studies have been (European Climate Foundation, EREC, Eurelectric, etc.) or will be (SRU, Greenpeace, etc.) advocating either for a low-carbon economy (with more or less big shares of CCS and nuclear) or a sustainable economy (with 100% or nearly-100% RES). At the same time the European Commission is working on its 2050 Roadmap with a public consultation starting end of June and a first consideration of a 2050 draft at the informal Energy Council beginning of September.

18REPAPDr. Doerte Fouquet, Director EREF,May 201019Solid and distinguished forecast by RES Sector for their respective EU country/market for 2020Catalyst for discussion in Member States and with CommissionIndicator for level of ambition in the respective country19Scenario comparisons- PVDr. Doerte Fouquet, Director EREF,May 201020

Sources: IEA WEO 2009, IEA ETP 2008 , Greenpeace energy [r]evolution, 2008, EPIA SET for 2020 European Climate FoundationDr. Doerte Fouquet, Director EREF,May 201021

21ECF Scenarios for low carbonDr. Doerte Fouquet, Director EREF,May 201022

22Dr. Doerte Fouquet, Director EREF,May 201023 The ECF political study at no point tackles the major obstaclesHesitant unbundling Deep market distortion through oligopolistic structure Steep price increase on energy prices without adequate or any environmental or energy security benefit (since oligopolies so far hardly invested before 2008 in new renewables) Ever increasing windfall profits especially from old nuclear power plants No internalization of externalities On the contrary : See Page 8: The last ten years has been a period of intense activity in the field of European energy policy. The liberalisation agenda has triggered monumental changes in industry structure and ownership and has created a new basis for competition and regulation in power and gas markets. This process has involved three legislative packages at EU level, with the last of these coming into force as recently as 2009, along with a whole series of regulations and statutes being implemented within Member States. In addition to this revolution in the market framework, the energy industry and policy makers have had to come to terms with the extent of the climate change challenge and the implications this has for the way energy is produced and consumed going forward. There is no single word or fact on the market concentration since 1996,23Need for clear strategies as consequences from scenariosDr. Doerte Fouquet, Director EREF,May 201024Too many cooks may spoil the porridgeA scenario can only be as good as the policies designed and executed from itEREF needs to develop some focused action points as result from our learning under the REPAP effort and from our own EREC and Greenpeace ScenarioWe need clear and crisp rebuttal messages against the establishment in Energy (e.g. EURELECTRIC)EREC has started compiling this, needs input24Dr. Doerte Fouquet, Director EREF,May 201025A view on the Commission25Energy Commissioner Gnther OettingerDr. Doerte Fouquet, Director EREF,May 201026ConservativeClose to big utilitiesHesitantNot unfriendly to renewablesNO visionary Cabinet full of kind, energy greenhorns

This reflects on work of CommissionUpcoming crucial documents from Commission:Infrastructure Roadmap 2030/2050Several reports under the new RES Directive26Dr. Doerte Fouquet, Director EREF,May 201027A view on the support mechanisms

27The Kriegers Flak DilemmaDr. Doerte Fouquet, Director EREF,May 201028Big offshore development with participation from different countries could make or break national support mechanismsNeed for a review of Feed-In Tariffs (are they really robust enough, price digression proved?)Why Quota and Trade is no alternative (British may have a success story to tell; same Sweden/Norway)Need to look for joint development of FiT from several countriesNeed to push for a re-vitalisation of FiT Cooperation28Market incentive programmes revisitedDr. Doerte Fouquet, Director EREF,May 201029EREF needs to create overview on direct market incentive policies and their problems and chances in member states Incentives as crisis medicineClarity on overall economic benefit of Incentive programmesLink to specific financing agencies (EIB, KfW,.)29Windfall policiesDr. Doerte Fouquet, Director EREF,May 201030More ideas needed how to blame and shame in the most effective way the lack of windfall profit taxation30Dr. Doerte Fouquet, Director EREF,May 201031A view on EREF and 2010/2011

31Some points for EREF in 2010/2011Dr. Doerte Fouquet, Director EREF,May 201032Supplementary Suggestion from Brussels:RE-Enforcing participation of DF in board meetings of national associationsEstablishing of a formalized column /monthly of policy news from the Members (short, telegram style contact information for follow-up)Further re-connecting to APPA/or other Spanish associationsNatural development of new membershipsComplaint pool under new RESEREF- Barometer for members based on REPAP/Nat. Policies to be used to outside world as wellGrid/Storage Workshop in fall (partners: DUH, GEODE?)

32RES industry CredoDr. Doerte Fouquet, Director EREF,May 201033We therefore commit ourselves to promote an economy based on energy efficiency and renewable energy and call on local, regional, national and European leaders to support and advocate a truly sustainable 2050 vision: Leading by example: 100% renewable energy for the European Union!

33RES industry call on leadershipDr. Doerte Fouquet, Director EREF,May 201034Ensuring the timely, effective and full implementation of the 2009 Renewable Energy Directive in all EU-27 Member StatesSetting a legally binding energy efficiency target of at least 20% by 2020Removing all subsidies and structural advantages for fossil and nuclear energyEnsuring that immediate financial support is given to renewable energy and energy efficiency measures in order to overcome the EUs economic crisis in a sustainable and forward-looking mannerSetting the right incentives for a European smart gridRedirecting existing and focussing forthcoming EU research & development budgets as well as development and structural funds on sustainable energy priorities, namely energy efficiency, and renewable energyProviding training and education of the workforce as well as information and market stimulation campaigns

34Dr. Doerte Fouquet, Director EREF,May 201035Thank you !!!

Drte35PV scenarios capacity72035801825027098029005085150

202020302050Cumulative installed capacity [GW]

PV scenarios TWh792411722812.5297112736255597.75187.5272823429050741

202020302050PV generated electricty [TWh]

IPCC-overviewGlobalGlobal parametersRenewable Power & Heat productionEnergy parametersCostsMarket developmentLifetimePotentialsCummulative CapacityGeneration% of Global GenerationCapacity factor (average)Installation CostsOperation & Maint. Costs (average)total specific generation costsSystem Intergeration CostsUncertaintiestime span of growth rateannual market growthAnnual manufaction capacityMarket PhaseRD & D needsEnergy pay-back timeTechnical life timeEconomic life timeTechnical Potential mapsSustainable PotentialGW (el./ therm)TWh (el./ therm)high global demandmedium global demandlow global demand%2005 $/kW$/kWcents/kWhcents/kWh%/aGW/aDevelop.DemoMarket$/ayearsyearsyearsPJ/aPJ/aSet for 2020 + extrapolation (2009)Greenpeace/EREC (2008)IEA Baseline (2008)Set for 2020 + extrapolation (2009)Greenpeace/EREC (2008)IEA Baseline (2008)Final electricity consumtion IEA Reference Scenario (2009)highmediumlowhighmediumlowhighmediumlowhighmediumlow%highmediumlowhighmediumlowI = kW/a, II = MW/a III = GW/ahigh / low?specifyspecifySolar202072027050792297552728211.4%1200 to 20001400 to 22002200 to 37001%(2009 to 2020)25.0%18.8%-17.0%20075.02.00.7 - 1.63030203035809808541171127983429012.6%1000 to 16001100 to 18002000 to 32001%(2020 to 2030)10.0%7.7%24.0%500110.010.00.5 - 1404020501825029001502281336251885074113.7%750 to 1250950 to 16001600 to 27001%(2030 to 2050)5.0%0.0%-8.0%1250110.02.00.5 - 15050CSP - 20201008083202702637.7%3000 to 47003050 to 48503600 to 58604.4(2009 to 2020)66.5%62.0%24.0%4433.02.0CSP - 203031520012186011705462.8%2750 to 44002850 to 45503500 to 5600(2020 to 2030)-12.0%-17.0%-25.0%146.00.5CSP - 20502100800171277052609569.6%2350 to 37502550 to 40003400 to 5400(2030 to 2050)17.5%16.0%8.0%300100.00.5Solar Thermal - 2020216065036018405503109.7%(2009 to 2020)Solar Thermal - 2030563064047905409.7%(2020 to 2030)Solar Thermal - 2050136803000120011630256010209.7%(2030 to 2050)Total SolarPrimary energy [PJ/a]% of Global (primary energy)202020302050WindGW (el./ therm)TWh (el./ therm)% of Global GenerationOnshore - 2020Onshore - 2030Onshore - 2050Offshore - 2020Offshore - 2030Offshore - 2050Total WindPrimary energy [PJ/a]% of Global (primary energy)202020302050GeothermalGW (el./ therm)TWh (el./ therm)% of Global Generation> for heating> for power generation> heat & powerTotal GeothermalPrimary energy [PJ/a]% of Global (primary energy)202020302050Bio energyGW (el./ therm)TWh (el./ therm)% of Global Generation> for heating> for power generation> heat & powerTotal Bio energyPrimary energy [PJ/a]% of Global (primary energy)202020302050OceanGW (el./ therm)TWh (el./ therm)% of Global GenerationWaveTidalOcean CurrentOTEC> total OceanTotal OceanPrimary energy [PJ/a]% of Global (primary energy)202020302050HydroGW (el./ therm)TWh (el./ therm)% of Global Generation> large> small> total HydroTotal OceanPrimary energy [PJ/a]% of Global (primary energy)202020302050Renewables: Fuels and other technogiesEnergyCostsPotentialsRDD needsPrimary energyPJ/a$/PJ (?)TechnicalSustainableRDD targetexpected private RDD funding until 2030optimal public RDD need until 2030high/lowPJ/aPJ/aSolartechnology breakthroughPassive Solarcost learning target> Buildingsresource map> further break down?etc.Direct Solar> daylight> more?PJ/a?barrel/a (?)$/PJ (?)$/barrel (?)PJ/aPJ/aBio energy (Fuels)> ethanol> diesel> aquatic biomass (algae)> further breakdown?

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