Tapping technology’s potential to secure a clean energy future

© OECD/IEA 2012

Tapping technology’s potential to secure a clean energy future

Ms. Maria van der Hoeven, Executive Director

Mr. Bo Diczfalusy, Director

Paris, June 11 2012

ETP 2012 – Choice of 3 Futures

© OECD/IEA 2012

6DS where the world is now heading with potentially devastating results

The 6°C Scenario

4DS reflecting pledges by countries to cut emissions and boost energy efficiency

The 4°C Scenario

2DS a vision of a sustainable energy system of reduced Greenhouse Gas (GHG) and CO2 emissions

The 2°C Scenario

Sustainable future still in reach

© OECD/IEA 2012

Are we on track to reach a clean

energy future?

NO ✗

Can we get on track?

YES ✓

Is a clean energy transition urgent?

YES ✓

Recommendations to Governments

© OECD/IEA 2012

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)

A smart, sustainable energy system

© OECD/IEA 2012

A sustainable energy system is a smarter, more unified and integrated energy system

Clean energy: slow lane to fast track

© OECD/IEA 2012

Progress is too slow in almost all technology areas Significant action is required to get back on track

0

5 000

10 000

15 000

20 000

25 000

30 000

35 000

40 000

45 000

2009 2020 2030 2040 2050

Other

Wind

Solar

Hydro

Nuclear

Biomass and waste

Oil

Gas with CCS

Gas

Coal with CCS

Coal

Low-carbon electricity: a clean core

© OECD/IEA 2012

Renewables will generate more than half the world’s electricity in the 2DS

TWh

Renewables need to dominate EU electricity

Renewables cover two-thirds of the electricity mix in 2050 in the 2DS, with wind power alone reaching a share of 30% in the mix.

0

500

1 000

1 500

2 000

2 500

3 000

3 500

4 000

4 500

5 000

4DS 2DS

2009 2050

TWh

53%

27%

2%

1%

7%

28%

22%

23%

10%

9%

13%

7%

10%

4%

21%

28%

4%13%

17%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

4DS 2DS

2009 2050

Gen

erat

ion

shar

e

Other renewables

Wind

Solar

Hydro

Nuclear

Fossil w CCS

Fossil w/o CCS

Wind and solar must grow quickly

An additional USD 1.2 trillion are needed in the EU power sector, but fuel savings amount to USD 2.7 trillion

0 2 4 6 8 10 12 14 16

Coal with CCS

Gas with CCS

Biomass

Wind, onshore

Wind, offshore

PV

CSP

Nuclear

Hydro

GW per year

2020-50

2010-20

2006-10

All flexibility sources will be needed

Dispatchable power plants

Energy storage facilities

Interconnection with adjacent

markets

Biomass-fired power plant

Pumped hydro facility

Scandinavian interconnections

Demand side Response

(via smart grid)

Industrial

residential

0

2 500

5 000

7 500

2009 2020 2030 2040 2050 Pow

er G

ener

atio

n fro

m N

atur

al G

as

TWh

OECD China India Other non-OECD

Natural Gas: a transitional fuel

© OECD/IEA 2012

Around 2030, natural gas becomes ‘high carbon’

The CCS infant must grow quickly

© OECD/IEA 2012

Note: Capture rates in MtCO2 /year

Mt CO2

Mt CO2

Mt CO2

Mt CO2

Mt CO2

Mt C

O2

0

2

4

6

8

10

12

2010 2020 2030 2040 2050

6DS

Other industries

Chemicals and petrochemicals Aluminium

Pulp and paper

Iron and steel

Cement

Industry must become more efficient

© OECD/IEA 2012

Significant potential for enhanced energy efficiency can be achieved through best available technologies.

GtC

O2

Electric vehicles need to come of age

© OECD/IEA 2012

0

50

100

150

200

2000 2010 2020 2030 2040 2050

FCEV

Electricity

Plug-in hybrid diesel

Plug-in hybrid gasoline

Diesel hybrid

Gasoline hybrid

CNG/LPG

Diesel

Gasoline

Fuel Cell Electric Vehicles

More than 90% of light duty vehicles need to be propelled by an electric motor in 2050

Pas

seng

er L

DV

sal

es (m

illio

n)

0

1

2

3

4

5

6

7

8

2010 2012 2014 2016 2018 2020

mill

ion

sale

s/ye

ar

Manufacturers production/sales

Projection (Estimated from each country's target)

Translating targets into action

© OECD/IEA 2012

Government targets need to be backed by policy action

2010 2012 2014 2016 2018 2020

Space heating 22%

Water heating 12%

Cooking 15%

Cooling and ventilation 5% Lighting

6%

Appliances 10%

Space heating, 7%

Water heating, 2%

Cooling and ventilation, 3%

Lighting, 3%

Other 15%

Total energy savings 33 EJ

Building Blocks of a Cleaner Future

© OECD/IEA 2012

Services

Residential

About 70% of buildings’ potential energy savings between the 4DS and 2DS are in the residential sector

0.0

0.5

1.0

1.5

2.0

2.5

2010 2020 2030 2040 2050

Billi

on h

ouse

hold

s Building sector challenges differ

OECD Non OECD

75% of current buildings in OECD will still be standing in 2050

Heating & Cooling: huge potential

© OECD/IEA 2012

Heating and cooling account for 46% of global energy use. Their huge potential for cutting CO2 emissions is often neglected.

Emissions must be eliminated by 2075

© OECD/IEA 2012

A zero-carbon future looks possible but will be very challenging, even if 2050 targets are met in the 2DS.

- 160 - 120 - 80 - 40 0 40

10%

3%

Undiscounted

Without price effect

With price effect

Additional investment

Tota

l sav

ings

Fu

el s

avin

gs

Power

Industry

Transport

Residential

Commercial

Biomass

Coal

Oil

Gas

Fuel savings

Additional investment

Clean energy investment pays off

© OECD/IEA 2012

Every additional dollar invested in clean energy can generate 3 dollars in return.

USD trillion

© OECD/IEA 2012

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