THE RENEWABLE ENERGY REVOLUTION OPPORTUNITIES … · KEY FIGURES PHOTOVOLTAIC ROOFTOP PLANT IKEA STORE, PARIS AREA, 2016 Ikea Store in the Paris area 100 % self –consumption : all

GÉNÉRALE DU SOLAIRE69, rue de Richelieu 75002 PARISwww.gdsolaire.com

THE RENEWABLE ENERGY REVOLUTION:

OPPORTUNITIES, CHALLENGES & PERSPECTIVES

Antoine HUARD8th November 2018

DISCLAIMER

THE RENEWABLE ENERGY REVOLUTION: OPPORTUNITIES, CHALLENGES & PERSPECTIVES

2

The oral and written views expressed in this presentation are solely those of the author in his private capacity and shall not be interpreted as the views of the

Generale du Solaire group

GÉNÉRALE DU SOLAIRE GROUP – HISTORY

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GÉNÉRALE DU SOLAIRE GROUP✓ Founded in 2008 by Daniel Bour, Générale

du Solaire is a 100% independent Group

✓ Covers the entire PV value chain of thephotovoltaic energy

✓ Worldwide footprint

▪ Europe : France – Italy – Switzerland - UK

▪ Africa : Morocco – Senegal – Cameroon –

Ivory Coast – Ghana – Kenya

▪ Asia : Sri Lanka – Lebanon – Indonesia

Projectdevelopment

Engineering Proc. & Construction

OperationMaintenance

Project financing

Power generation

Asset management


GÉNÉRALE DU SOLAIRE GROUP – KEY FIGURES


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200+Solar plants built

120 MWp

Installed capacity

50% directly owned

175+Winning projects at the French

Energy Regulation Commission bids

40M€Group Turnover in 2017

1.2 GWp

Capacity in development in the world, including Africa

OUR PHOTOVOLTAIC SOLUTIONS


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GROUND MOUNTED

SOLAR PLANTS

Mounted on fixed structures or equipped with single or dual axis solar tracker

ROOFTOP SOLAR PLANTS

New buildings

Renovation

PHOTOVOLTAIC PARKING SHELTERS

Supermarket parking

Vehicle storage area

Large goods vehicles parking,

Public parking zone

R &D

Energy storage

Off-Grid Projects

Hybrid Projects

Mini-grid Projects

SELF-CONSUMPTION

Savings on the electricity bill

Net metering scheme when applicable

KEY FIGURES

GROUND MOUNTED PHOTOVOLTAIC POWER PLANT, PUJAUT, FRANCE,

2014

✓ Rehabilitation of a landfill site, owned by the

French Railroad Operator Réseaux Ferrés de

France, used for waste embankment material

✓ Severely polluted by heavy metals

✓ Podio Alto is one of the first solar power plant

built in France with solar tracker devices in

order to optimize the plant output

✓ The power plant takes part in CEA (French

Institute for Alternative Energies) research on

energy storage strategies


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✓ Name AIREFSOL ENERGIES 4 ✓ Surface 70 000 m²

✓ Installed capacity 3,5 MWp ✓ Type of structure FIxed

✓ Address Lieu-dit Podio Alto, Pujaut, Gard ✓ Power generation 6 160 MWh/y

✓ Country France ✓ Eq. consumption of 2000 Househ.

✓ Type of power plant Ground Mounted ✓ Avoided CO2 emission 400 t/year

✓ Commissioning Oct. 2014✓ Investment 7 M€

KEY FIGURES

PHOTOVOLTAIC ROOFTOP PLANT

IKEA STORE, PARIS AREA, 2016

✓ Ikea Store in the Paris area

✓ 100 % self – consumption : all electricity produced is used to power the store’s equipment

✓ Panels and Inverters made in France by Voltec and Socomec


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✓ Name IKEA ✓ Surface 800 m²

✓ Installed capacity 114 kWp ✓ Type of structure BIPV

✓ Address IKEA Paris-Sud, Ile de France ✓ Power generation 120 MWh/y


✓ Type of power plant Rooftop ✓ Avoided CO2 emission 10 t/year

✓ Commissioning 2016✓ Investment 0,19 M€

KEY FIGURES

PHOTOVOLTAIC PARKING SHELTERS

PARC SAINT PAUL, DRÔME, FRANCE, 2014

✓ Set of 6 photovoltaic parking shelters

✓ Built on the parking of a shopping mall in Parc Saint Paul in the South of France

✓ Enhanced financial value of the parking area

✓ Protection of consumers against sunlight and rain

✓ The solar panels are made in France provided by Voltec


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✓ Name APSYS ✓ Surface 4 100 m²

✓ Installed capacity 600 MWp ✓ Type of structure Parking Shelters

✓ Address Parc Saint Paul, Drôme ✓ Power generation 780 MWh/y


✓ Type of power plant Parking Shelters ✓ Avoided CO2 emission 50 t/year



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THE RENEWABLE ENERGY REVOLUTION

IEA OUTLOOK FOR RENEWABLES IN 2004

ANNUAL ADDITIONS


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Source : BNEF

In 2004, IEA was forecasting around 13 GW of annual wind and solar

capacity addition by 2020.

NET POWER GENERATING CAPACITY ADDED IN 2017

BY MAIN TECHNOLOGY, IN GW


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Source : UNEP

150 GW of solar and wind capacity were added in 2017.

RENEWABLE POWER GENERATION AND CAPACITY

AS A SHARE OF GLOBAL POWER, 2007-2017, IN %


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Source : UNEP

Renewable capacity additions account for more than 60% of net

worldwide annual capacity increase in 2017

INVESTMENTS IN POWER CAPACITY, BY TECHNOLOGY


15

Source : UNEP

GLOBAL NEW CLEAN ENERGY INVESTMENT

AND CAPACITY INSTALLATIONS


16

Source : BNEF

GLOBAL NEW INVESTMENT IN RENEWABLE ENERGY

BY SECTOR, 2017 (BN$)


17

Source : UNEP

LEVERIZED COST OF ENERGY ANALYSIS


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Source : Lazard

UNSUBSIDIZED LEVELIZEDCOST OF ENERGY COMPARISON


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Source : Lazard

UNSUBSIDIZED LEVELIZEDCOST OF ENERGY—WIND & SOLAR PV

(HISTORICAL)


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Source : Lazard

UNSUBSIDIZED RENEWABLE ENERGY WORLD RECORDS IN 2017


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Source : BNEF

WIND EXPERIENCE CURVE


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Source : BNEF

EVOLUTION OF WIND TURBINE HEIGHTS AND OUTPUT


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Source : BNEF

SOLAR EXPERIENCE CURVE


25

Source : BNEF

GLOBAL NEW INVESTMENT IN RENEWABLE ENERGY :

SPLIT BY TYPE OF ECONOMY, 2004-2017 (BN$)


26

Source : UNEP

GLOBAL NEW INVESTMENT IN RENEWABLE ENERGY

BY REGION, 2004-2016, $BN


27

Source : UNEP

RENEWABLE ENERGY PROPORTION OF POWER GENERATION, 2006-16


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Note : excludes large hydro

Source : BNEF


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THE RENEWABLE ENERGY REVOLUTION - PERSPECTIVES

IEA RENEWABLES CAPACITY FORECAST EVOLUTION


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Source : IEA WEO, BNEF

OIL PRICE HISTORY AND 2004 FORECAST


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OIL PRICE HISTORY AND 2004 FORECAST


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SOLAR AND WIND ARE LIKELY TO DOMINATE THE FUTURE OF ELECTRICITY


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Source : BNEF

SOLAR AND WIND EXPECTED TO ATTRACT MOST OF NEW INVESTMENT IN

POWER GENERATING CAPACITY


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Source : BNEF

CONTRIBUTION OF WIND AND SOLAR

TO WORLDWIDE ELECTRICITY GENERATION


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One third of electricity will be wind and solar by 2040

Source : BNEF


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THE RENEWABLE ENERGY REVOLUTION

OPPORTUNITIES & CHALLENGES

MAJOR MILESTONES AHEAD


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Electrifying Africa1

POWERING THE DEVELOPING WORLD IS URGENT

AND THE UNTAPPED MARKET IS MASSIVE


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621 million Africans do not have access to electricity

Across the continent only 10% of individuals have access to the electrical grid

More than 80% of the population in Sub-saharianregion do not have access to electricity

Source : IRENA, IEA World Energy Outlook

POWERING THE DEVELOPING WORLD IS URGENT

AND THE UNTAPPED MARKET IS MASSIVE


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Expected growth in electricity demand in sub-saharian Africa (2012-2040)

4,6 % / year

Source : IEA

THE NUMBER OF AFRICANS LACKING ACCESS TO MODERN ENERGY IS

ACTUALLY RISING


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Global population without access to electricity, 2009-40

Source : Undata, IEA, McKinsey

Africa’s share of the world population without access

to electricity



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Policy Debates2

CHOOSING THE RIGHT SUPPORT SCHEME


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Feed-in-tariff versus Auctions ?

Feed-in-Tariff main challenges Auctions main challenges

How to set up the price at the right level ? How to tackle fraudulent behaviours (underbidding strategies, corruption, etc.) ?

How to monitor & control the volumes? How to minimize the additional and redundant development costs

How to adapt to each project specificities? How to manage delays and limit the inevitable inefficiencies in the process?

Tenders mean fixed costs : there is a project size threshold under which auctions are counterproductive.

In the auction process, selecting the right offer requires skills which come with experience : Feed-in-Tariff have often been used to develop a solar industry, create jobs, gain experience, etc. before shifting progressively to tenders at a more mature stage.

COST OF SUPPORT SCHEMES


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0,21

0,79

1,681,92

2,20 2,252,47 2,47 2,47 2,47 2,47 2,47 2,47 2,47

0,18 0,26 0,37 0,48 0,60 0,73 0,84

0

1

2

3

4

M€

CSPE historique

CSPE nouvelle - sc. intermédiaire

The cost of support schemes in France are mainly attributable to old contracts

Source : CRE, ADEME

LOBBYING RISK


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Policy Debates2

Environmental and Social Impact3

JOBS CREATION


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Global Renewable Energy Employment by Technology 2012-2017

Source : IRENA

5.3% growth 1.5 x job growthfrom 2012

43% of all RE jobs are in China


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NIMBY ?


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2

3

Grid Impact4

Policy Debates

Environmental and Social Impact

INTEGRATION OF VARIABLE ELECTRICITY SOURCES IN THE

GRID IS MANAGABLE


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Source : RTE

INTEGRATION OF VARIABLE ELECTRICITY SOURCES IN THE

GRID IS MANAGABLE


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Source : RTE

50% ENR46% NUC

45% ENR47% NUC

40% ENR56% NUC

Keeping thermal power plants connected beyond energy needs

Building new thermal capacities

Increasing demand flexibility

Increasing storage capacities

AMPERE HERTZ VOLTADEME 100% Renewables

Variable renewables back-up costs in each RTE scenario for 2035

ELECTRIC VEHICLES AND THE GRID


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Source : Société Générale

SOME UPCOMING TRENDS


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SOME UPCOMING TRENDS FOR THE INDUSTRY


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Self-consumption1

SELF-CONSUMPTION CAN DELIVER SIGNIFICANT

ENERGY SAVINGS


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Electricity consumer(Commercial, industrial, etc)

Grid

Diesel Generators

$$$$

Electricity consumer(Commercial, industrial, etc)

Grid

Diesel Generators

$

Solar installation

Solar installation can bring diversification of energy sources and reduce dependency on both grid

unreliability and diesel gensets operating costs. It provides a strong hedge against potential future

fuel price inflation.

SELF-CONSUMPTION BUSINESS CASE


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Yearly amortization (10 years) 120 000 €

Financing costs (6% interest rate) 40 000 €

O&M costs (incl. Inverters warranty) 12 000 €

Misc (insurances, etc) 5 000 €

Total 177 000 €

Evaluation of the cost of electricity generated by a solar self-consumption installation (simplified example with indicative numbers)

Installed capacity 1 000 kWp

Yield 1 500 kWh/kWp

Yearly production 1 500 000 kWh

CAPEX 1,2 Millions€

In this example, the cost of electricity can be evaluated at

177 000 / 1 500 000 = 11,8 c€/kWh



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-

5

10

15

20

25

30

35

40

- 5 10 15 20

Ele

ctri

city

cost

(c€

/kW

h)

Time (years)

Electricity cost - diesel generator

Electricity cost - solar installation

Evolution of electricity cost over installation lifetime(simplified example with indicative numbers)

The cost of electricity generated by diesel gensets is uncertain : it relies on fuel market price, local

subsidies, etc.

The cost of electricity generated by a solar installation is fixed and known upfront : it relies solely on

the capex, financing costs and amortization conditions.



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0

5

10

15

20

25

30

35

40

0% 20% 40% 60% 80% 100%

Ele

ctri

city

cost

(c€

/kW

h)

Self-consumption rate(share of consumption covered by solar electricity generation)

Electricity cost - diesel generator

Electricity cost - solar installation

Installation capacity must be adapted to fit the needs and consumption of each site.

Above a certain treshold, the electricity generated in excess must be injected on the grid, providing it

is allowed to do so. If not (or if this excess generation is undervalued), storage capacity addition is

required, which results in electricity cost increase.

Storage capacity addition

Evolution of electricity cost with self-consumption rate(simplified example with indicative numbers)

KEY FIGURES

APPLICATION – SOLAR ROOFTOP ON FUEL SERVICE STATIONS

PORT ELIZABETH, SOUTH AFRICA, 2017

✓ Self-consumption on site : significant savings on electricity bills and diesel generators operating costs

✓ Project delivered in Joint-Venture with Ponticelli Frères


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✓ Capacity 41.2 kWp

✓ Commissionning Dec 2017

✓ Area 400 m²

✓ Power generation 60 MWh/an

✓ Equivalent consumption 20 households

✓ CO2 savings 5 t/year

KEY FIGURES

APPLICATION – PHOTOVOLTAIC ROOFTOP PLANT, ITALY, 2015

✓ Competitive tender won in 2015 for EPC on a logistics warehouse

✓ Self-consumption : all electricity is consumed on site

✓ Savings of 50 000 € / year on electricity bills

✓ Complying with Italian standards on energy efficiency


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✓ Name FM LOGISTIC ✓ Surface 1 300 m²

✓ Installed capacity 200 kWp ✓ Type of structure BIPV

✓ Address Capriata d’Orba ✓ Power generation 250 MWh/y

✓ Country Italy ✓ Eq. consumption of 80 Househ.

✓ Type of power plant Rooftop ✓ Avoided CO2 emission 30 t/year




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Self-consumption1

Storage2

WHY SOLAR AND STORAGE ?


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Energy storage is a key driver to accelerate access to sustainable and competitive energy :- Large scale integration of renewable energy on the grid- Deployment of electricity generation in remote and/or off-

grid areas

SOLAR & STORAGE : A CASE STUDY


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✓ Aleria, Corsica

✓ French national tender dedicated

to non-interconnected areas

(November 2015).

✓ Project awarded in June 2016

✓ Construction work in progress.

Commissioning expected April

2018

SOLAR & STORAGE PILOT PROJECT – KEY FIGURES


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900 kWpinstalled

Produce

1.4 GWh

Supply

500 households

Avoid 92t.CO2 p.a.

4 agricultural hangars for fodder storage, equipped with

building integrated solar rooftops (4 400 m²) and Li-Ion

batteries (1 MWh capacity)

SOLAR & STORAGE PILOT PROJECT – DESIGN AND SIMULATION


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Storage with such ratios (~ 1 kWh / kWp) brings various benefits :- Smoothing the variability of the production- Producing power at evening peak time- Predicting the day-ahead production with high precision (1 minute interval)

LITHIUM-ION BATTERY PACK PRICE, GLOBAL AVERAGE, $ PER

KWH


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Source : UNEP

LITHIUM-ION BATTERY PRICES, HISTORICAL AND FORECAST


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Source : BNEF

SOLAR & STORAGE ALREADY COMPETITIVE WITH

ALTERNATIVE OFF-GRID SOLUTIONS


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Small rooftops (100-250 kWp)

Large rooftops (250 kWp-1.5 MWp)

Ground mounted(250 kWp - 5 MWp)

Average weighted price (€/MWh)

198.5 138 81.5

Source: Energy Regulatory Commission (« rapport de synthèse de la CRE relatif à l’appel d’offres portant sur la réalisation et l’exploitation d’installations de production d’électricité à partir de techniques de conversion du rayonnement solaire d’une puissance supérieure à 100 kWc et situées dans les zones non interconnectées »)

SOLAR & STORAGE ALREADY COMPETITIVE WITH

ALTERNATIVE OFF-GRID SOLUTIONS


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Small rooftops (100-250 kWp)

Large rooftops (250 kWp-1.5 MWp)

Ground mounted(250 kWp - 5 MWp)

Average weighted price (€/MWh)

198.5 138 81.5

Source: Energy Regulatory Commission (« rapport de synthèse de la CRE relatif à l’appel d’offres portant sur la réalisation et l’exploitation d’installations de production d’électricité à partir de techniques de conversion du rayonnement solaire d’une puissance supérieure à 100 kWc et situées dans les zones non interconnectées »)

Alternative off-grid solution : diesel generator

Low end High end

LCOE ($/MWh) 197 281

LCOE (€/MWh) 167 239

Source: Lazard’s Levelized Cost of Energy Analysis—Version 11.0Distributed diesel generator with reciprocating engine. Low end represents 95% capacity factor (i.e., baseload generation in poor grid quality geographies or remote locations). High end represents 10% capacity factor (i.e., to overcome periodic blackouts). Assumes replacement capital cost of 65% of initial total capital cost every 25,000 operating hoursHypotheses : fuel price 18.23 $/MMBtu, USD/EUR 1.177

THE BATTERY INDUSTRY PRODUCTION CAPACITIES

DOMINATED BY ASIA


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Self-consumption1

Storage2

Corporate PPAs3

GLOBAL VOLUME OF CORPORATE POWER PURCHASE AGREEMENTS

SIGNED, BY REGION, 2008-2017, IN GW


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Source : BNEF



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Self-consumption1

Storage2

Corporate PPAs3

Electric mobility4

GLOBAL SALES OF ELECTRIC VEHICLES 2012-2017,

THOUSANDS


74

Source : UNEP

ELECTRIC VEHICLE OUTLOOK 2040


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One third of cars and light trucks will be electric by 2040

Source : BNEF

BATTERY AVAILABILITY AND PRICES


76

Source : BNEF

ZOOM ON TESLA’S CHALLENGING GOALS


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Source : BNEF



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Self-consumption1

Storage2

Corporate PPAs3

Electric mobility4

Business model shift4

THANK YOU FOR YOUR ATTENTION

Contact :

Antoine HUARDHead of [email protected]+33 7 77 26 71 55

GENERALE DU SOLAIRE69 rue de Richelieu

75002 PARISThe Renewable Energy Revolution:

Opportunities, Challenges & Perspectives80

mailto:[email protected]

THE RENEWABLE ENERGY REVOLUTION OPPORTUNITIES … · KEY FIGURES PHOTOVOLTAIC ROOFTOP PLANT IKEA STORE, PARIS AREA, 2016 Ikea Store in the Paris area 100 % self –consumption : all

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