State Of The Energy Industry Jan 2006

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state of the energy industry, january 2006

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State Of The Energy Industry Jan 2006

  1. 1. “STATE OF RENEWABLE ENERGY 2006” Presented to: State of the Energy Industry US Energy Association January 17, 2006 Michael Eckhart, President American Council On Renewable Energy www.acore.org
  2. 2. American Council On Renewable Energy TRADE 250 MEMBERS FINANCE 2 POLICY
  3. 3. 2005 in Review • Industry grew 25% to $30 Billion in sales • International policy moved ahead: – Kyoto Protocol went into effect – China passed Renewable Energy Law – Germany confirmed its RE Law • US policy advanced: – Energy Policy Act 2005 with RE Incentives – WGA completed its regional energy plan 3
  4. 4. World and US Oil Dilemma End of an Era … Beginning of an Era PEAK OIL NATIONAL SECURITY 4
  5. 5. Climate Change End of an Era … Beginning of an Era Changes in Atmospheric Concentrations - 1000 Year History concentration CO2 360 310 Atmospheric 340 (ppm) 320 Source: 290 NREL 300 1000 1200 1400 1600 1000 1800 1200 2000 1400 1000 1600 1200 1800 1400 2000 1600 1800 280 270 260 250 5 Source: IPCC Third Assessment Report (2001)
  6. 6. Early Leadership for Renewable Energy European Union Policies Green Certificates Feed-in Tariffs Capital grants, Tax relief … Obligation Tradable certificates 6
  7. 7. China New Renewable Energy Law Effective 1-1-2006 China’s Power Plan (Gigawatts) Year Total RE 2010 650 60 2020 950 120 7
  8. 8. State of the Global RE Market 160,000 MW Installed Growing at 25 GW/Year “NEW RENEWABLES” Plus: INSTALLED BASE (000 MW) 160 720,000 MW Large Hydro 140 Solar Geothermal 220,000 MW (th) Biomass 120 Heating Biomass 100 Windpower 28,000 MW (th) Geothermal 80 Small Hydro Heating 60 77,000 MW (th) Solar Heating 40 1,000 MW of off-grid solar 20 PV systems 0 World DCs EU 25 US Japan Source: Renewables 2005: Global Status Report Total Renewable Energy = 1,206,000 MW Equivalent for Electricity and Heating Around the World 8
  9. 9. The Challenge of Putting RE into Use - Regional Resources, Economics, and Politics - SOLAR ENERGY WIND POWER GEOTHERMAL BIOMASS Resource Potential 9
  10. 10. US Renewable Energy Markets 30% by 2000 24% by 2013 15% by 825 MW 2015 Wind by 8% by 2020 2007 4% new by 2009 10% by 2.2% by 2015 2011 15% by 2019 105 MW 15% by 10% by 2010 2013 8% by 20% by 10% by 2012 6.5% by 2008 2010 2015 7.5% by 2019 10% by 11% by 2021 1.1% by 2011 2007 2580 MW by 2009 Arizona Market* Western Market Upper Midwest Market Texas Market Northeast Market *Arizona may export but not import RECs to/from other states. 10
  11. 11. Projected Impact of RPS Compliance - From 10 GW in 2003 to 40 GW in 2015 - 11
  12. 12. Green Power Marketing Utility Green Pricing Programs Growing at a Steady 40% CAGR Top 10 Green Pricing Programs: Number of Participants 500,000 • Austin Energy • Portland General Electric 400,000 • PacifiCorp • Sacramento 300,000 • Xcel Energy • National Grid 200,000 • LADWP • OG&E Electric 100,000 • Puget Sound • We Energies - +700 MW of RE Capacity Added to 1999 2001 2003 2005E Support Green Pricing Programs Source; Lori Bird, NREL 2005 12
  13. 13. RE Finance is Entering the Mainstream Renewable Energy Global M&A Activity - $ Millions 10000 8000 6000 4000 2000 ACORE’s RE Finance Forum 2005 0 Major IPOs in 2005: 2001 2002 2003 2004 2005 - Q-Cells Germany Estimate - SunPower USA Projects - Suntech Taiwan Technology and Service Cos - Suzlon India Developers 13
  14. 14. Wholesale Power Generation US Wind Power US Wind Power Installations (MW/Year) 3500 3000 Installed 2500 RPS Required New 2000 1500 1000 9,700 MW Installed Base 2005 35,000 MW estimated by 2015 500 Key Issues: . Turbine availability 0 . RPS extension past 2007 1990 1995 2000 2005 2010 . Siting and Transmission Sources: AWEA, GE Wind, and ACORE 14
  15. 15. Location of US Windfarms Per capita income in 1999 45,000 25,000 5,000 Status Completed Proposed Speculative Under development 15
  16. 16. Location of US Windfarms Per capita income in 1999 45,000 25,000 5,000 Status Completed Proposed Speculative Under development 16
  17. 17. Other Wholesale Power Generation Geothermal, Hydropower, and Solar Thermal-Electric Solar Dish- Sterling: 350 MW Contracts 500 MW contracts Solar Trough: 50 MW Under Construction Incremental Hydro 17
  18. 18. Distributed Generation Solar PV $7 Billion/Year Global Industry US Solar PV Installations (MW/Year) 250 Grid 200 Off-Grid 150 Approximate 5,000 MW in place Adding 1,500 MW/year globally 100 Key Issues: 50 . US 30% tax credit . California’s $3.2 B program . Silicon shortage 0 2000 2001 2002 2003 2004 2005 2006 E . Global competition Sources: PV News and ACORE 18
  19. 19. Renewable Fuels US Ethanol and Biodiesel Over $2 Billion Invested in 2005 Million Gallons / Year 5000 4500 4000 3500 Corn-Based 3000 Ethanol 2500 2000 1500 1000 Biofuel options: 500 • Corn-based ethanol fuel 0 1985 1995 2005 • Cellulosic ethanol fuel Source: Renewable Fuels Association and ACORE Est • Bio-diesel - US and Europe 19
  20. 20. “Policies for Phase II” October 17-18, 2005, Cannon Caucus Room, Washington, DC Co-convened with the RE/EE Caucuses of the US Senate and House 20
  21. 21. Renewable Energy Targets and Forecasts % of Total Energy 60% 50% 40% 30% 20% 10% 0% 2000 2010 2020 2030 2040 2050 2060 Global Perspectives A3 Germany Today (Global) IEA World Energy Outlook Ref Shell Dynamics (Global) European Union Navigant (Global) Today (US) Source: Pew Tech Triumphs Policy (US) Aitkin (US) NREL GHG (Hoffert) GPRA05 EERE (US) EIA Reference (US) 21
  22. 22. Renewable Energy Targets and Forecasts % of Total Energy 60% 50% CLIMATE CHANGE 40% 30% 20% 10% USG 0% 2000 2010 2020 2030 2040 2050 2060 Global Perspectives A3 Germany Today (Global) IEA World Energy Outlook Ref Shell Dynamics (Global) European Union Navigant (Global) Today (US) Source: Pew Tech Triumphs Policy (US) Aitkin (US) NREL GHG (Hoffert) GPRA05 EERE (US) EIA Reference (US) 22
  23. 23. “Phase II” of Renewable Energy in America Phase I: “Development” Phase II: “Utilization” – Past 30 Years – Next 30 Years – Focus on RD&D – Focus on National Needs – Develop Technologies: – Implement Solutions: • Wind • Hybrids + Biofuels • Solar • Solar + Efficiency • Hydro • National REC Trading • Geothermal • Transmission • Biomass • Investment • Biofuels • Jobs – “Commercialization” – “Utilization” – Key = Innovative Policy – Key = Stable Policy – Lead: Federal – Lead: State / Federal 23
  24. 24. Summary 1. RE technologies are ready for use 2. Large and growing global market 3. Emerging US market 4. Deployment policy led at the State level 5. Federal incentives -- essential to success 6. US moving to “Phase II” 7. Need for policy stability and commitment 24
  25. 25. Thank You www.acore.org Michael Eckhart American Council On Renewable Energy 202.393.0001 ext.7581 meckhart@acore.org

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