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The Global Low-Carbon Energy Transition
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The Global Low-Carbon Energy Transition
1.
IEA © OECD/IEA 2017 The Global Low-Carbon
Energy Transition Dr. Fatih Birol, Executive Director, International Energy Agency Generation Energy, Winnipeg, Canada, 11 October 2017
2.
© OECD/IEA 2017 The global energy
context today Ø Global energy markets are changing rapidly Ø North America is entering a new age of energy Ø Solar at records highs, driven by policy support & cost reductions Ø Electric car sales are growing exponentially Ø Digitalization is having profound impacts on the energy sector Ø Local air pollution remains a key driver of energy policy Ø Current climate pledges fall short of meeting mitigation goals
3.
© OECD/IEA 2017 Global energy-related CO2 emissions 5 10 15 20 25 30 35 1970 1975
1980 1985 1990 1995 2000 2005 2010 2014 2015 2016 Gt IEA analysis shows that global CO2 emissions remained flat in 2016 for a third consecutive year, although the global economy grew; changes to the fuel mix and energy efficiency played key roles Global CO2 emissions flat for 3 years – an emerging trend?
4.
© OECD/IEA 2017 Supply-side investment needs to be re-directed, not increased; demand-side investment for energy efficiency, electrification & renewables needs to ramp up significantly Renewables and efficiency
are key to global climate change mitigation Gt 18 22 26 30 34 38 2010 2020 2030 2040 Central Scenario Efficiency Renewables CCS Nuclear Fuel switching Other 2 °C Scenario Global CO2 emissions reductions in the Central & 2 °C Scenario by technology
5.
© OECD/IEA 2017 The power sector
is at the heart of the energy transition More flexible power systems, including dispatchable hydro, and targeted policies are needed to integrate larger shares of wind and solar in a secure and cost-effective way Share of wind, solar, and hydropower in total electricity generation in selected countries, 2016 0% 10% 20% 30% 40% 50% 60% 70% Canada Denmark Spain Italy China Germany United Kingdom India Wind and solar PV Hydropower
6.
© OECD/IEA 2017 Price discovery through competitive auctions effectively reduces costs along the entire value chain; Auctions with long-term contracts will drive almost half of new capacity growth Announced wind and solar PV average auction prices by commissioning date Competition driving renewables
costs down 0 20 40 60 80 100 120 140 160 180 2012 2013 2014 2015 2016 2017 2018 2019 2020 USD/MWh Onshore wind average auction price Solar PV average auction price
7.
© OECD/IEA 2017 Petrochemical Other Transport 70 75 80 85 90 95 Oil demand (mb/d)Transport sector transition
- Trucks drive global oil demand Trucks were responsible for nearly 40% of the growth in global oil demand since 2000; they are the fastest growing source of oil demand, in particular for diesel 2000 2015Increase by sector Trucks Cars Other transport
8.
© OECD/IEA 2017 CO2 emissions growth in the Reference Scenario, 2015-2050 A modern truck
sector is still a long haul away Nearly 40 countries have fuel efficiency standards for cars; Only Canada, China, Japan and the United States have standards for trucks Power sector Industry sector 100 200 300 400 500 600 700 800 900 Trucks Coal use Mt
9.
© OECD/IEA 2017 The potential of
clean energy technology remains under-utilised Recent progress in some clean energy areas is promising, but many technologies still need a strong push to achieve their full potential and deliver a sustainable energy future Energy storage Solar PV and onshore wind Building construction Nuclear Transport – Fuel economy of light-duty vehicles Lighting, appliances and building equipment Electric vehicles Energy-intensive industrial processes Transport biofuels Carbon capture and storage More efficient coal-fired power ●Not on track ●Accelerated improvement needed ●On track
10.
R&D funding for clean energy has remained steady at around $37 billion/year, leaving significant room for growth Global clean energy R&D funding needs a strong boost Global R&D spending on clean energy and electricity networks Top 3 IT company R&D spending 0 10 20 30 40 2012 2015 USD (2016) billion Private
Public 0 10 20 30 40 2012 2015 USD (2016) billion
11.
© OECD/IEA 2017 The global energy
transition and Canada Ø An energy transition of exceptional scope, depth & speed is needed to address energy & environmental objectives Ø In the transition to low carbon fuels, Canada also has a key role to play as a source of reliable oil & gas supply to global markets Ø Federal / Provincial / Territorial collaboration is needed to fully capitalise on Canada’s clean energy opportunities Ø Energy RD&D investment & technology innovation in Canada requires long-term energy & climate policies Ø IEA stands ready to support Canada during its Presidency of 2018 G7 and of 2019 Clean Energy Ministerial
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