Presentation on theme: "Our Global Energy Future Looking beyond the economic crisis"— Presentation transcript:
1Our Global Energy Future Looking beyond the economic crisis Mr. Nobuo TanakaExecutive Director International Energy AgencyMinistry of EconomyWarsaw12 May 2009
2Weakening economy drives oil demand revisions IEA April 2008 Oil Market ReportTwo year demand contraction in 08/09 first since early-1980sOECD hit hard, but clear signs that non-OECD is slowing now tooLatest GDP estimates suggest -1.4% for 2009, with consensus of gradual recovery in 2010Prices bottoming-out in the face of OPEC supply cuts, and a degree of post-G20 ‘bounce’
3Evaluating oil supply-side impacts Supply also affected, on weak demand, low prices, credit crunch & investment slippage、2009 forecast already down by 1.7 mb/d since July 2008, excluding 2008 baseline changesCanada & Russia taking a hit in terms of investment & likely output$50/bbl oil unlikely to see extensive shut-ins of current output per seBut impact of lower spend on new projects and prevailing decline rates at mature fields3
4World Oil Production by Source IEA’s World Energy Outlook 2008 Business as Usual Scenario 20 mb/d45 mb/dIEA World Energy Outlook 2008Around 65 mb/d of gross capacity needs to be installed between 2007 & 2030 – six times the current capacity of Saudi Arabia – to meet demand growth and offset decline
5Long-term oil-supply cost curve (with $50 per tonne of CO2) A carbon price of $50 per tonne of CO2 would increase the cost of producing non-conventional oil the most – by as much as $30 per barrel – due to its higher energy intensity
6European Responses to January 2009 Gas Supply Disruption Timeline of Actions7 Jan (immediate)10 Jan.16 Jan.18 Jan.Yamal increaseBBL NL-UK reducedInterconnector UK-BE reversedReverse flow Czech to SlovakiaBlue Stream increaseHungary increase to Serbia & BosniaIncrease Germany -CroatiaIncreasing Croatian production share off-takeReverse flow from Greece to BulgariaAdditional spot LNG to Greece & Turkey
7Cumulative energy supply investment in Business as Usual, 2007-2030 Coal3%Biofuels<1%$0.7 trillion$0.2 trillionPower52%Oil24%Gas21%$13.6 trillion$6.3 trillion$5.5 trillionShipping4%Shipping &Refiningports16%Transmission9%TransmissionPower& distributionExploration && distributiongeneration31%development50%50%Exploration and61%developmentLNG chainMining80%8%91%Investment of $26 trillion, or over $1 trillion/year, is needed, but the credit squeeze could delay spending, potentially setting up a supply-crunch once the economy recovers
8Energy-related CO2 emissions Business as Usual Scenario 51015202530354045198019902000201020202030GigatonnesInternationalmarine bunkersand aviationOECD - gasOECD - oilOECD - coalNon-OECD - gasNon-OECD - oilNon-OECD - coal97% of the projected increase in emissions between 2006 & 2030 comes fromnon-OECD countries – three-quarters from China, India & the Middle East alone
9Energy-related CO2 emissions 450 Policy Scenario Internationalmarine bunkersGigatonnesand aviation40OECD - gasOECD - oil35OECD - coalNon-OECD - gas30Non-OECD - oilNon-OECD - coal252015105198019902000201020202030In the 450 Policy Scenario emissions peak around 2020,and then decline by more than 1/3 to reach 26 Gt in 2030
10Reductions in energy-related CO2 emissions in the 450 Policy Scenario World totalGigatonnesReference Scenario40CCS - 21%Energy Efficiency 54%CCS 14%Nuclear 9%Renewables &biofuels 23%Nuclear - 14%35% (5.2 Gt reduction)Renewables & biofuels - 18%OECD+Energy efficiency - 47%35CCS - 10%Nuclear - 6%Renewables & biofuels - 25%Non-OECD3065% (9.5 Gt reduction)Energy efficiency - 59%450 Policy Scenario2520200520102015202020252030OECD and non-OECD countries must both work towards reducing CO2 emissionsEnergy efficiency plays a key role for both OECD and non-OECD countriesTo inform the international climate negotiations, the IEA will release an early excerpt of the WEO 2009 climate change analysis, to coincide with post-Kyoto negotiations this September
11Total power generation capacity today and in 2030 by scenario Coal1.2 x today1.5 x todayGasNuclear13.5 x today2.1 x today1.8 x today12.5 x today15% of today’s coal & gas capacityHydroWindOther renewablesCoal and gas with CCS1 0002 0003 000GWTodayReference Scenario 2030450 Policy Scenario 2030In the 450 Policy Scenario, the power sector undergoes a dramatic change –with CCS, renewables and nuclear each playing a crucial role
12Roadmaps can accelerate deployment of key clean energy technologies Demand sideEnergy efficiency in buildingsEnergy efficient motor systemsEfficient ICEsHeat pumpsPlug-ins and electric vehiclesFuel cell vehiclesIndustrial CCSSolar heatingEfficient industry processes (starting with Cement)Supply sideCCS power generationCoal – IGCCCoal – USCSCNuclear III + IVSolar – PVSolar – CSPWindBiomass – IGCC & co-combustionElectricity networks2nd generation biofuelsWork has already begun on technologies shown in green, and these roadmaps will be launched later in 2009.
13Global electricity generation (450 ppm Scenario) 1%9%1%18%16%(1%)4%5%40%15%22%20%18%6%18%2%41%21%Renewables and nuclear power will increase
14Nuclear power needs to play a larger role in 2050 Energy Technology Perspectives (ETP) 2008 shows that significant increase of nuclear generation in both OECD countries and non-OECD countries is essential to halve the current level of energy related CO2 emission by 2050.
15USD 128 Billion in energy efficiency stimulus from IEA Countries IEA 25 energy efficiency policy recommendations across 7 priority areas1. Across sectors1.1 Measures for increasing investment in energy efficiency;1.2 National energy efficiency strategies and goals;1.3 Compliance, monitoring, enforcement and evaluation of energy efficiency measures;1.4 Energy efficiency indicators;1.5 Monitoring and reporting progress with the IEA energy efficiency recommendations themselves.2. Buildings2.1 Building codes for new buildings;2.2 Passive Energy Houses and Zero Energy Buildings;2.3 Policy packages to promote energy efficiency in existing buildings;2.4 Building certification schemes;2.5 Energy efficiency improvements in glazed areas.3. Appliances3.1 Mandatory energy performance requirements or labels;3.2 Low-power modes, including standby power, for electronic and networked equipment;3.3 Televisions and “set-top” boxes;3.4 Energy performance test standards and measurement protocols.4. Lighting4.1 Best practice lighting and the phase-out of incandescent bulbs;4.2 Ensuring least-cost lighting in non-residential buildings and the phase-out of inefficient fuel-based lighting.5. Transport5.1 Fuel-efficient tyres;5.2 Mandatory fuel efficiency standards for light-duty vehicles;5.3 Fuel economy of heavy-duty vehicles;5.4 Eco-driving.6. Industry6.1 Collection of high quality energy efficiency data for industry;6.2 Energy performance of electric motors;6.3 Assistance in developing energy management capability;6.4 Policy packages to promote energy efficiency in small and medium-sized enterprises.7. Utilities7.1 Utility end-use energy efficiency schemesUSD 128 Billion in energy efficiencystimulus from IEA Countries
16Impact of financial crisis on global investment in renewable energy 90GeothermalBillion dollars80-38%Marine & small-hydroBiomass70Solar60Wind5020094030201020042005200620072008Renewable energy investment has collapsed due to the financial crisis – which has dried up sources of project finance – and lower fossil-fuel prices ….… IEA G-8 paper estimates spending in 2009 will drop by 38% relative to 2008Source: NEF, IEA analysis
17Carbon Capture and Storage – energy efficiency alone is not enough Average worldwide~28.4%~1110 gCO2/kWh~36%~880 gCO2/kWhEU average~42%~740 gCO2/kWhState-of-the artPC/IGCCgCO2/kWh~48%~665 gCO2/kWhAdvanced R&DCCS<2020but deep cuts only byadapted from VGB 2007; efficiency – HHV,net17
18Carbon Capture and Storage - only 4 full-scale projects exist today G8 goal: 20 full-scale demonstrationsannounced by 2010
19CO2 Storage Prospectivity Source: Bradshaw, J. and Dance, T. (2004): “Mapping geological storage prospectivity of CO2 for the world’s sedimentary basins and regional source to sink matching,” in (E.S. Rubin, D.W. Keith and C.F. Gilboy eds.), GHGT-7, Proc. Seventh International Conference on Greenhouse Gas Control Technologies, Vancouver, B.C., Canada, September 5-9, 2004.
20Shifting to the 450 ppm scenario requires significant investment 5 000450 Policy Scenario(additional to 550)4 000550 Policy Scenario3 000Billion dollars (2007)2 0001 000Power plantsEnergy efficiencyHuge investment in power plants and energy efficiency is required to shift the world onto a 450 ppm trajectory
21Total oil production in 2030 by scenario 120mb/dNon-OPECOPEC1009 mb/d16 mb/d806012 mb/d40202007Reference Scenario550 Policy Scenario2030450 Policy Scenario20302030Curbing CO2 emissions would improve energy security by cutting demand for fossil fuels, but even in the 450 Policy Scenario, OPEC production increases by 12 mb/d from now to 2030
22Summary For energy security need to diversify oil and gas sources must ensure continued supply-side investment to meet oil demand and address production decline in mature fields and investment throughout the gas supply chainFor energy security and climate change mitigationmust invest in low carbon technologies: CCS, renewables, nuclear and energy efficiency must all be embracedEconomic crisis is an opportunity to place a Clean Energy New Deal at the heart of economic stimulus packages everywhere.