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A Frost & Sullivan Market Insight By Pinaki Bhadury

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Presentation on theme: "A Frost & Sullivan Market Insight By Pinaki Bhadury"— Presentation transcript:

1 Sustainable Development and Driving Technology Advances in Future Energy
A Frost & Sullivan Market Insight By Pinaki Bhadury Frost & Sullivan (I) Pvt. Ltd. 26th August 2011

2 In the next 20 years, Earth’s Energy demand will increase by 30%, will emit 39% more CO2, Earth’s temperature will rise by 3°C, yet there will be water deficit of 40%!

3 But the World’s Landmass, Water and Environment can’t expand!!
Highlights 1 The world’s population is expected to expand by 35% in the next 40 years 2 This will increase the demand for all the supporting resources – Energy, Water, Air and Landmass 3 In the next 20 years: Energy consumption is expected to increase by 30% Coal consumption will increase by 53% CO2 emission will increase by 39% Water deficit of 40% But the World’s Landmass, Water and Environment can’t expand!!

4 Present Scenario – World
Coal : Billion MT Energy : 510 Quadrillion BTU CO2 : Billion MT Water : 4500 Billion M3 Economy : 65 Trillion $ 2010 6.67 Billion

5 Present Scenario – India
Coal : 549 Million MT Energy : 21 Quadrillion BTU CO2 : 1.61 Billion MT Water : 803 Billion M3 Economy : 1.6 Trillion $ 2010 1.21 Billion

6 World Energy Consumption
Energy Consumption Trend Natural Gas consumption grew the most at 56% in past 20 years Next highest growth was Renewables at 54%, mostly coming from Wind Energy Minimum growth in consumption was by fuel oils at 27% Source : EIA 2010, Washington Energy Usage Fuel Oil continue to be the main source of energy, mainly for transportation use Coal comes in second being used predominantly for power generation followed by industry Natural Gas at third place for power generation, domestic use and industry Source : EIA2010, Washington

7 India Energy Consumption
Energy Consumption Trend In keeping with the global trend, Natural Gas consumption grew highest at 414% in past 20 years Next highest growth was Nuclear at 261% Coal consumption grew by 191% in 20 years Minimum growth in consumption was by Hydroelectricity 68% CAGR growth trends have been almost 4 times more than the world average Source : BP Energy Statistics 2010 Energy Usage Coal continues to be the main source of energy, being used for Electricity Generation Oil comes in second being used predominantly for Transportation Natural Gas at third place for power generation, domestic use and industry Source : BP Energy Statistics 2010

8 World Electricity Generation
Electricity Consumption Trend In 2010, World consumed Twh of electricity This was 79.8% more than what it consumed in 1990 China and US alone consumed 71% of world’s electricity generation China’s consumption grew by 6 times as compared to 1990 While India’s consumption grew by 2.3 times in the last 20 years Though share of electricity in the world is just 8% Electricity Generation Source Coal continues to be the main for Electricity Generation Natural Gas comes in second place followed by Renewables

9 India Electricity Generation
Indian Electricity Scenario Indian electricity generation is fourth highest in the world, very close to Japan’s figure Electricity generation in India has seen a growth of 2.64 times in 20 years Though installed capacity wise coal based plants are only 54% of the total capacity, in generation it is as high as 79% of the total energy consuming 401 Million T of coal India’s coal reserves are estimated at 106 Billion Tonnes, of which only 50 – 55% can be mined as rest is considered to be under eco-sensitive areas However, per capita electricity consumption is only 707 kWH as against a world average of 2000 kWH Indian Energy Consumption Scenario Energy 21 Billion BTU of which Coal 549 Million Tonnes Lignite Million Tonnes Natural Gas Billion M3 Crude Oil Million Tonnes Electricity 811 Billion Units CO2 Generated 1607 Million Metric Tonnes Ash Generated 139 Million MT

10 India’s Energy Consumption Comparison
Country Population in Billion GDP in Trillion $ Energy Electricity Mtoe kg/capita Billion kWH kwh per capita World 6.895 58.260 1.741 United States 0.310 14.119 2285.7 7.373 China 1.341 4.985 2432.2 1.814 India 1.224 1.610 524.2 0.428 922.25 753.47 Japan 0.126 5.069 500.9 3.975 Russia 0.143 1.232 690.9 4.831 Source : EIA Statistics 2010, BP Statistics 2011 & World Bank Accelerated Growth Scenario of Developing Countries – the sleeping giants If India increases its per capita consumption even 50% that of China, and China increases its per capita consumption to 50% that of US, then, The Energy demands will be many times more than the Economic estimates Past data shows that China overtook US in energy consumption and its per capita consumption has been increasing dramatically India has been constrained in its infrastructure and policy issues, hence slow rate of growth in Energy consumption With these two most populous countries’ economy growing at one of the highest rates, soon they will be consuming more energy on per capita basis than estimated This will put a huge pressure on world’s energy resources

11 World’s Resources Used in Electricity Generation by Coal
41% of the World’s electricity was generated using coal The highest contributors were China, US & India This resulted in: Coal consumption of Million Tons CO2 generation of Million Tons India 2010 69% of the India’s electricity was generated using coal One of the highest in the world This resulted in: Coal consumption of Million Tons CO2 generation of 888 Million Tons Source : Frost & Sullivan analysis based on various data sources

12 Environment – Gaseous Emissions
CO2 Emissions Electricity generation and transportation are the biggest contributors to CO2 emissions due to use of coal and fuel oil This trend has increased by 91% & 25% respectively in the last 20 years China is the world’s biggest CO2 emitter followed by US and India India overtook Russia & Japan in CO2 emissions last year European Union has actually decreased their CO2 emissions in the last 10 years Source : IEA, Paris Report on CO2 emission from Fuel Combustion 2010

13 Environmental Hazards of Fossil Fuel
Coal Mining Land: Disturbance of land, forests and biodiversity Water: Depletion of aquifers and changes in drainage pattern. Deterioration in quality of water in receiving water bodies due to mine/washery discharge water Air: Fugitive dust emissions, noise, and ground-level vibrations Coal based Electricity Generation Particulate emissions NOx emissions SO2 emissions Mercury contamination Acid Rain Waste from coal combustion (ash) Legends: Lig. : Lignite based Cos. : Coal based Fuel : Fuel Oil based NG : Natural Gas based Nucl. : Nuclear based Win. : Wind based PV : Photovoltaic SMH : Small Micro Hydro Source : IDAE – Report on Environmental Impacts of the production of electricity, July 2000

14 The Real Cost of Conventional Energy
Associated Cost of Generation from Fossil Fuels The true cost of generation from fossil fuels and sources like nuclear and hydro generation is beyond the cost of capital and operation It should take in to consideration the other costs associated with the source of fuel and the social as well as environmental costs associated with . These costs are: Cost of building the infrastructure apart from the location based costs Cost of rehabilitation of the people at the fuel source Environmental Impact cost Healthcare cost associated with fuel use and residents surrounding the mine areas Source : Frost & Sullivan Analysis Source : IDAE – Report on Environmental Impacts of the production of electricity, July 2000

15 Environment – Water World Water Scenario
The estimated water demand in 2005 was 4208 Billion M3 The estimated fresh water resource of the world is 4222 M3 creating a water shortage in the years to come Water demand is growing at 2% every year or, 40% increase by 2030 With the best efforts, the fresh water source could increase to 4880 M3 and not more. The highest water consumers are (2005 figures) India 740 Billion M3 China 618 Billion M3 Brazil 18.7 Billion M3 South Africa 15.0 Billion M3 Source : 2030 Water Resources Group Report

16 The Road Ahead - Energy Future Demand 2030 - Energy
World’s Energy Demand by 2030 is estimated at Quadrillion BTU An increase by 32% in 20 years The top 3 consumers of Energy would be: China 24% (up from present 16%) USA 15% (down from present 20%) India 5% (up from present 4%) Coal will continue to dominate the fuel share and its consumption will increase by 43% in the next 20 years However, it is estimated that Renewables will see the highest increase in consumption by 59% from present levels Source: EIA, International Energy Statistics database (as of November 2009), web site Projections: EIA, World Energy Projection System Plus (2010). Percentage of world total Source : EIA Energy Outlook

17 Regional Demand Trends
Looking Ahead – Energy Regional Demand Trends Maximum demand growth would come from Asia – 74% over the next 20 years The next highest demand growth would come from Middle East – 59% growth Coal consumption in China will see a sharp rise between and 2030 77% of coal demand in the next 20 years will come from China Whereas the rise in demand from India would be 48% These two countries along with the traditional user, US would consume most of the coal resources of the world They shall also continue to be the highest emitters of CO2 and use large quantities of water for coal based power generation It is estimated that by 2030 India may equal today’s China’s CO2 emission value of 7711 Billion Tons*, due to its sheer energy demands unless CO2 emission reduction steps are taken * Source : Carbon Web – ‘An Atlas of World Pollution’

18 Looking Ahead – Water Demands
Water Demand Trends Global demand for fresh water will increase from to 6900 Billion M3 by 2030 All the fresh water resources taken together has a capacity of Billion M3 , creating a shortage of Billion M3 or 40% of the demand India which has a shortage of fresh water resources, will be worst hit with maximum deficit of 50% of its demand unless steps are taken for water conservation Source: Recreated chart from 2030 Water Resource Group Report – “Charting our Water for Future 2010” Source: 2030 Water Resource Group Report – “Charting our Water for Future 2010”

19 Alternatives and Solutions
CO2 Mitigation Solutions Use of Renewable Energy Solar PV Solar Thermal Wind – Macro & Micro Wind Turbines Fuel Cells Geothermal Energy Tidal Energy Government funding key to success In the next 20 years, US 150 Billion Dollars has to be invested in renewable technologies Source : IEA World Energy Outlook 2010 , IEA Cogeneration & Renewables 2011

20 Alternatives and Solutions
Efficiency Enhancement Solutions Efficiency of coal- and gas-fired electricity generation in Major Economies in 2008 Coal & Gas Fired Plants Energy Supercritical Cycle IGCC Coal to Liquid (CTL) Coal to Gas (CTG) Coal Bed Methanation (CBM) Carbon Capture & Storage (CCS) Distributed Generation Cogeneration Plants – efficiencies up to 90% Trigeneration Plants - efficiencies above 75% to 92% Stirling Engines using waste heat Biomass based energy generation Demand Side Management – has the potential to save energy demand by at least 20% Coal-fired electricity generation in Major Economies, by plant type Water Scarcity Mitigation Sea Water Desalination for Power Plants Water Recycle & Reuse Waste Water Recycle & Reuse Stop Water Wastage Source : Opportunities to Transform the Electricity Sector in Major Economies – © OECD/IEA 2010

21 Emerging Technologies for the Future
Photosynthetic Bioelectricity Superconducting Materials Photosynthesis is one of the most efficient ways of producing energy. Found in all plants, it is the most efficient and environment-friendly way of converting the sun’s energy into electrical or other types of energy. Scientists are working on further development of this method of energy conversion At very low temperatures, between -320 °F (-196 °C) and -460 °F (-273 °C), certain metal and ceramic materials conduct electricity with virtually no resistance. Wires made of these superconducting materials can transmit times more electricity than traditional copper wires without any losses in efficiency Once commercialized will reduce the size of electrical equipment drastically and increase efficiency many folds

22 Recommendations Energy consumption must be a balanced mix of conventional and renewable sources. To promote higher use of renewables and increase its viability Energy Planning Old plants using out dated technologies with plant efficiencies less than 27 percent must be either renovated or replaced with modern technologies like Supercritical or IGCC Renovation and Retirement Reward those who use higher efficiency plants, gadgets or use renewables as their energy source, instead of penalizing them for non-compliance. In this regard, the initiative taken in India by the Bureau of Energy Efficiency (BEE) is commendable. Reward instead of Penalty Policies facilitating the growth of renewable energy in the existing basket of energy resources must be enforced by the leading energy users of the world. Policies Budgetary support from the governments is required. Creating a fund from a cess collected from users of conventional energy sources and inefficient plants and products can generate the requisite funding resource. Funding

23 Recommendations Quick adoption of new renewable technologies will be required if environmental degradation and energy shortage has to stop in this world. Quick Adoption of New Technologies increased distributed generation share in the electricity generation portfolio must be adopted, especially for countries where abundant natural resources are available and are short of the conventional sources of energy like coal, oil, and gas. A policy to support integration of distributed generation into the national grid of large plants will go in a long way in its growth Distributed Generation With about percent (in India it is as high as 30 – 32 percent, though not all of it is technical loss) of the energy generated being lost in transmission and with the inclusion of more distributed generation in the system, smart grids will play an important role in ensuring availability of energy at the right place, right time and right quality. Smart Grids Since demand is the main reason for the increase in energy use and therefore searches for more energy resources, demand side management will help keep the need for more energy under check, and control and will be one of the easiest ways to meet the challenges of increased energy demand and preserve the environment. Demand Side Management through regulations

24 Thank You www.frost.com Pinaki Bhadury FROST & SULLIVAN (I) Pvt. Ltd.
Vice President – Strategy Consulting (South Asia, Middle East & North Africa) FROST & SULLIVAN (I) Pvt. Ltd. Focus Building, Baner Road, Pune , Maharashtra, India Tel: (Direct); Mobile: Fax:


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