GLOBAL TRENDS IN CLEAN ENERGY INVESTMENT Bloomberg EMEA Summit London, 12 October 2015
Michael Liebreich Chairman of the Advisory Board Twitter: @mliebreich
NEW INVESTMENT IN CLEAN ENERGY 2004–14 ($BN)
400
600
7%
350
35%
-7%
-8%
12%
500 300
12%
400 250
-9%
Expected 27%
Large hydro
200 300
Other
50%
Solar
150
200
30%
Wind
100
100 50
0
0
2004 2005 2006 2007 2008 2009 2010 2011 20122012 20132013 20142015 Q1 2004 2005 2006 2007 2008 2009 2010 2011 2014
Note: Total values include estimates for undisclosed deals. Includes corporate and government R&D, and spending for digital energy and energy storage projects (not reported in quarterly statistics), as well as a BNEF estimate for large hydro investment.
Michael Liebreich
BNEF EMEA Summit, London, 12 October 2015
Source: Bloomberg New Energy Finance
@MLiebreich
1
NEW INVESTMENT IN CLEAN ENERGY Q1 2004-Q3 2015 ($BN)
Note: Total values include estimates for undisclosed deals. Excludes corporate and government R&D, and spending for digital energy and energy storage projects (reported in annual statistics only).
Michael Liebreich
BNEF EMEA Summit, London, 12 October 2015
Source: Bloomberg New Energy Finance
@MLiebreich
2
AMER NEW INVESTMENT IN CLEAN ENERGY BY SECTOR Q1 2004-Q3 2015 ($BN)
Note: Total values include estimates for undisclosed deals. Excludes corporate and government R&D, and spending for digital energy and energy storage projects (reported in annual statistics only).
Michael Liebreich
BNEF EMEA Summit, London, 12 October 2015
Source: Bloomberg New Energy Finance
@MLiebreich
3
APAC NEW INVESTMENT IN CLEAN ENERGY BY SECTOR Q1 2004-Q3 2015 ($BN)
Note: Total values include estimates for undisclosed deals. Excludes corporate and government R&D, and spending for digital energy and energy storage projects (reported in annual statistics only).
Liebreich â—?Michael 13 October 2015
BNEF EMEA Summit, London, 12 October 2015
Source: Bloomberg New Energy Finance
@MLiebreich
4
EMEA NEW INVESTMENT IN CLEAN ENERGY BY SECTOR Q1 2004-Q3 2015 ($BN)
Note: Total values include estimates for undisclosed deals. Excludes corporate and government R&D, and spending for digital energy and energy storage projects (reported in annual statistics only).
Michael Liebreich
BNEF EMEA Summit, London, 12 October 2015
Source: Bloomberg New Energy Finance
@MLiebreich
5
SPAIN NEW INVESTMENT IN CLEAN ENERGY Q1 2004-Q2 2015 ($BN)
12.6
8.6
5.8
4.1
4.44.2
5.7
5.4
4.1
3.9 3.1
2.9 2.0
1.9
1.8
1.8
1.9 0.80.91.0
0.60.4 0.1 0.10.20.1
0.9 0.3
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2
1.0
1.7 1.2 1.2 1.0 1.0 0.7 0.6
2.5 2.0 1.8 1.41.2 0.9
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
'15
Four quarter running average Note: Total values include estimates for undisclosed deals
Michael Liebreich
BNEF EMEA Summit, London, 12 October 2015
Source: Bloomberg New Energy Finance
@MLiebreich
6
ITALY NEW INVESTMENT IN CLEAN ENERGY Q1 2004-Q2 2015 ($BN)
9.3 8.4 7.7 7.1 6.8 5.7
5.4 4.8 4.0 3.7 3.63.6
2.8 0.9
0.9 0.8 0.8 0.4 0.2 0.30.40.4 0.2
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2
1.6 1.6 1.3 0.9 0.81.0 0.60.50.40.6 0.20.2 0.20.30.20.20.20.2
2.3 1.9 1.8 1.6 1.2
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
'15
Four quarter running average Note: Total values include estimates for undisclosed deals
Michael Liebreich
BNEF EMEA Summit, London, 12 October 2015
Source: Bloomberg New Energy Finance
@MLiebreich
7
GERMANY NEW INVESTMENT IN CLEAN ENERGY Q1 2004-Q2 2015 ($BN) 15.0
13.0
11.6 10.7
11.0
8.9
9.0
7.5 7.0
5.5
5.5
5.1
5.0
4.0 3.0
1.8
4.1
4.0
2.6 2.1 1.5
3.1 2.7 2.4
2.8
3.1
4.1 3.7 3.4
8.9 7.67.7
7.1 6.9
6.6 6.4 5.8 5.55.4 4.8
5.1
4.54.64.4
5.0 4.2
4.3
4.3
2.7 2.1
1.92.0 1.5
-1.0
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2
1.0
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
'15
Four quarter running average Note: Total values include estimates for undisclosed deals
Michael Liebreich
BNEF EMEA Summit, London, 12 October 2015
Source: Bloomberg New Energy Finance
@MLiebreich
8
FRANCE NEW INVESTMENT IN CLEAN ENERGY Q1 2004-Q2 2015 ($BN)
1.9
2.1
1.41.6 1.31.2 1.2 0.8 1.0 1.0 0.9 0.9 0.9 0.7 0.70.60.7 0.7
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2
1.01.2 0.80.80.6 0.5 0.20.10.10.10.3
2.1 1.9 1.9 1.8 1.6 1.5 1.1 1.0 1.4 1.41.1 0.5 0.9 0.9 0.8 0.6 0.5
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
'15
Four quarter running average Note: Total values include estimates for undisclosed deals
Michael Liebreich
BNEF EMEA Summit, London, 12 October 2015
Source: Bloomberg New Energy Finance
@MLiebreich
9
UK NEW INVESTMENT IN CLEAN ENERGY Q1 2004-Q2 2015 ($BN)
7.9
5.3 5.3 4.4 4.0 3.4 2.3 1.6 1.2 0.91.11.0 0.9
1.8 1.3 1.2
1.9 1.5 1.0 0.8 0.3
4.0 3.9 3.6
3.1
2.0
2.2
2.5
3.0 2.7
3.0 2.9
1.8
1.2 0.8 0.5
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2
0.8 0.4 0.40.3 0.1
2.1
1.9
4.13.9
4.0
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
'15
Four quarter running average Note: Total values include estimates for undisclosed deals
Michael Liebreich
BNEF EMEA Summit, London, 12 October 2015
Source: Bloomberg New Energy Finance
@MLiebreich
10
SUPPORT SCHEMES FOR LARGE-SCALE RENEWABLES PROJECTS IN THE EU
PAYMENT MECHANISM Feed-in tariff (FiT) Premium Green certificates
Source: Bloomberg New Energy Finance.
Michael Liebreich
BNEF EMEA Summit, London, 12 October 2015
@MLiebreich
11
SUPPORT SCHEMES FOR LARGE-SCALE RENEWABLE ENERGY PROJECTS IN THE EU
PAYMENT MECHANISM Feed-in tariff (FiT) Premium Green certificates ALLOCATION Competitive auctions .
Auctions legislated but yet to be held or pilot auctions only
Source: Bloomberg New Energy Finance.
Michael Liebreich
BNEF EMEA Summit, London, 12 October 2015
@MLiebreich
12
SUPPORT SCHEMES FOR LARGE-SCALE RENEWABLE ENERGY PROJECTS IN THE EU
PAYMENT MECHANISM Feed-in tariff (FiT)
Premium Green certificates ALLOCATION
Competitive auctions .
Auctions legislated but yet to be held or pilot auctions only SUBSIDY BUDGET
Capped
Frozen / no new support
Source: Bloomberg New Energy Finance.
Michael Liebreich
BNEF EMEA Summit, London, 12 October 2015
@MLiebreich
13
PRINCIPAL STATE- AND NATIONAL-LEVEL POLICY MECHANISMS FOR RENEWABLES PROJECTS (IN FORCE OR PROPOSED)
Market-based mechanisms – eg, auctions, renewable energy certificate schemes, renewable portfolio standards Feed-in tariff/premiums Country switched to auction or tender programme since 2010
Michael Liebreich
BNEF EMEA Summit, London, 12 October 2015
@MLiebreich
14
LEVELISED COST OF ELECTRICITY 2014 ($/MWH) Marine - wave Marine - tidal STEG - LFR STEG - parabolic trough STEG - tower & heliostat Wind - offshore PV - thin film PV - c-Si PV - c-Si tracking Biomass - anaerobic digestion Biomass - gasification Biomass - incineration Municipal solid waste Geothermal - binary plant Wind - onshore Small hydro Large hydro Landfill gas Geothermal - flash plant Natural gas CCGT Coal fired CHP Nuclear
1037 844
PV projects as low as $58/MWh Onshore wind as low as $37/MWh
0
100
200
300
Q2 2013 central Fossil technologies:
US
400 H1 2014 central
China
Europe
Australia
Note: LCOEs for coal and CCGTs in Europe and Australia assume a carbon price of $20/t. No carbon prices are assumed for China and the US.
Michael Liebreich
500
BNEF EMEA Summit, London, 12 October 2015
Source: Bloomberg New Energy Finance
@MLiebreich
15
THE ROAD TO PARIS
Image: UNFCCC
Michael Liebreich
BNEF EMEA Summit, London, 12 October 2015
@MLiebreich
16
G7 JUNE 2015 – SCHLOSS ELMAU
Emissions must be cut 40-70% by mid-century and phased out entirely by 2100
Picture: Wikimedia
Michael Liebreich
BNEF EMEA Summit, London, 12 October 2015
@MLiebreich
17
LAUDATO SI – DEMAND SIDE
There is an urgent need to develop sources of renewable energy.
Pope Francis Picture: Wikimedia
Michael Liebreich
BNEF EMEA Summit, London, 12 October 2015
@MLiebreich
18
THE ECONOMIST COVER, “SHEIKHS VERSUS SHALE” DECEMBER 2014
Source: The Economist
Michael Liebreich
BNEF EMEA Summit, London, 12 October 2015
@MLiebreich
19
WTI CRUDE OIL PRICES, 2000–2015 ($2015 / BARREL) 180 160 140 120 100
or
80 60 40
?
20 0 2000
2002
2004
2006
2008
2010
2012
Note: The Green line represents the WTI Spot price, and has been adjusted for inflation and is represented here in real 2015 US$
Michael Liebreich
BNEF EMEA Summit, London, 12 October 2015
2014
Source: Bloomberg New Energy Finance, EIA, World Bank
@MLiebreich
20
OIL AND GAS PRICES: HENRY HUB, NBP, BAFA, AND NE LNG, 2004–15 (US$/MMBTU) 20 18
20
16
18 16
14
NBP (UK)
14
12
12
10
Henry Hub (US)
10
8 BAFA (Germany border price for Russian gas)
8 6 6
4
North East Asia LNG 4
2 2
0 2004
2005
2006 0 2007
2008
2009
2010
2011
2012
2013
2014
Note: Japan-Korea Marker is based on broker assessments of the spot price of un-contracted LNG cargoes delivered into the Northeast Asia market.
Michael Liebreich
BNEF EMEA Summit, London, 12 October 2015
2015
Source: Bloomberg New Energy Finance, ICAP, Platts
@MLiebreich
21
AN AGE OF ENERGY PLENTY…
… AGE OF COMPETITION Michael Liebreich
BNEF EMEA Summit, London, 12 October 2015
@MLiebreich
22
US SHALE GAS PRODUCTION BY FIELD, 2000–2015 BCFD 50
45 40
40
Marcellus
35
Marcellus
Haynesville
Haynesville
30
Eagle Ford
25
Fayetteville Barnett
Eagle Ford Fayetteville
30
Barnett Woodford 20
Bakken Woodford
20
AntrimBakken
15
Utica Antrim Rest of US 'shale'
Utica
10
10
Gas rigs online
Other Shale
Oil rigs online
5
0 2000
0 2000
2002 2005
2004
2006
2008 2010
2010
2012
2014 2015
Source: Bloomberg New Energy Finance, EIA
Michael Liebreich
BNEF EMEA Summit, London, 12 October 2015
@MLiebreich
23
AVERAGE LATERAL LENGTH (FEET)
7,000 6,000
+114% 5,000 4,000 3,000 2,000 1,000 0 2011
2012
2013
2014
http://www.slideshare.net/MarcellusDN/range-resources-company-presentation-july-28-2015
Michael Liebreich
BNEF EMEA Summit, London, 12 October 2015
2015
Range Resources, 28 July 2015 , Bloomberg New Energy Finance
@MLiebreich
24
DRILLING COST/LATERAL LENGTH (INCLUDES VERTICAL) ($/FOOT)
1,400 1,200
-71% 1,000 800 600 400 200 0 2011
2012
2013
2014
http://www.slideshare.net/MarcellusDN/range-resources-company-presentation-july-28-2015
Michael Liebreich
BNEF EMEA Summit, London, 12 October 2015
2015
Range Resources, 28 July 2015 , Bloomberg New Energy Finance
@MLiebreich
25
COMPLETION COST/LATERAL LENGTH ($/FOOT)
1,400
-42%
1,200 1,000 800 600 400 200 0 2011
2012
2013
2014
http://www.slideshare.net/MarcellusDN/range-resources-company-presentation-july-28-2015
Michael Liebreich
BNEF EMEA Summit, London, 12 October 2015
2015 Range Resources, 28 July 2015 , Bloomberg New Energy Finance
@MLiebreich
26
WELL COST/LATERAL LENGTH ($/FOOT)
2,500
-57% 2,000
1,500
1,000
500
0 2011
2012
2013
2014
http://www.slideshare.net/MarcellusDN/range-resources-company-presentation-july-28-2015
Michael Liebreich
BNEF EMEA Summit, London, 12 October 2015
2015 Range Resources, 28 July 2015 , Bloomberg New Energy Finance
@MLiebreich
27
NORTHEAST GAS PRODUCTION PER RIG (MCFD) 10,000
9,000 8,000
7,000 6,000 5,000 4,000 3,000 2,000 1,000 0 2007 Michael Liebreich
2008
2009
2010
2011
2012
2013
BNEF EMEA Summit, London, 12 October 2015
2014
2015
@MLiebreich
28
MAJOR GLOBAL SHALE FIELDS
Canada
Norway
Poland
UK China Algeria Libya
USA
Mexico
Brazil Australia
200 trillion cubic feet
South Africa Argentina
Note: Technically recoverable shale gas resources shown
Michael Liebreich
Source: EIA Assessment of World Shale Gas Resources, April 2011
BNEF EMEA Summit, London, 12 October 2015
@MLiebreich
29
LNG EXPORT CAPACITY BY COUNTRY/REGION
700 600 500 400 300 200 100
2020
2019
2018
2017
2016
2015
2014
2013
2012
2011
2010
2009
2008
0
Note: For the underlying data to this chart, go to BI LNGGG<GO>
Michael Liebreich
BNEF EMEA Summit, London, 12 October 2015
Other North America Russia East Africa West Africa Australia Other North America Russia West Africa North Africa Indonesia Malaysia Australia Qatar Demand
Operational, under construction or post-FID
800
Pre-FID
(MMTPA)
Source: Bloomberg New Energy Finance
@MLiebreich
30
AUSTRALIA NATIONAL ELECTRICITY MARKET ACTUAL VS FORECAST ELECTRICITY DEMAND FY2004–FY2025 TWh
AUD trillion
260
1.8
240
1.6
220
1.4
GDP 200
1.2
Historical 180
1.0
160
0.8 FY04
FY06
FY08
FY10
FY12
FY14
FY16
FY18
FY20
FY22
FY24
Source: Australian Energy Market Operator, Reserve Bank of Australia, Bloomberg New Energy Finance
Michael Liebreich
BNEF EMEA Summit, London, 12 October 2015
@MLiebreich
31
AUSTRALIA NATIONAL ELECTRICITY MARKET ACTUAL VS FORECAST ELECTRICITY DEMAND FY2004–FY2025 TWh
AUD trillion
260
1.8
2010 240
1.6
220
1.4
GDP 200
1.2
Historical 180
1.0
160
0.8 FY04
FY06
FY08
FY10
FY12
FY14
FY16
FY18
FY20
FY22
FY24
Source: Australian Energy Market Operator, Reserve Bank of Australia, Bloomberg New Energy Finance
Michael Liebreich
BNEF EMEA Summit, London, 12 October 2015
@MLiebreich
32
AUSTRALIA NATIONAL ELECTRICITY MARKET ACTUAL VS FORECAST ELECTRICITY DEMAND FY2004–FY2025 TWh
AUD trillion
260
1.8
2010
2011
240
1.6
220
1.4
GDP 200
1.2
Historical 180
1.0
160
0.8 FY04
FY06
FY08
FY10
FY12
FY14
FY16
FY18
FY20
FY22
FY24
Source: Australian Energy Market Operator, Reserve Bank of Australia, Bloomberg New Energy Finance
Michael Liebreich
BNEF EMEA Summit, London, 12 October 2015
@MLiebreich
33
AUSTRALIA NATIONAL ELECTRICITY MARKET ACTUAL VS FORECAST ELECTRICITY DEMAND FY2004–FY2025 TWh
AUD trillion
260
1.8
2010
2011
240
1.6
220
1.4
GDP 200
1.2
Historical 180
1.0
160
0.8 FY04
FY06
FY08
FY10
FY12
FY14
FY16
FY18
FY20
FY22
FY24
Source: Australian Energy Market Operator, Reserve Bank of Australia, Bloomberg New Energy Finance
Michael Liebreich
BNEF EMEA Summit, London, 12 October 2015
@MLiebreich
34
AUSTRALIA NATIONAL ELECTRICITY MARKET ACTUAL VS FORECAST ELECTRICITY DEMAND FY2004–FY2025 TWh
AUD trillion
260
1.8
2010
2011
240
1.6
220
1.4
GDP 200
1.2
Historical 180
1.0
160
0.8 FY04
FY06
FY08
FY10
FY12
FY14
FY16
FY18
FY20
FY22
FY24
Source: Australian Energy Market Operator, Reserve Bank of Australia, Bloomberg New Energy Finance
Michael Liebreich
BNEF EMEA Summit, London, 12 October 2015
@MLiebreich
35
AUSTRALIA NATIONAL ELECTRICITY MARKET ACTUAL VS FORECAST ELECTRICITY DEMAND FY2004–FY2025 TWh
AUD trillion
260
1.8
2010
2011
240
1.6
2012 220
1.4
GDP 200
1.2
Historical 180
1.0
160
0.8 FY04
FY06
FY08
FY10
FY12
FY14
FY16
FY18
FY20
FY22
FY24
Source: Australian Energy Market Operator, Reserve Bank of Australia, Bloomberg New Energy Finance
Michael Liebreich
BNEF EMEA Summit, London, 12 October 2015
@MLiebreich
36
AUSTRALIA NATIONAL ELECTRICITY MARKET ACTUAL VS FORECAST ELECTRICITY DEMAND FY2004–FY2025 TWh
AUD trillion
260
1.8
2010
2011
240
1.6
2012 220
1.4
GDP 200
1.2
Historical 180
1.0
160
0.8 FY04
FY06
FY08
FY10
FY12
FY14
FY16
FY18
FY20
FY22
FY24
Source: Australian Energy Market Operator, Reserve Bank of Australia, Bloomberg New Energy Finance
Michael Liebreich
BNEF EMEA Summit, London, 12 October 2015
@MLiebreich
37
AUSTRALIA NATIONAL ELECTRICITY MARKET ACTUAL VS FORECAST ELECTRICITY DEMAND FY2004–FY2025 TWh
AUD trillion
260
1.8
2010
2011
240
1.6
2012 220
2013
1.4
GDP 200
1.2
Historical 180
1.0
160
0.8 FY04
FY06
FY08
FY10
FY12
FY14
FY16
FY18
FY20
FY22
FY24
Source: Australian Energy Market Operator, Reserve Bank of Australia, Bloomberg New Energy Finance
Michael Liebreich
BNEF EMEA Summit, London, 12 October 2015
@MLiebreich
38
AUSTRALIA NATIONAL ELECTRICITY MARKET ACTUAL VS FORECAST ELECTRICITY DEMAND FY2004–FY2025 TWh
AUD trillion
260
1.8
2010
2011
240
1.6
2012 220
2013
1.4
GDP 200
1.2
2014 Historical 180
1.0
160
0.8 FY04
FY06
FY08
FY10
FY12
FY14
FY16
FY18
FY20
FY22
FY24
Source: Australian Energy Market Operator, Reserve Bank of Australia, Bloomberg New Energy Finance
Michael Liebreich
BNEF EMEA Summit, London, 12 October 2015
@MLiebreich
39
AUSTRALIA NATIONAL ELECTRICITY MARKET ACTUAL VS FORECAST ELECTRICITY DEMAND FY2004–FY2025 TWh
AUD trillion
260
1.8
2010
2011
240
1.6
2012 220
2013
1.4
GDP 200
1.2
2014 Historical 180
1.0
160
0.8 FY04
FY06
FY08
FY10
FY12
FY14
FY16
FY18
FY20
FY22
FY24
Source: Australian Energy Market Operator, Reserve Bank of Australia, Bloomberg New Energy Finance
Michael Liebreich
BNEF EMEA Summit, London, 12 October 2015
@MLiebreich
40
GLOBAL POWER DEMAND GROWTH, 2012-40
DEMAND UNDER NEO WILL BE 15% LOWER IN 2040 THAN IEA NEW POLICIES SCENARIO Negative
Low
Medium
High
Source: Bloomberg New Energy Finance
Michael Liebreich
BNEF EMEA Summit, London, 12 October 2015
@MLiebreich
41
ARA AND NEWCASTLE COAL PRICE 2007â&#x20AC;&#x201C;2015 (2014 US$/TONNE) 300 300
250 250
200 200
150
ARA
150
Newcastle 100 100
50 50
0 2007
0 2007 2008
2008 2009
2009 2010
2010 2011
2011 2012
2012 2013
2013 2014
Note: Prices have been adjusted for inflation according to YoY CPI Index from UK Office of National Statistics
Michael Liebreich
BNEF EMEA Summit, London, 12 October 2015
2014 2015
Source: Bloomberg New Energy Finance, ONS
@MLiebreich
42
NEX CLEAN ENERGY INDEX 2013 â&#x20AC;&#x201C; 2015 YTD
200
150
S&P 500 Oil & Gas NEX
Stowe Global Coal
100
50
0 Jan 13
Apr 13
Jul 13
Oct 13
Jan 14
Apr 14
Jul 14
Oct 14
Jan 15
Apr 15
Jul 15
Note: Values as of 08 September 2015; Stowe and S&P 500 rebased to 100 on 01 Jan 2013
Michael Liebreich
BNEF EMEA Summit, London, 12 October 2015
Oct 15
Source: Bloomberg New Energy Finance
@MLiebreich
43
COAL BANKRUPTCIES
Investment Pte Image: various company sources
Michael Liebreich
BNEF EMEA Summit, London, 12 October 2015
@MLiebreich
44
COAL
The coal business in the United States has kind of died, so weâ&#x20AC;&#x2122;re out of the coal business now. Bill Koch Picture: Forbes
Michael Liebreich
BNEF EMEA Summit, London, 12 October 2015
@MLiebreich
45
DEVELOPING WORLD ENERGY
The greatest crisis society confronts is not a future environmental crisis predicted by computer models but a human crisis today that is fully within our power to solve... with coal. ‘Energy Access For All With Green Coal’ campaign Picture: Peabody Energy
Michael Liebreich
BNEF EMEA Summit, London, 12 October 2015
@MLiebreich
46
AFRICAN PROVERB
“The gazelle does not have to outrun the cheetah It has to outrun the slowest gazelle”
Clean energy
Coal
Oil Sands
Oil
Gas Image: Denis Donohue / Shutterstock
Michael Liebreich
BNEF EMEA Summit, London, 12 October 2015
@MLiebreich
47
US LCOE ($/MWH NOMINAL)
200
Onshore wind 150 Utility-scale PV
100 Natural gas Coal
50
0 2015
2020
2025
2030
2035
2040
Note: Capacity factors â&#x20AC;&#x201C; onshore wind: 25-35%; solar PV: 10-15%
Michael Liebreich
BNEF EMEA Summit, London, 12 October 2015
Source: Bloomberg New Energy Finance:
@MLiebreich
48
EUROPE LCOE ($/MWH NOMINAL)
200
Onshore wind 150 Utility-scale PV
100 Natural gas Coal
50
0 2015
2020
2025
2030
2035
2040
Note: Capacity factors â&#x20AC;&#x201C; onshore wind: 25-35%; solar PV: 10-15%
Michael Liebreich
BNEF EMEA Summit, London, 12 October 2015
Source: Bloomberg New Energy Finance:
@MLiebreich
49
CHINA LCOE ($/MWH NOMINAL)
150
Onshore wind 100
Utility-scale PV
Natural gas 50
Coal
0 2015
2020
2025
2030
2035
2040
Note: Capacity factors â&#x20AC;&#x201C; onshore wind: 25-35%; solar PV: 10-15%
Michael Liebreich
BNEF EMEA Summit, London, 12 October 2015
Source: Bloomberg New Energy Finance:
@MLiebreich
50
INDIA LCOE ($/MWH NOMINAL)
150
Onshore wind 100
Utility-scale PV
Natural gas 50
Coal
0 2015
2020
2025
2030
2035
2040
Note: Capacity factors â&#x20AC;&#x201C; onshore wind: 25-35%; solar PV: 10-15%
Michael Liebreich
BNEF EMEA Summit, London, 12 October 2015
Source: Bloomberg New Energy Finance:
@MLiebreich
51
TOTAL INVESTMENTS PER TECHNOLOGY, 2015-40 (US$ REAL) RENEWABLES TAKE 65% OF THE $12.2 TRILLION POWER INVESTMENT TO 2040
Source: Bloomberg New Energy Finance
Liebreich ●Michael 10/13/2015
BNEF EMEA Summit, London, 12 October 2015
@MLiebreich
52
RENEWABLES TO DOMINATE POWER SUPPLY GROWTH
Renewables are poised to seize the crucial top spot in global power supply growthâ&#x20AC;Ś Affordable renewables are set to dominate the emerging power systems of the world Fatih Birol Chief Economist, IEA Michael Liebreich
BNEF EMEA Summit, London, 12 October 2015
Picture: Mikhail Evstafiev, Wikimedia
@MLiebreich
53
RENEWABLE ENERGY PROPORTION OF POWER GENERATION- INTERMITTENT ENERGY (WIND & SOLAR) , 2014 (%) France 3%
UK 9%
Germany 16%
US 4%
Japan 5%
Mexico 3%
China 5%
0 1-5% 6-10%
11-25% 26-50% 50+%
Brazil 3%
ME + Africa 0%
India 3%
Note: This only shows the combination of wind and solar energy generation. All numbers come from BNEFâ&#x20AC;&#x2122;s New Energy Outlook 2015
Michael Liebreich
BNEF EMEA Summit, London, 12 October 2015
Australia 8% Source: Bloomberg New Energy Finance
@MLiebreich
54
RENEWABLE ENERGY PROPORTION OF POWER GENERATION- INTERMITTENT ENERGY (WIND & SOLAR) , 2040 (%) France 30%
UK 63%
Germany 77%
US 24%
Japan 20%
Mexico 32%
China 37%
0 1-5% 6-10%
11-25% 26-50% 50+%
Brazil 34%
ME + Africa 26%
India 32%
Note: This only shows the combination of wind and solar energy generation. All numbers come from BNEFâ&#x20AC;&#x2122;s New Energy Outlook 2015
Michael Liebreich
BNEF EMEA Summit, London, 12 October 2015
Australia 52% Source: Bloomberg New Energy Finance
@MLiebreich
55
ENERGY SERVICE BATTLEFIELD
Residential tools BundledHEM telecoms, Smart energy and DRhome energy. Residential Integrated smart HIVE home hubs storage energy storage. homes heating Heating controls controls Solar PV and Home Load Energy supply energy monitoring automation disaggregation Bundled telecoms Smart and services and energy Home automation thermostats Registered Smart home energy supplier partnerships/investment
Nest acquisition Smart thermostats, electricity, ??? homeBundled automation entertainment and home automation IHD and smart thermostat HomeKit program Load disaggregation
Behavioural Home engagement Smart automation thermostats and â&#x20AC;&#x2DC;behaviouralâ&#x20AC;&#x2122; DR
HEM tools 1m connected Digital Life home connected customers homeSmart service Smart thermostats thermostats to and load BEMS for DR reduce churn disaggregation and energy
Smart lighting / Smart home Connected home platform home / IoT automation (AT&T)
Bundled telecoms, electricity supply beginning in 2016 DR and retail services
Bundled telecoms, Virtual mobile Smart electricityâ&#x20AC;&#x201C;and operator 80k gas thermostats customers
HEMS platform
Bundled insurance, telecoms and energy
efficiency Bundled electricity telecoms services Home energy management
Michael Liebreich
BNEF EMEA Summit, London, 12 October 2015
@MLiebreich
56
E.ON SPLIT
Michael Liebreich
BNEF EMEA Summit, London, 12 October 2015
@MLiebreich
57
ELECTRIC VEHICLE UPTAKE CARS AND TRUCKS IN USE WORLDWIDE, 2013 1.2 billion
ELECTRIC VEHICLES IN USE WORLDWIDE, 2014 0.75 million (to scale) Source: Bloomberg New Energy Finance, International Organization of Motor Vehicle Manufacturers
Michael Liebreich
BNEF EMEA Summit, London, 12 October 2015
@MLiebreich
58
EV LITHIUM-ION BATTERY PACKS & CRYSTYALLINE SI PV MODULES: HISTORICAL COST REDUCTIONS
Crystalline Si PV Module price (USD/W)
100
10
m=26.3%
1
0 1
10
100 1,000 10,000 Cumulative crystalline PV module production (MW)
100,000
Note: Values from 2010-2014 are based on BNEFâ&#x20AC;&#x2122;s annual battery price index, *2015 based on H1 data. For more see here: https://www.bnef.com/Insight/10299. Cumulative production is based on total EVs sold and their respective battery pack size.
Michael Liebreich
BNEF EMEA Summit, London, 12 October 2015
1,000,000
Bloomberg New Energy Finance
@MLiebreich
59
EV LITHIUM-ION BATTERY PACKS & CRYSTYALLINE SI PV MODULES: HISTORICAL COST REDUCTIONS Cumulative lithium-ion EV battery pack production (MWh) 1
10
100
1,000
10,000
100,000 100
10 10
m=26.3%
1
EV LI-ION BATTERYPACK PRICES HAVE FALLEN 60% SINCE 2010
m=15.5%
0 1
10
100 1,000 10,000 Cumulative crystalline PV module production (MW)
100,000
Note: Values from 2010-2014 are based on BNEFâ&#x20AC;&#x2122;s annual battery price index, *2015 based on H1 data. For more see here: https://www.bnef.com/Insight/10299. Cumulative production is based on total EVs sold and their respective battery pack size.
Michael Liebreich
1
Lithium-ion battery pack price (USD/Wh)
Crystalline Si PV Module price (USD/W)
100
BNEF EMEA Summit, London, 12 October 2015
0 1,000,000
Bloomberg New Energy Finance
@MLiebreich
60
BEIJING, CHINA
Photo: Reuters/NASA
Michael Liebreich
BNEF EMEA Summit, London, 12 October 2015
@MLiebreich
61
DELHI, INDIA
Photo: JE Poirrier, Creative Commons
Michael Liebreich
BNEF EMEA Summit, London, 12 October 2015
@MLiebreich
62
LOS ANGELES, USA
Photo: UCLA
Michael Liebreich
BNEF EMEA Summit, London, 12 October 2015
@MLiebreich
63
PARIS, FRANCE
Photo: Dâ&#x201A;ŹNNI$/Creative Commons
Michael Liebreich
BNEF EMEA Summit, London, 12 October 2015
@MLiebreich
64
LONDON, UK
Photo: HHRCA
Michael Liebreich
BNEF EMEA Summit, London, 12 October 2015
@MLiebreich
65
VW DIESELGATE
Source: Flickriver
Michael Liebreich
BNEF EMEA Summit, London, 12 October 2015
@MLiebreich
66
GAP BETWEEN EUROPEAN TEST AND REAL WORLD EMISSIONS, VARIOUS VEHICLES, 2001-2014 (%)
Source: International Council on Clean Transportation
Michael Liebreich
BNEF EMEA Summit, London, 12 October 2015
@MLiebreich
67
URBAN TRANSPORT REVOLUTION
Images: Transport for London, Zipcar, Uber, Proterra
Michael Liebreich
BNEF EMEA Summit, London, 12 October 2015
@MLiebreich
68
CHANGING UK ELECTRICITY MIX
POWER GENERATED BY SOURCE, 1998-2014 (TWH)
SHARE OF GENERATION, 2015 YTD (%)
450 400
1.9%
350 300
Other Renewables
250
23.8%
Nuclear 200
26.2%
Gas Oil
150
Coal
0.5% 20.1%
27.5%
100 50 0 1998 2000 2002 2004 2006 2008 2010 2012 2014 Michael Liebreich
BNEF EMEA Summit, London, 12 October 2015
@MLiebreich
69
UK HOUSEHOLD ELECTRICITY BILL 2014 (ÂŁ)
700 586
600
29 59
500
Minus ÂŁ30 rebates + >>> Other, 45
124
400
29 59
300
124
139
VAT @ 5%
200
139 235
100
Renewables Obligation, 36
Energy and climate change policies VAT @ 5% Supplier costs and margins
Small-scale Feed-inTariffs, 9
Energy and climate Network costs change policies
Supplier costs and margins Wholesale energy costs
0
235
Note: Real 2014 Sterling.
2014 Michael Liebreich
2014
Network costs Wholesale energy costs
Source: UK DECC Annual domestic energy bills 2013, Bloomberg New Energy Finance,
BNEF EMEA Summit, London, 12 October 2015
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70
UK LCOE BY TECHNOLOTY H2 2015 ($/MWH)
5% PV - c-Si (U)
17% 13% Coal
Natural gas CCGT
36% 44%
19%
Wind - onshore
27% 0
50
100
150
Note: Natural gas CCGT and coal includes a carbon cost of $26/tonne Michael Liebreich
BNEF EMEA Summit, London, 12 October 2015
200
250
Source: Bloomberg New Energy Finance
@MLiebreich
71
UK ENERGY POLICY
Image: Wikimedia Commons
Michael Liebreich
BNEF EMEA Summit, London, 12 October 2015
@MLiebreich
72
IN SUMMARYâ&#x20AC;Ś
The old is dying and the new struggles to be born; in this interregnum a great variety of morbid symptoms appear. Antonio Gramsci Co-Founder & Leader, Italian Communist Party Michael Liebreich
BNEF EMEA Summit, London, 12 October 2015
Picture: Wikimedia Commons
@MLiebreich
73
Thanks! MARKETS Renewable Energy Energy Smart Technologies Advanced Transport Gas Carbon and RECs
SERVICES Americas Service Asia Pacific Service EMEA Service Applied Research Events and Workshops
Unique analysis, tools and data for decision-makers driving change in the energy system sales.bnef@bloomberg.net
Michael Liebreich Twitter: @mliebreich