Renewable Energy Market Outlook The 5th Northeast Asia Energy Security Forum Ali Izadi December 12, 2017
Analysis to help you understand the future of energy Solar Wind Power and Utilities Gas Carbon Markets & Climate Energy Smart Technologies Storage Electric Vehicles Mobility and Autonomous Driving Frontier Power Emerging Technologies Americas Europe, Middle East & Africa Asia Pacific 1 December 12, 2017
Global new clean energy investment 500.00 160.00 140.00 400.00 300.00 200.00 100.00 0.00 $62bn $88bn $128bn $175bn $205bn $207bn $276bn $317bn $291bn $269bn $315bn $349bn $287bn $258bn (estimate) 120.00 $300 billion 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 100.00 80.00 60.00 40.00 20.00 0.00 Source: Bloomberg New Energy Finance. 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). Excludes large hydro. 2 December 12, 2017
Global new clean energy investment and capacity installations 500.00 160GW 160.00 140.00 400.00 300.00 200.00 100.00 0.00 20GW $62bn $88bn $128bn $175bn $205bn $207bn 88GW $276bn $317bn $291bn $269bn $315bn $349bn $287bn $258bn (estimate) 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 120.00 $300 billion 100.00 80.00 60.00 40.00 20.00 0.00 Source: Bloomberg New Energy Finance. Note:Total values include estimates for undisclosed deals. Includes corporate and government R&D, and spending for digital energy and energy storage projects (not reported in quarterly statistics). Excludes large hydro. 3 December 12, 2017
Solar technology is getting cheaper, faster 2016 ($/W) 100 1976 10 1985 2003 2008 1 2015 2017 (estimate) 0.1 1 10 100 1,000 10,000 100,000 1,000,000 Cumulative capacity historic prices (Maycock) Chinese c-si module prices (BNEF) Experience curve at 28% Source: Maycock, Bloomberg New Energy Finance 4 December 12, 2017
BNEF global benchmark capex forecast for fixed-axis utility-scale systems $/W (DC - 2016 real) $3.24 $1.85 $1.14 $0.86 $0.70 $0.59 $0.51 $0.45 $0.48 $0.29 $0.22 $0.18 $0.15 $0.12 2010 2016 2020 2025 2030 2035 2040 Module Inverter Balance of plant EPC Other System cost Source: Bloomberg New Energy Finance 5 December 12, 2017
Turbine price by delivery date million Euro/MW 3.0 2.5 2.0 1.5 1.0 0.5 0.0 1980 1984 1988 1992 1996 2000 2004 2008 2012 2016 2020 Global (ex. China) Germany (ExTool) Denmark (Extool) US (LBL) China (BNEF) Vestas global Source: Bloomberg New Energy Finance Note: Data by contract signing date 6 December 12, 2017
Onshore wind is getting cheaper as capacity factors rise Onshore wind capacity factor Capacity factor forecast for the U.S 60% 50% 40% 30% 20% 10% 299MW 70% 60% 50% 40% 30% 20% 0% 198019841988199219962000 200420082012 20162020 Germany Denmark UK Spain US Canada Source: Bloomberg New Energy Finance Note: Note: Averages are capacityweighted. We calculate the capacity factor with our proprietary Wind Farm Capacity Factor Tool using real project data and wind resource data provided by 3TIER and Vaisala. We assume P90 value in the capacity factor tool. 10% 0% 2017 2020 2025 2030 2035 2040 Source: Bloomberg New Energy Finance Notes: Line shows central case, error bars reflect the range between low speed and high speed sites 7 December 12, 2017
Evolution of wind turbine heights and output 300m 200m 100m 1.2 MW 2 MW 1-12kW 0.5 MW 19 th C 1990 1995 2000 Sources: Various; Bloomberg New Energy Finance 8 December 12, 2017
Evolution of wind turbine heights and output 300m 200m 4 MW 100m 1.2 MW 2 MW 1-12kW 0.5 MW 19 th C 1990 1995 2000 2005 Sources: Various; Bloomberg New Energy Finance 9 December 12, 2017
Evolution of wind turbine heights and output 300m 200m 7 MW 4 MW 100m 1.2 MW 2 MW 1-12kW 0.5 MW 19 th C 1990 1995 2000 2005 2010 Sources: Various; Bloomberg New Energy Finance 10 December 12, 2017
Evolution of wind turbine heights and output 300m 200m 7 MW 9 MW 4 MW 100m 1.2 MW 2 MW 1-12kW 0.5 MW 19 th C 1990 1995 2000 2005 2010 2015 Sources: Various; Bloomberg New Energy Finance 11 December 12, 2017
Evolution of wind turbine heights and output 300m 13-15 MW 200m 7 MW 9 MW 4 MW 100m 1.2 MW 2 MW 1-12kW 0.5 MW 19 th C 1990 1995 2000 2005 2010 2015 2025 Sources: Various; Bloomberg New Energy Finance 12 December 12, 2017
Offshore wind has surprised us $/MWh (2016 $) 250 200 150 100 50 Anholt BNEF central view Denmark Borssele I & II Borssele III & IV Danish near-shore Completed auction CfD-R1-East Anglia 1 Horns Rev III Zuid I & II Netherlands CfD-R1-Neart na Goithe Zuid III & IV CfD-Round 2 Noord Gode Wind 3 Germany He Dreiht BRW II, OWP West CfD-Round 3 Krieger's Flak 0 2012 2014 2016 2018 2020 2022 2024 2026 2028 U.K. Planned auction Historical BNEF central LCOE BNEF LCOE range (H2 2016) Source: Bloomberg New Energy Finance Note: Projects by commissioning date. Full dots show the project level LCOEs have been estimated using winning tariffs, tariff duration, indexation (if applicable) and a power price assumption for the merchant tail. 13 December 12, 2017
H1 2012 H2 2012 H1 2013 H2 2013 H1 2014 H2 2014 H1 2015 H2 2015 H1 2016 H2 2016 MWh $/kwh BNEF 2016 li-ion battery price survey results 2012-2016 1,600 1,400 689 642 599 1,200 1,000 Range between minimum and maximum price reported 800 600 400 200 H1 2012: $689/kWh H2 2012: $642/kWh H1 2013: $599/kWh H1 2014: H2 2014: $568/kWh $540/kWh 19% learning rate H2 2015: $350/kWh 2016: $273/kWh Volume-weighted average battery price 0 2,500 2,000 1,500 1,000 500 0 1,500 1,000 500 0monthly MWh of sales H of batteries in 2 1 new EVs Source: Bloomberg New Energy Finance, survey participants. 14 December 12, 2017
Clean energy investment in APAC APAC China Billion USD Billion USD 48 46 43 43 38 37 36 33 33 34 31 32 31 28 28 28 26 26 22 20 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2012 2013 2014 2015 2016 2017 34 32 30 25 27 28 26 26 24 19 20 18 19 19 16 18 17 13 14 8 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2012 2013 2014 2015 2016 2017 Japan Korea Billion USD Billion USD 6 8 8 8 8 9 9 9 9 8 8 8 7 3 3 3 4 3 3 2 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2012 2013 2014 2015 2016 2017 0.1 0.4 0.6 0.2 0.1 0.3 0.4 0.2 0.5 0.5 0.4 0.3 0.3 0.3 0.2 0.2 0.4 0.3 0.3 0.6 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2012 2013 2014 2015 2016 2017 15 December 12, 2017
Renewable energy (excluding large hydro) proportion of power generation, 2006-16 Canada UK 25% China 5% 6% 2% Germany 29% 6% 10% 9% Japan US 3% 9% Spain 30% Italy 7% 12% 13% 25% Lowest 12% India Mid Highest No data 6% Brazil 18% South Africa 4% 6% 3% Australia 12% 1% 3% Source: Bloomberg New Energy Finance 16 December 12, 2017
Climatescope 2017 Climatescope coverage, 2017 13 countries in Central Asia and Eastern Europe 3 MENA nations 26 Latin American & Caribbean nations 19 Sub-Saharan Africa nations 10 Asian countries, including 25 states/provinces in India & China OECD Since 2012 Since 2014 Since 2016 Since 2017 Non-OECD not in Climatescope 17 December 12, 2017
China Brazil Jordan Mexico India South Africa Chile Kenya Uruguay Vietnam Senegal Indonesia Pakistan Honduras Turkey Rwanda Uganda Costa Rica Egypt Argentina Mongolia Sri Lanka Nigeria Nepal Peru Colombia Barbados Guatemala Tanzania Ethiopia Bangladesh Ghana Panama Russia Sierra Leone Lebanon Nicaragua El Salvador Liberia Ukraine Georgia Bolivia Ecuador Cameroon Botswana Jamaica Zambia Cote d'ivoire Dominican Republic Belize Moldova Haiti Zimbabwe Kazakhstan Mozambique Armenia Azerbaijan Belarus Kyrgyzstan Myanmar Malawi Bahamas Tajikistan Trinidad & Tobago Congo (Dem. Rep.) Guyana Uzbekistan Venezuela Suriname Paraguay Turkmenistan Climatescope 2017 Ranking and Parameters 3 Enabling Framework Financing & Investment Value Chains Greenhouse-Gas Management 2.5 2 1.5 1 0.5 0 Source: Bloomberg New Energy Finance, Climatescope 2017 18 December 12, 2017
New Energy Outlook 2017 Global electricity generation mix 2016 2040 Utility-scale PV Onshore 1% wind 4% Hydro 17% Nuclear 10% Oil 4% 24,155TWh Gas 23% Coal 37% Small-scale PV 1% Utility-scale PV 12% Onshore wind 15% 38,079TWh Hydro 15% Coal 22% Nuclear 9% Small-scale PV 5% Gas 16% Source: Bloomberg New Energy Finance 19 December 12, 2017
New Energy Outlook 2017 Global electricity generation by fuel type (TWh) 18,000 16,000 Fossil fuel 14,000 12,000 Solar & Wind 10,000 8,000 Other Renewables 6,000 Nuclear 4,000 2,000 0 2012 2016 2020 2025 2030 2035 2040 Source: Bloomberg New Energy Finance 20 December 12, 2017
New Energy Outlook 2017 Investment in new electricity generation capacity by region 2017-2040 ($ trillion 2016 real) Europe $1.2tn $1.3tn Rest of the World Americas $1.5tn $1.5tn Middle East, Turkey and Africa Asia Pacific $4.8tn Source: Bloomberg New Energy Finance Source: Bloomberg New Energy Finance 21 December 12, 2017
New Energy Outlook 2017 APAC: 47% of investment China & India: 83% of investment in APAC Global investment by region, 2017-2040 APAC investment by region, 2017-2040 ($ billion - 2016 real) ($ billion - 2016 real) APAC $4,828 China $2,823 AMER $1,454 India $1,157 META $1,454 SE Asia $431 Japan $195 RoW $1,264 South Korea $142 Europe $1,185 Australia $79 Coal Gas Nuclear Hydro Wind Solar Other Coal Gas Nuclear Hydro Wind Solar Other Source: Bloomberg New Energy Finance 22 December 12, 2017
New Energy Outlook 2017 Renewable penetration ranking by 2040 Country All renewables Country PV and wind Italy 96% Mexico 73% Brazil 96% Iberia 63% Iberia 86% Germany 61% Chile 86% Italy 59% Mexico 82% Chile 55% Canada 79% Australia 55% Germany 74% UK 50% France 65% France 46% UK 63% Brazil 43% Australia 62% India 41% China 55% China 39% India 49% Thailand 39% Thailand 49% SSA 34% Turkey 48% South Korea 32% Philippines 47% United States 31% Japan 42% Japan 30% United States 38% Philippines 30% Malaysia 37% Turkey 28% South Korea 34% MENA 27% Indonesia 31% Canada 24% Source: Bloomberg New Energy Finance 23 December 12, 2017
New Energy Outlook 2017 Power sector emissions peak in 2026 but remain far from 2 trajectory Global power sector CO2 emissions trends and Paris Agreement targets (NDC) (MtCO2) Global power sector CO2 emissions trends and the 2 degree pathway (MtCO2) 16,000 14,000 NDC trajectory 16,000 14,000 NEO2017 12,000 NEO2017 12,000 10,000 10,000 8,000 8,000 6,000 4,000 2,000 6,000 4,000 2,000 NEO2017-2deg trajectory 0 2012 2016 2020 2025 2030 2035 2040 0 2012 2016 2020 2025 2030 2035 2040 Source: Bloomberg New Energy Finance 24 December 12, 2017
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