APERC’s Research Activities: Outlook 5th edition

Projection of Renewable Energy Supply in theAPEC Region
Luke Leaver, Researcher
EGNRET 39December, 2012

APEC Energy Outlook•APERC has historically produced an APEC
Energy Demand and Supply Outlook every
2 or 3 years•

5th edition is likely to be published inFebruary 2013•

“Business As Usual” (BAU) – Assumes
existing policy continues, including
policies in process of implementation•

Three Alternative Cases:– High Gas Case
– Better Urban Planning– Virtual Clean Car Race2New Renewable Energy (NRE) Goes
Mainstream•New Renewable Energy (NRE) goes mainstream led by continued policy
support and technology cost reduction•By 2035 NRE energy output will reach 10% of power generation in APEC•Wind energy leads but solar energy rises quickly

3APEC Renewable Energy Policy
Support is Robust
1.

Feed­in­tariffs – utilities required to buy electricity fromrenewables at a guaranteed price2.

Renewable portfolio standards – Requirement of utilities toobtain a minimum fraction of their electricity from renewablesources3.

Carbon pricing – Tax on CO2 emissions, which discourages
the use of fossil fuels

4.

Regulations limiting greenhouse gas emissions – Laws
which prohibit the level of GHG emissions on certain fossilgeneration4

Decline in PV Solar Costs Continues
Oversupply of PV modules caused a large drop (~70%) in prices
between 2008‐2011
Low to negative profitability of PV module manufactures will slow
future module cost reductions
Installation costs are the major expense

Source: Lawrence Berkeley Lab (2012), Tracking the Sun V5Wind Energy Technology Still
Improving
Source: NRELCost competition fromChina continues to reducewind turbine margins
Technology innovation
with lighter and larger
turbines and higher energy
captureCarbon fiber replacing
steel reducing installation
costs
Offshore super turbinesdevelopment ~10MW
Source: Wiser et al. 2012 Recent Developments in theLevelized Cost of Energy From U.S. Wind Power Projects

6Outlook for Renewable Energy has
Improved
4th Edition

2035

2030

2025

2020

2015

2010

2005

China and the USA
account for much ofthe expected growth

1000
900
800
700
600
500
400
300
200
1000

MTOE

Higher projectionof NRE growth thanour last edition in2009

5th Edition

Source: APERC Analysis

7Electricity Sector Leads Growth in
Renewables
Renewable Primary Energy Supply

High growth inrenewable energy inthe electricity sector

800

Biomass for cooking
and heating usuallylarge in early economic
development

500

OtherDomestic Transport

Non-Direct (Electricity)

700

400
300
200
100

PRC

USA

INA

35

20

1035201035201035

020

MTOE

600

10

Growing use ofgeothermal/solar for
direct heatingIndustry

Other APEC

Source: APERC Analysis
8

APEC NRE Outlook in the Power Sector
by TechnologyBiomass
150& Biogas

2005

201020202035

US EPA regulations on Coalemissions will increase theblending of biomass

TWh100Growth projected within anumber of APEC economies

500USA

SolarPRC
2005

1002010

JPN2020

Other APEC
2035

Solar installations lead byChina, Japan and US

TWh

80
60

Strongly supported bypolicy incentives

40
200
PRC

Source: APERC Analysis

JPN

USA

OtherAPEC9APEC NRE Outlook in the Power Sector
by Technology
TWh

Wind
600
500
400
300
200
1000

2005

2010

60

2035

2005

USA

2010

Other APEC

2020

2035

Geothermal gains
traction from attractive
economics

50TWhRapid wind energy
growth in China and UScontinues
Wind energy movesmainstream in many
APEC economies

PRCGeothermal

2020

4030

Conventional resource
potential is limited

20100USA
Source: APERC Analysis

INAMEXOtherAPEC10

Moderate Growth in Biofuels
Biofuel Consumption (Mtoe)

Other APEC

United States

China

6050

Biofuels for transport
constrained by current
biomass resource2nd generation (forestbased) resources in APEC are
immense but the technology
is expensive

4030
20
1002000

2010

2020

2035

Limited production ofcellulosic biofuel expectedfrom USA post 2020

Source: APERC Analysis

11Putting to Rest Lifecycle Emissions
Concerns of Renewable Generation

Clear difference in lifecycle
CO2 emissions between
fossils and renewables
Lifecycle emissions fromnatural Gas are 5x higher
than PV Solar

gC02/kWhEmission from PV solar
has declined with advances
in manufacturing

1200
1000
800
600
400
2000

Source: Adapted from WNA (2010) and (IPCC, 2011 p.732)

12

But Coal is still Increasing in the APECPower Sector
9000

8252

Power Generating (TWh)

8000
6968

7000
6000

6111

Coal5234

Oil

5000

Gas

4000
3000

3518
2414

2000
1000

2354

1686
329

1634

302

Source: APERC Analysis

2825
2302

2424

Hydro
NRENuclear

1328
191

99020093218

20202035
13

APEC Emissions Intensity Goal looks
Plausible
Primary Energy Intensity Index

Final Energy Intensity Index

Index (2005 = 100)

240
200
160
12080

Primary Energy Intensity
45% reduction goal
Final Energy Intensity 45% reduction goal

4002005
Source: APERC Analysis

2010

2015

2020

2025

2030

2035
14

APEC CO2 Emissions Still Increasing
Electricity Generation
Other

Other Transformation
Domestic Transport

IndustryInternational Transport

Million Tonnes CO230000
25000
20000
15000
10000
500001990 1995 2000 2005 2010 2015 2020 2025 2030 2035
Source: APERC Analysis

15Thank you for your attention
http://www.ieej.or.jp/aperc

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