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Future Energy Scenarios

Gary Dolphin - Energy Forecasting SpecialistElectricity Operational Forum – October 2012

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UK Future Energy Scenarios

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BackgroundThe Climate Change Act 200834% reduction in greenhouse gas emissions by 2020, and 80% reduction by 2050

2009 Renewable Energy Directive15% of all energy from renewable sources by 2020

Government PolicyEMR, RHI, Green Deal, ECO, FiTs, CERT, CRC

Economic BackgroundDemographics, GDP, manufacturing output, fuel prices

HeatHeat pumps, energy efficiency improvements

Electricity EfficiencyLighting, appliances, smart meters

TransportElectric vehicles, alternative fuels

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An uncertain energy future

? ?Now ?2020 2030 2040 2050

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An uncertain energy future

Now

Accelerated Growth

Gone Green

Slow Progression

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Now 2030 2040 2050

Demand & network capacity

Technology uncertainty

Consumer energy behaviour

Gone Green

Generation

2020

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Our scenariosSlow Progression

Government climate targets missed / abandonedContinued economic hardship, low GDP growthLimited energy efficiency / Green Deal impactDomestic gas demand broadly flat, higher in power generation

Overview Main changes vs 2011Electricity demand

Nuclear generation

Renewable generation

Interconnection

Thermal generation

Heat pump deployment

Electric vehicle deployment

Targets performance

2020

2030 carbon

2050 carbon

renewable

carbon

2020 targets

2011 scenario outcome 2012 scenario outcome

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Our scenariosGone Green

Government climate targets met, balanced approachModest GDP growth in medium term at historic averagesEnergy efficiency is driven / Green Deal is effectiveGradual decline in gas demand

Overview Main changes vs 2011Electricity demand

Nuclear generation

Renewable generation

Interconnection

Thermal generation

Heat pump deployment

Electric vehicle deployment

=Targets performance

2020

2030 carbon

2050 carbon

renewable

carbon

2020 targets

2011 scenario outcome 2012 scenario outcome

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Our scenariosAccelerated Growth

Government climate targets met earlySustained economic growth in medium to long termSignificant energy efficiencySignificant reduction in gas demand

Overview Main changes vs 2011Electricity demand

Nuclear generation

Renewable generation

Interconnection

Thermal generation

Heat pump deployment

Electric vehicle deployment

==

Targets performance

2020

2030 carbon

2050 carbon

renewable

carbon

2020 targets

2011 scenario outcome 2012 scenario outcome

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Transport

Electric vehicles (million)

Modest EV growthMore hybrids in early years, more pure EVs in later years

Slow Progression

0

1

2

3

4

5

6

7

8

2010

2012

2014

2016

2018

2020

2022

2024

2026

2028

2030

GG: 3.2m

AG: 7.1m

SP: 0.7m

Strong EV growthMore hybrids in early years, more pure EVs in later years

Gone Green

Robust EV growthMore hybrids in early years, more pure EVs in later years

Accelerated Growth

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Heat

Residential heat pumps (million)

Modest heat pump growthLimited insulation uptake

Slow Progression

GG: 8.8m

0

2

4

6

8

10

12

14

2010

2012

2014

2016

2018

2020

2022

2024

2026

2028

2030

AG: 12.8m

SP: 0.7m

Strong heat pump growthStrong insulation uptake

Gone Green

Robust heat pump growthHigh insulation uptake

Accelerated Growth

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Electricity demand

Annual electricity demand (TWh)

Annual demand broadly flatPeak demand flat / falling

Slow Progression

250

275

300

325

350

375

400

425

2005

2007

2009

2011

2013

2015

2017

2019

2021

2023

2025

2027

2029

Economic growth, heat & transport electrificationPeak demand grows steadily

Gone Green

Reflects greater economic growth and electrification of heat & transport

Accelerated Growth

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Electricity generation

050

100150200250300350400450

2010

2012

2014

2016

2018

2020

2022

2024

2026

2028

2030

Nuclear CCS Coal CCS Gas

Wind Marine / Solar PV Hydro / Pumped Storage

Biomass Imports Gas / CHP

Coal Oil / Other Carbon Intensity g CO2/kWh

Power generation (TWh) &carbon intensity (gC02/kWh)Gone Green:

Extension of existing plant; new gas generationSlower low CO2 deployment

Slow Progression

Balanced approachContributions from different technologies

Gone Green

Faster low CO2 deploymentStrong micro generation deployment

Accelerated Growth

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Slow |ProgressionSlow Progression - generation capacity

0

20

40

60

80

100

120

140

160

180

200

2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030

GW

(Ins

talle

d C

apac

ity)

Nuclear CoalGas / CHP Offshore WindOnshore Wind Other Renew able (Marine/Hydro/Biomass/Solar PV)Interconnector Other (Oil/Pumped Storage)Transmission Demand (Peak Day)

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Gone Green – generation capacity

0

20

40

60

80

100

120

140

160

180

200

2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030

GW

(Ins

talle

d C

apac

ity)

Nuclear CoalGas / CHP Offshore WindOnshore Wind Other Renew able (Marine/Hydro/Biomass/Solar PV)Interconnector Other (Oil/Pumped Storage)Transmission Demand (Peak Day)

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Accelerated Growth – generation capacity

0

20

40

60

80

100

120

140

160

180

200

2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030

GW

(Ins

talle

d C

apac

ity)

Nuclear CoalGas / CHP Offshore WindOnshore Wind Other Renew able (Marine/Hydro/Biomass/Solar PV)Interconnector Other (Oil/Pumped Storage)Transmission Demand (Peak Day)

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The future: efficiency, decarbonisationand electrification

new homes & retrofit

Heat pump

Decarbonised electricity…and decarbonisetransport

TransportElectricity Heat

Efficiency and innovationInsulate and reduceSmart Meters &

Appliance efficiency

De-carbonise heat

Biomethane

CNG

Gas backup& embeddedgeneration

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Q&Agary.dolphin@nationalgrid.com