© OECD/IEA 2012

Energy Technology Perspectives for a Clean Energy Future

Ms. Maria van der HoevenExecutive DirectorInternational Energy AgencyMadrid, 20 September 2012

Key messages

1. A sustainable energy future is still feasible and technologies exist that can take us there

2. Despite the potential of technologies, progress is too slow at the moment

3. A clean energy future requires systemic thinking and deployment of a variety of technologies

4. It even makes financial sense to do it!5. Government policy is decisive in unlocking the

potential

Energy demand and emissions have doubled in the past 40 years

From 6000 Mtoe to 12 000 Mtoe Rapid demand growth outside OECD

Source: IEA statistics

CO2 emissions from 14Gt to 30Gt Since 2005, non-OECD countries

emit more than OECD

ETP 2012 – Choice of 3 Futures

© OECD/IEA 2012

6DSwhere the world is now heading, with potentially devastating results

The 6°C Scenario

4DSreflecting pledges by countries to cut emissions and boost energy efficiency

The 4°C Scenario

2DSa vision of a sustainable energy system of reduced CO2 and other Greenhouse Gas (GHG) emissions

The 2°C Scenario

© OECD/IEA 2012

ETP-2012: need to halve CO2 by 2050

To achieve ambitious climate goals, the world needs to cut energy-related CO2 emissions by 50% from today’s levels…

…but as populations grow and energy consumption inevitably rises, the reduction challenge is even higher: a gap of 24-42 Gt in 2050

Clean energy: slow lane to fast track

© OECD/IEA 2012

Progress is too slow in almost all technology areas

Significant action is required to get back on track

Energy RD&D has slipped in priority

© OECD/IEA 2012

0%

2%

4%

6%

8%

10%

12%

0

5

10

15

20

25

1974 1978 1982 1986 1990 1994 1998 2002 2006 2010

Shar

e of

ene

rgy

RD&

D in

tota

l R&

D

USD

bill

ion

Energy efficiency Fossil fuels

Renewable energy Nuclear

Hydrogen and fuel cells Other power and storage technologies

Other cross cutting technologies/research Share of energy RD&D in total R&D

0

1

2

3

4

Braz

il

Chin

a

Indi

a

Mex

ico

Russ

ia

Sout

h A

fric

a

USD

bill

ion

2008 non-IEA country spending

© OECD/IEA 2012

A smart, sustainable energy system

© OECD/IEA 2012

A sustainable energy system is a smarter, more unified and integrated energy system

© OECD/IEA 2012

Renewables need to dominate EU electricity

Renewables cover two-thirds of the electricity mix in 2050 in the 2DS, with wind power alone reaching a share of 30% in the mix.

0

500

1 000

1 500

2 000

2 500

3 000

3 500

4 000

4 500

5 000

4DS 2DS

2009 2050

TWh

Other renewables

Wind

Solar

Hydro

Nuclear

Fossil w CCS

Fossil w/o CCS

53%

27%

2%

1%

7%

28%

22%

23%

10%

9%

13%

7%

10%

4%

21%

28%

4%13% 17%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

4DS 2DS

2009 2050

Gen

erati

on s

hare

Other renewables

Wind

Solar

Hydro

Nuclear

Fossil w CCS

Fossil w/o CCS

Other renewables

Wind

Solar

Nuclear

Solar

Hydro

Fossil w/o CCS

Fossil w CCS

2009 2050

© OECD/IEA 2012

Renewables: mid-term forecast for Spain

Drivers: Abundant renewable

resources Strong grid and

advanced integration of variable renewable sources

Challenges: Overcapacity of

electricity system Need to correct for

persistently high tariff deficit

0

20

40

60

80

100

120

2005 2006 2007 2008 2009 2010 2011

Spain power capacity vs peak load (GW)

Nuclear Hydropower

Combustible fuels Solar

Wind Peak load

0

20

40

60

80

100

120

2011 2012 2013 2014 2015 2016 2017

Spain forecast renewable generation

Hydropower Wind onshore Solar PV

Bioenergy CSP Wind offshore

TWh

© OECD/IEA 2012

0

2 500

5 000

7 500

10 000

2009 2020 2030 2040 2050

TWh

4DS

OECD Non-OECD

0

2 500

5 000

7 500

10 000

2009 2020 2030 2040 2050

2DS

Power generation from natural gas increases to 2030 in the 2DS and the 4DS.

From 2030 to 2050, generation differs markedly.

Natural gas-fired power generation must decrease after 2030 to meet the CO2 emissions projected in the 2DS scenario.

2DS4DS

Natural gas as a transitional fuel

© OECD/IEA 2012

Electric vehicles need to come of age

© OECD/IEA 2012

More than 90% of new light duty vehicles need to be propelled by an electric motor in 2050

Glo

bal p

asse

nger

LD

V s

ales

(m

illio

n)

© OECD/IEA 2012

Industry must become more efficient

© OECD/IEA 2012

Significant potential for enhanced energy efficiency can be achieved through best available technologies.

GtC

O2

© OECD/IEA 2012

- 120 - 80 - 40 0 40

10%

Undiscounted

Fuel savings

Additionalinvestment

Tota

l sav

ings

USD trillion

Power

Industry

Transport

Residential

Commercial

Biomass

Coal

Oil

Gas

Fuel savings

Additional investment

Investment in clean energy pays off

© OECD/IEA 2012

Every additional dollar invested in clean energy can generate three dollars in return.

USD trillion

Recommendations to Governments

© OECD/IEA 2012

1. Create an investment climate of confidence in clean energy

2. Unlock the incredible potential of energy efficiency – “the hidden fuel” of the future

3. Accelerate innovation and public research, development and demonstration (RD&D)

© OECD/IEA 2012

www.iea.org/etp

For much more, please visit