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© OECD/IEA 2016 © OECD/IEA 2015 IEA review of France’s energy policies in the global context Paul Simons IEA Deputy Executive Director Paris, 17 January 2017
© OECD/IEA 2016 © OECD/IEA 2015
IEA review of France’s energy policies in the global context
Paul Simons
IEA Deputy Executive Director Paris, 17 January 2017
© OECD/IEA 2016
Paris Agreement gives momentum to the low-carbon energy transition
• Led by renewables and energy efficiency
• Record renewables additions in 2015, especially solar & wind
• Energy efficiency investment reached $221 bn in 2015
• Local air pollution, energy access and energy security as additional drivers of the energy transition
Low fossil fuel prices can affect the energy transition in different ways
• Risk of derailing competitiveness of low-carbon alternatives
• Looming oil price volatility can boost low-carbon policy efforts
Global context
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Change in total primary energy demand
Low-carbon fuels & technologies, mostly renewables, supply nearly half of the increase in energy demand to 2040
Low- carbon
Oil Gas Coal
The global energy transition
500
1 000
1 500
2 000 1990-2015 2015-2040
Mto
e
Low- carbon
Oil Gas Coal
Nuclear
Nuclear
Ren
ewab
les
Ren
ewab
les
Rest of world
European Union Latin
America
India
US
Africa
China
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Current pledges fall short of limiting the temperature increase to below 2 °C; raising ambition to 1.5 °C is uncharted territory and requires technology innovation
Energy-sector CO2 emissions
But still a long way from a pathway to energy sector decarbonisation
10
20
30
40
1990 2000 2010 2020 2030 2040
Gt
2060 2080 2100 2050 2070 2090
Early peak in emissions
Net-zero by the end of the century
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IEA countries see a full decoupling of growth, demand and emissions
IEA members have fully decoupled demand from economic growth.
Non-OECD will account for more than 80% of electricity demand growth up to 2040.
90
100
110
120
130
140
150
160
170
1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014
Ind
ex (
19
90
=10
0)
GDP (USD 2010prices and PPPs)
Population
TFC
CO2 emissionsfrom fuelcombustion
Decoupling
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Renewable cost reductions to remain an important driver for future growth
Utility-scale solar PV generation cost to fall by another quarter and onshore wind by 15% over 2015-21, largest absolute cost reduction expected from offshore wind
Weighted average generation costs for solar PV and wind
0
50
100
150
200
250
300
350
400
2011 2016 2021
USD
2015
/MWh
Onshore wind Offshore wind Solar PV - utility scale
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Energy intensity is improving but not fast enough
Global annual energy intensity gains
In 2015, global intensity improved by three times the average of the last decade, despite low fuel prices. Intensity gains need to increase to 2.6% to achieve our climate goals.
-3%
-2%
-1%
0%
2003-13 2013-14 2014-15 2016-30(2 degree goal)
Source: IEA, Energy Efficiency Market Report 2016
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Investment needs under different scenarios
Cumulative world energy sector investment by sector & scenario, 2015-2040
A 2 °C pathway requires changing the investment balance across fuels & sectors, and across supply & demand, rather than the scale of the global energy investment
5
10
15
20
25
30
35
NPS 450
Trill
ion
do
llars
(2
01
4)
Fuel supply Power supply End-use efficiency NPS 450 NPS 450
Biofuels Coal Natural gas Oil
T&D Renewables Nuclear Fossil fuels
Buildings Transport Industry
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From the global context to the energy policy of France
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Progress in many sectors • International leadership in climate change and green finance (COP21) with
Paris Agreement
• Legal framework and governance: Energy Transition for Green Growth Act with ambitious targets for energy efficiency, renewables, reduction of nuclear
• Market opening: end of regulated tariffs for large consumers, new interconnections and demand-side response
Challenges ahead • Future of the French nuclear fleet and low carbon mix with VRE
• Financing the energy transition
• Electricity security
• Catching up on renewable energy and energy saving goals for 2020
• Local air quality in the cities
• End of regulated tariffs for all
France’s energy transition
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GDP growth decoupled from energy demand & CO2 emissions
Since 2008, energy supply, consumption and energy-related CO2 emissions have been falling fast, except in the transport sector
Emissions: Low-hanging fruits are gone…
80
90
100
110
120
130
140
150
1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014
Index (199
0 =
100
)
Real GDP
TPES
CO₂ emissions
Population
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Decomposition of EE progress
Energy efficiency progressed
80
85
90
95
100
105
110
115
120
125
130
1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014
Index (1990 =
100)
Acticity
Actual
Energy
Structure
Efficiency
Decline in energy consumption is mainly the result of greater energy efficiency, notably in the residential sector but renovation requires attention
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Share of RES in the electricity mix still below IEA average
Introduction of single permit, feed-in premium/auctions, and broader tax base are welcome reforms and will support solar and onshore wind development
Renewable energy lags behind
0%
20%
40%
60%
80%
100%
Biofuels and waste Solar Geothermal Wind Hydro
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Low carbon mobility on the rise
0
200
400
600
800
1 000
1 200
1 400
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Thou
sand
cars
Others*
Germany
United Kingdom
France
Norway
Netherlands
Japan
China
United States
Transport sector
France is among Europe’s leaders in the deployment of Evs, also thanks to bonus-malus, tax incentives and narrowing diesel-gasoline tax differential.
Source: IEA (2016), Global EV Outlook 2016, OECD/IEA, Paris.
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Role of nuclear energy
France has a low-carbon energy mix, thanks to the 78% share of nuclear energy. However, the nuclear fleet is ageing and the market highly concentrated.
Electricity sector
0
100
200
300
400
500
600
1973 1976 1979 1982 1985 1988 1991 1994 1997 2000 2003 2006 2009 2012 2015
TWh
Nuclear
Hydro
Natural gas
Coal
Wind
Oil*
Biofuels and waste
Solar
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Electricity security
Peak winter demand
France has experienced low demand response and low nuclear availability. Imports play an important role to cover weather-induced peak demand.
0
10
20
30
40
50
60
70
80
90
100
110
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
GW
© OECD/IEA 2015
Key recommendations to France
Accelerated transition: Ensure long-term visibility of financing and adopt progress reviews and roadmaps based on robust scenarios.
Rules for clean energy investment: Boost energy efficiency and renewable energy based on the PPE and national action plans.
The future of nuclear: When implementing the 50% nuclear target, guarantee continuous security of electricity supply and maintain the low carbon footprint. Take into account supply/demand, safety and economic aspects when deciding on LTOs and new builds.
Strong energy markets: Continue work towards market opening, competition, and consumer empowerment in gas and electricity retail markets and consider the phase-out of regulated tariffs.
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