FINANCIAL INSTITUTIONSENERGYINFRASTRUCTURE, MINING AND COMMODITIESTRANSPORTTECHNOLOGY AND INNOVATIONPHARMACEUTICALS AND LIFE SCIENCES

Nationaal EnergieforumWeero KosterNorton Rose LLPPartner28 November 2012

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Nederlands energieforum

•Opmerkingen ten aanzien van de sprekers en verdienmodellen;•Energieparagraaf in het Regeerakkoord•Windenergie op zee.

FINANCIAL INSTITUTIONSENERGYINFRASTRUCTURE, MINING AND COMMODITIESTRANSPORTTECHNOLOGY AND INNOVATIONPHARMACEUTICALS AND LIFE SCIENCES

Adjiedj Bakas

•Anders denken; thought leadership;•Niet naar de overheid kijken; voor revoluties zijn geen wetswijzigingen nodig;•Kijk naar aerospace en IT; veel komt uit het leger …. accu's voor elektrische auto's en kasplantjes •De klimaatgekte voorbij; Klimaatverandering is niets nieuws ? krantenbericht uit 1922. “Climate weirdness”; klimaat redt zich wel ?;

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Van der Hagen/ Alma Zeestraten/ Presentaties verdienmodellen

•Overheidsbeleid moet consistent op gebied duurzaamheid; door prikkels te stellen; geen subsidies; markt moet het doen;•Bijna allemaal gebaseerd op regelgeving; bevinden zich in gereguleerde sector, zijn overheidsbedrijf en/of ontvangen subsidie;•Chemie en bio-technologie zeer belangrijk;•Alstom wijst op kosten, financieringsvraagstuk en negatieve ‘spark spread’ gas;•Schiphol enthousiast verhaal; •Amsterdam: ‘piecemeal engineering’ stel net open voor kleine projecten.

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Nederlandse Offshore wind

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Weero Koster, Nationaal Energie Forum 28 november 20128

Government Accord

Main energy features of the Accord: A 16% renewable target by 2020 – 100 % by 2050; Optimal use of the SDE+; The possibility of a ‘feed-in tariff’ an co-firing with biomass; But: assessment of progress in 2016; Further ‘green deals’ on energy savings; Tax incentives for small scale PV by end-users and

cooperatives; Promotion of innovation in the Dutch offshore wind

sector together with energy companies and industry;.

Weero Koster, Nationaal Energie Forum 28 november 20129

Government Accord

Main energy features of the Accord: Investigation of a ‘power grid-at-sea’; Initiatives on the infrastructure required for electric

transportation; Initiatives on the use and labeling of biomass; ‘Cradle-to-cradle-initiatives’; Compensation to the agricultural sector; International co-operation on renewables and security of

supply; and Proposals on streamlining of political decision-making and a

substantially increased budget for the SDE+ subsidy scheme (by 2.4 billion €).

Weero Koster, Nationaal Energie Forum 28 november 201210

Government Accord

Some observations on the energy features of the Accord: What is missing ? Where is the money ? Ambition and ambiguity:

current growth rate about 4 %, will grow to 8 or 9 % in ‘business as usual scenario’, not 16 %; currently: of 3000 MW permitted, 228 is up-and-running, 700 under

development: we need 6 times as much in 8 years; development may take 5 yrs so decisions have to be made in 2013/14;

Political di- (or ad-)versity: Liberals: no ‘subsidy dependency’, change permitting system, bundle grids,

‘go-for-what-you-know’ and look elsewhere, nuclear is carbon neutral and 16 is a ‘streven’;

Labour: ‘sweet sixteen’, invest in jobs in a strong growth sector, address costs and grid-issues, create green bank and government-backed loans.

Weero Koster, Nationaal Energie Forum 28 novembe 201211

Norton Rose Round Table Offshore Wind November 2012 16 % must be achieved roughly through 1/3 biomass, 1/3

onshore wind and 1/3 offshore wind; CAPEX on MW basis have doubled and permitting process

gets longer; OPEX are reducing.

Seven observations and recommendations: The Dutch rationale for renewables in the Netherlands has

changed from saving the world from global warming and climate change, to protecting the Dutch economy in crisis;

The Governmental Accord improves the position of Dutch offshore wind power generation, but there are large differences in the interpretation of the Accord by the coalition partners: the liberal view stresses cost reductions and the offshore wind business-case, whilst labour advocates investment in job creation and economic growth;

Weero Koster, Nationaal Energie Forum 28 november 201212

Main Conclusions/Suggestions

Seven observations and recommendations: Lessons to be learned from neighbouring countries are: – to keep the legal framework stable and reduce, to the

extent possible, legal/ country risk; – that a ‘feed-in tariff’ may not be the best solution for all

situations;– to focus on the organisation of permitting zones to facilitate

cooperation by developers; – to increase the focus on the stability of the supply chain;– to be aware of the limited capacity to, and consequences

of, attempting to pass any and all risks on to the contractor and of the costs attached that approach; and– to institute a ‘green bank’ (compare: UK GIB opened 28

November 2012).

Weero Koster, Nationaal Energie Forum 28 november 201213

Main Conclusions/Suggestions

Seven observations and recommendations: The Dutch legislature is willing to facilitate:–by improving the permit system from a technically- to a

functionally driven system, –by creating more ‘bundeling’ in the offshore grid; –by international cooperation with neighbouring countries; and –by innovation in financing such as government backed loans

by public financing companies. Offshore wind power generation costs have to reduce through

reduction of, particularly, OPEX while increasing the lifecycle of electric output, but still there will be a shortage of capital; this may be addressed by innovative financing structures that allow insurance companies, pension funds or bond markets to provide funding after construction;

Weero Koster, Nationaal Energie Forum 28 november 201214

Main Conclusions/Suggestions

Seven observations and recommendations: Further cost reductions and risk mitigations can be achieved

through:–acceleration of the permitting process; – the sharing of research data; – institution of a ‘socket-at-sea; – integrated design requirements of foundation and tower;

and –sharing of technical information;

Weero Koster, Nationaal Energie Forum 28 november 201215

Main Conclusions/Suggestions

Seven observations and recommendations: Further improvements can be made through:–public-private-partnerships in which the Government plays

a role in the preparation phase, preparing locations and granting permits and providing knowledge and private enterprise is left to develop the projects; and– international cooperation and focussing on the comparative

advantage of EU Member States by optimizing the Dutch gas investments in expertise and infrastructure in combination with the renewable investments made elsewhere in Europe.