OME: Maghrenov kickoff Barcelona - Day 1
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OVERVIEW AND PERSPECTIVES OF RENEWABLE ENERGY AND ENERGY EFFICIENCY IN THE MEDITERRANEAN REGION
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OME: Maghrenov kickoff Barcelona - Day 1
- 1. OVERVIEW AND PERSPECTIVES OF RENEWABLE ENERGY AND ENERGY EFFICIENCY IN THE MEDITERRANEAN REGION Dr. Houda Ben Jannet Allal Barcelona, 16 December 2013
- 2. OVERVIEW
- 3. MEDITERRANEAN REGION: IMPORTANT CROSSROADS FOR GLOBAL ENERGY MARKETS 7% of world population, 500 million people, 90 million more people by 2030, nearly all in the South 10% world GDP, $7.5 trillion of GDP, 2.5% p.a. average growth to 2030 8% of world’s primary energy demand Transit corridor for global energy markets Heavily impacted by current financial crisis and important socio-political changes High (untapped) for energy efficiency and renewable energy A Region particularly sensible to the impact of climate change 3
- 4. ENERGY DEMAND OVERVIEW Mtoe 1 500 1 400 1 300 MEDITERRANEAN ENERGY DEMAND OUTLOOK, GDP (billion dollars by Scenarios (ppps 2005)) Proactive Scenario Conservative Scenario GDP 12 500 10 500 1 200 1 100 8 500 1 000 900 6 500 800 700 1990 4 500 2000 2010 2020 2030 40% increase in overall demand by 2030. Only 20% increase if robust policies and measures are put in place. 4
- 5. MEDITERRANEAN ENERGY CONSUMPTION PER CAPITA kgoe/capita 3 000 North South 2 000 1 000 0 1990 2000 2010 2020 2030 Today per-capita energy consumption in the South Mediterranean countries is nearly three times less than the level of that in the countries in the North. By 2030 the North will still be consuming twice as much as the South on a per capita basis. 5
- 6. ENERGY DEMAND BY FUEL Mtoe 1400 Renewables & Waste 1200 Hydro 1000 Nuclear 800 Gas 600 400 Oil 200 Coal 0 1990 2009 CS 2030 PS 2030 The future will remain fossil fuel based (70%) and RES will take a significant share (up to 16%) under the PS 6
- 7. HEAVY RELIANCE ON FOSSIL FUELS WILL ENDURE Mtoe MEDITERRANEAN FOSSIL FUEL DEMAND AND PRODUCTION OUTLOOK 1200 2009 Conservative Scenario 2030 Proactive Scenario 2030 1000 800 600 400 Gas 200 Oil Coal 0 Demand Pr oduction Demand Pr oduction Demand Pr oduction To 2030 the Mediterranean region will remain a net importer of fossil fuels regardless of the Scenario. Gas production could nearly double and demand increase between 40% and 70% from 2010 to 2030 7
- 8. GAS ERA AND OIL PEAK bcm 110 100 90 80 70 60 50 40 30 20 10 0 -10 GAS EXPORT POTENTIAL 2010 Algeria Egypt CS 2030 Libya PS 2030 Israel Export capacity would substantially increase under the Proactive Scenario to over 180 bcm in 2030. 8
- 9. ELECTRICITY
- 10. MEDITERRANEAN ELECTRICITY BOOM AHEAD TWh MEDITERRANEAN ELECTRICITYGENERATION 3000 South 2000 46% 42% Nor th 30% 1000 16% 54% 58% Conser vative 2030 Proactive 2030 70% 84% 0 1990 2009 Electricity demand in the South will nearly triple by 2030. 14% could be saved under the alternative scenario. 10
- 11. INSTALLED GENERATION CAPACITY GW 1 000 900 800 700 496 GW Non-hydro Renewables Hydro Nuclear Gas Oil Coal 600 500 878 GW 812 GW 27% 37% 15% 400 10% 18% 300 14% 200 33% 100 12% 13% 4% 9% 2009 2030 CS 10% 16% 10% 35% 28% 3% 6% 2030 PS Over 380 GW will need to be added to meet electricity demand. Less than 320 GW in a Proactive Scenario. RES represent 42% of installed capacity in the CS; 53% in the PS 11
- 12. POWER GENERATION INVESTMENTS billion Euros 400 Renewables Nuclear Fossil Fuels 300 200 100 0 CS PS North Med CS PS South Med Over 700 billion Euros will be needed to 2030. Spared gas could compensate the additional cost of clean generation technologies. 12
- 13. RENEWABLES
- 14. RENEWABLES IN THE MEDITERRANEAN Share of the Mediterranean in global renewable energy demand 3500 3000 Mtoe 2500 2000 1500 1000 500 0 2009 CS 2030 PS 2030 World* 1609 2745 2745 MED 78.9 156 200 *World figures come from IEA New Policies Scenario Renewables in the Mediterranean accounts for 5% of global total renewable energy demand. Renewables in the MED to account for 7.3% of RE energy demand by 2030 in the Conservative and 15% in the Proactive Scenario. 14
- 15. A SUNNY AND WINDY FUTURE Mtoe MEDITERRANEAN ENERGY DEMAND BY FUEL 1 400 Wind 1 300 Solar Geother mal 1 200 Hydro 1 100 Biomass and waste Non Renewables 1 000 900 2010 Conser vative 2030 Proactive 2030 Renewables to supply 10% of primary energy demand by 2030 in the Conservative and 15% in the Proactive Scenario. Most of the increase is expected to come from wind and solar. Renewables will account for 42% of total installed generation capacity in the Conservative and 53% in the Proactive Scenario. 15
- 16. RENEWABLE ELECTRICITY GENERATION 2010 3 500 Hydro 14% RES 6% Coal 14% 3 000 2 500 Nuclear 25% 36% Oil 8% Renewables Gas 33% TWh Hydro 2 000 Nuclear 1 500 Gas 1 000 Oil 500 0 1990 Coal 2000 2010 2020 2030 RES electricity increased by more than 2.5 times in 1990-2010 Renewables are expected to compete directly with natural gas as the dominant electricity source by 2030 (over 1000 TWh), under the PS 16
- 17. THE MEDITERRANEAN SOLAR PLANS
- 18. RE TARGETS IN SOUTH MEDITERRANEAN COUNTRIES 18 Source: OME, MEP 2011
- 20. CONSENSUS ON EE & RE IMPORTANCE EIB / OME / UfM Conference on energy efficiency, 10 December 2013, Brussels All stakeholders, one voice Institutional and regulatory frameworks, subsidies, electricity tariffs, exchange of best practices, innovation … Ministerial meeting, 11 December 2013, Brussels Importance of EE and RE, but not only UfM energy community 20
- 21. ELECTRICITY TARIFFS IN THE MEDITERRANEAN Residential electricity tariffs in the Mediterranean 2012 USD/kWh 0.40 Min Max 0.37 0.35 0.30 0.28 0.27 0.25 0.25 0.23 0.19 0.20 0.16 0.15 0.16 0.12 0.16 0.11 0.11 0.09 0.08 0.05 0.09 0.06 0.02 0.05 0.02 Libya 0.05 Lebanon 0.05 0.13 0.13 0.10 0.15 0.01 Spain Italy EU Turkey Tunisia Syria Morocco Jordan Israel Palestine * average selling Egypt Algeria* 0.00 21
- 22. SUBSIDIES TO FOSSIL FUELS Source: IEA, WEO 2013 22
- 23. CONCLUSION
- 24. KEY MESSAGES (1) Current energy trends in the Mediterranean are not sustainable. Business as usual is not an option: Overall energy demand could grow by 40% by 2030, where fossil fuels will continue to dominate the energy mix and natural gas will overtake oil. Electricity boom ahead: average annual growth rate of about 2.8% and 5% in the South: overall over 380 GW of additional capacity needed. The energy challenge is in the South: Population will grow by over 80 million people; Overall energy demand and CO2 emissions would double; Electricity demand would nearly triple; 200 GW of generation capacity to be installed; 24
- 25. KEY MESSAGES (2) Under the Proactive Scenario, based on improving efficiency and exploiting renewable energy potential: 10% savings in final energy by 2030 Reducing by nearly half the expected fossil fuel import requirements by 2030 Electricity demand could be met with less generation capacity and a higher share of renewable sources Electricity, through renewable technology and grid developments, emerges as the strong driver for reinforcing regional cooperation But also energy efficiency which is nowadays confirmed by all stakeholders as a MUST 25
- 26. KEY MESSAGES (3) Substantial potential for EE & RES in the region, driven by decreasing costs of technologies and very favorable climate conditions Strong electricity demand growth=>role for RES-e Evolving energy efficiency and renewable energy policy support frameworks in some countries Initiatives to improve bankability … BUT… obstacles to be removed: Subsidies to fossil fuels/low energy prices Very diversified institutional frameworks Need for interconnections Stronger S-S and S-N cooperation needed Innovation, R&D, capacity building and best practices share …. 26
Editor's Notes
- Under a Business as Usual Scenario, Conservative as we call it, overall energy demand may growth by 40% over the coming 20 years. There is an alternative path, an objective scenario that we call Proactive, that will translate into only 20% increase in primary energy demand. This means that 12% of primary energy and 10% of final energy could be saved in the year 2030. This save is equivalent to the final energy consumption of the whole Region in 2030.In line with the estimated population and economic growth, 75% of the total increase of energy demand will come from the South. Today per capita energy consumption in the South is one third of per capita consumption in the North but this difference will be reduce in 2030 to 60%.
- Whatever the scenario is, the energy mix will be dominated by fossil fuels in 2030, nearly 80% of all.Whatever the scenario is, gas share will keep on increasing and will overtake oil as the dominant energy source over the next decade. Oil is expected, however, to maintain its stronghold on the transport market.Under a Proactive scenario the Region could reduce by 30% its imports of hydrocarbons and multiply by 2 their export capacities.It is worth to highlight than in the Proactive scenario, renewable energy sources could represent 16% of the total primary energy mix.Regarding energy markets, transport and residential will increase their share, while industry is expected to loose ground.The electricity market will be the largest user of natural gas: over 50% of all gas consumption will be dedicated to power generation.
- Despite a positive outlook for oil and gas production over the next 20 years, the Region will still need to import coal, oil and gas under both scenarios.Total oil production in the Mediterranean remains above 6 mb/d in 2030.Libya will continue to increase levels of oil production to 2030, but will struggle to offset the decline in the other countries.Contrary to oil, the demand of which is less elastic, gas demand will much change according to the scenarios: in a scenario of high energy efficiency and deployment of renewable energy sources, demand will increase by 40% while, in a conservative scenario demand could increase by 70%, nearly as much as gas production increases (from 200 bcm in 2010 to 360 bcm in 2030).Demand in the South Mediterranean is expected to increase more rapidly than the North, due also to attractive prices and easy availability
- Three countries - Libya, Algeria, and Egypt – hold over 93% of the Mediterranean’s oil and gas reserves.Israel will join the exporters club in the South with a modest contribution.Except for Libya, other South Med countries will be hard-pressed to fulfill their export plans while coping with their fast growing internal demand. This pressure will be particularly hard in the case of Egypt: under a business as usual scenario Egypt could hardly maintain their gas export commitments.Total natural gas exports from these countries could increase from 80 bcm in 2010 to 135-185 bcm in 2030 if the adequate policies for investments and energy saving are implemented.
- Coping with electricity demand is one of the major challenges over the two coming decades.Demand will grow at an average growth rate of 2, 8% per year, more rapidly than overall energy demand. In South Mediterranean, however, demand will rise at an average rate of 5% per year and will nearly multiply by three over the considered time period.If at present the North represents 70% of all the electricity demand, the situation will be more balanced by 2030.Under a Proactive scenario, overall electricity demand would be 14% lower. The potential for electricity savings in the next 20 years is of about 3800 TWh, which is all the electricity produced in the South Mediterranean countries for the last ten years
- We estimate that 380 additional GW of installed capacity will be needed to cope with electricity demand at the end of the overview period. More than half of this capacity, around 200 GW, in the South.Under a Proactive scenario, more than 60 GW of generation capacity could be avoided.In both scenarios renewable sources will represent important shares of the new capacities: 42% in a conservative scenario and 53% in a Proactive scenario.
- The investment required to build up the generation capacities mentioned before will be of 715 billion Euros in one case or 700 billion Euros in the Proactive case.Contrary to the estimation in the North, where the investment required in a Proactive scenario would be lower than in the Conservative scenario, in the South the Proactive option will require an additional investment of around 30 billion Euros. The reason is less gas fired plants and more renewable sources and nuclear.We estimate that the economies of spared gas in power generation and higher gas revenues for exporting countries will compensate for the additional costs of cleaner generation technologies.