The Big Picture Understanding long-term energy transition drivers

Transcription

1 BMEA The Big Picture Understanding long-term energy transition drivers Gideon Laugs, Bert Kiewiet

2 Background Developments occurring in parallel: Climate change mitigation. Increasing standards of living. Competition for energy resources. Energy poverty and food versus energy. Availability of fossil fuels and alternative energy sources. Challenges: Future outlook for the energy market and position of gas is difficult to foresee. Energy business is highly capital-intensive, with long lead times. This requires the stakeholders to developed visions for the long term. 2

3 Central Research Question What are potential robust energy end states after the transition and what will be the role and share of both renewable energy and in particular natural gas in The Netherlands? Three sub questions: 1. What is the long- term security of demand for natural gas in the different end-states? 2. What is the long-term security of sustainable supply in the different end-states? 3. What are the key success factors in the innovation of technology in order to arrive at a steady end state 3

4 Project Design 4

5 Approach Energy scenario literature Energy transition end states Limitations and consequences analysis of energy transition end states

6 Results Work Stream 0: Three Energy Transition End States 1000 Energy mix cluster 1: "BAU" 1000 Energy mix cluster 2: "Renewables" 1000 Energy mix cluster 3: "Gas" EJ EJ EJ renewables nuclear oil coal gas 6

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8 Drivers: PESTE Classical Definitions Factors Keywords Political Economic Social Technical Environmental Factors are to what degree government intervenes in the economy: Tax policy, labour law, environmental law, trade restrictions, tariffs Factors have impact on how businesses operate and make decisions: Economic growth, interest rates, exchange rates, inflation rate Factors address cultural aspects. Trends in social factors affect the demand for a company s products and how the company operates: Population growth rate, age distribution, safety Factors include technical aspects such as R&D activity: automation, technology incentives, rate of technological change Factors include ecological and environmental aspects: weather, climate (change), awareness of impacts on/of climate change 8

9 Drivers: PESTE Definitions The classical definitions of the PESTE factors are rather broad and contain many qualitative notions. We need to gain insight in the pressure exerted on the global system to reach an end state. Steps taken: - Selection of comparators (PESTE categories) - Data collection (analysis of the scenario narratives) - Data harmonization (data to categories) - Data normalization (ranking the pressure ) - Analysis of results 9

10 Drivers: PESTE Getting Practical Revolution En Serious change Gradual change P T Intra segment Ec Multi segment S All segments 10

11 Drivers: PESTE Getting Practical Tier 1: Been there, done that Scaling up of existing technology large scale solar and wind parks Tier 2: Not impossible, but challanges ahead Combining known concepts P2G, shale gas Tier 3: To boldly go where no man has gone before Technology that fundamentally changes behaviour nuclear fusion T 11

12 Drivers: PESTE Getting Practical Tier 1: Been there, done that Need not easy, can be very costly build pipeline, build factory Tier 2: Not impossible, but challanges ahead increased world wide equity, fair trade, hydrogen economy Ec Tier 3: To boldly go where no man has gone before completely other business model, abundance of wealth. 12

13 PESTE Analysis per End State 1000 Energy mix cluster 1: "BAU" Energy mix cluster 1: "BAU" 1000 Energy mix cluster 2: "Renewables" Energy mix cluster 1: "BAU" 1000 Energy mix cluster 1: "Gas" Energy mix cluster 1: "BAU" EJ EJ EJ renewables nuclear oil coal gas 13

14 Observations End State: Business as Usual Characteristics 8.5 Billion people using 40% more energy than in 2010, annual 2.5% GDP growth, CO 2 up to 50 euro/ton Steady increase in coal, oil, gas & energy efficiency Big winners : Renewables (+ 300%) and nuclear (+500%) No losers Key characteristics PESTE pressure: Energy prices similar to 2010 Somewhat more electric mobility Lots of wind turbines, solar PV, biomass plants everywhere Saving the planet still on to do list Energy mix cluster 1: "BAU" Energy mix cluster 1: "BAU" Some more oil spills, occasional Fukushima. the future looks remarkably like 2013 EJ gas coal oil nuclear renewables

15 Observations End State: Renewables Characteristics 8.5 Billion people using only 10% more energy than in 2010, annual 2.5% GDP growth, CO2 up to 120 euro/ton Big winners : energy efficiency & renewables (+500%). Big losers : oil & natural gas Coal + CCS escape fate oil & gas Key characteristics PESTE pressure Electric & hydrogen mobility only ( no more petrol ) Smart grids, solar PV & fuel cells ( power to the people ) Lots of wind mills, solar PV, biomass plants everywhere Different way of life, redesign urban & rural areas Energy mix cluster 2: "Renewables" Energy mix cluster 1: "BAU" Energy and energy using appliances will be luxury products(!) EJ enforced oil & gas free paradise gas coal oil nuclear renewables 15

16 Observations End State: Gas Characteristics 8.5 Billion people using only 100% more energy than in annual 2.5% GDP growth. CO2 up to 30 euro/ton Big winners : renewables (+400%), oil & gas. Big loser : energy efficiency Key drivers PESTE pressure Relatively clean energy for everyone (not cheap though!) Lots of wind mills, solar PV, biomass plants everywhere More inexpensive cars & HVACs for everybody Energy mix cluster 1: "Gas" Energy mix cluster 1: "BAU" More oil sheikhs and gas czars Even more oil spills, leaking gas fields, occasional Fukushima. 200 Saving the planet still on to do list everyone can live the American dream EJ gas coal oil nuclear renewables

17 Conclusions Reflection on the results: BAU end state lowest PESTE pressure, followed by Gas then Renewables. BAU & Gas: no real losers. Renewables: oil & gas lose out. All end states have a similar growth of renewables(!) Gas end state implies gas will provide large amounts of clean cost effective coal. Renewables end state implies extreme energy efficiency rather than more solar panels. Many scenarios cover the world, limited number of scenarios cover NW-EU or NL. Reflection on the methodology used: Results seem robust. Scenarios ranked by expert group, independent results match. Improvement: subjective evaluation of PESTE pressure rating. Idea: ranking by more diversified group may improve robustness even further, but not likely to change overall findings. 17

18 Contact Bert Kiewiet Senior Consultant Gas Markets & Policy Energieweg 17, 9743 AN Groningen, The Netherlands T Bert.Kiewiet@dnvkema.com Gideon Laugs PhD student Rijksuniversiteit Groningen Nijenborgh 4, 9747 AG Groningen, The Netherlands T g.a.h.laugs@rug.nl