Outlook for Renewable Energy from an Asian Perspective

Transcription

1 Outlook for Renewable Energy from an Asian Perspective Douglas-Westwood Singapore Jason Waldie, Assoc Director Asia Clean Energy Forum 216 ADB, Manila, 9 June 216

2 Renewable Energy: Global 16, 14, 12, Global Power Generation Supply Mix (TWh) Renewables 25 2 Global Investment on Renewable Capacity ($Billion) Solar 1, 8, 6, Natural Gas Coal 15 1 Onshore Wind 4, 2, Nuclear Oil 5 Solar Other 215 was a peak year to date for investment in renewable energy generation with over $2.3 billion investment globally on new capacity additions - outpacing conventional fossil fuel and nuclear. Over the next twenty years, an anticipated $6.1 billion will be spent at a Compound Annual Growth Rate (CAGR) of 2.8% as the global industry adds an additional 4,2GW of renewable capacity.

3 Onshore wind - LCOE has fallen by 13% over the past 5 years Improved efficiency Increasing turbine size Renewable Energy: Global Reducing Levelized Cost of Electricity (LCOE) for Solar and Onshore Wind (US$/MWh) Solar PV Onshore wind Natural gas Coal Solar PV Onshore wind Natural gas Coal Solar LCOE has fallen by 5% over the past 5 years Improved economies of scale in the manufacturing industry Falling price of polysilicon which is a primary component of solar panels Improved solar panel performance

4 Renewable Energy: Asia Growth of Energy Demand (%) % 59% 55% 53% Asia Global 41% 45% 28% 47% Asia-Pacific Rest of the World Primary Energy Demand by Region Global Vs Asia Investment on Renewable Capacity ($Billion) Principal drivers for increased adoption of renewable energy at a global level are the increasing focus of governments on mitigating security of supply risk associated with fossil fuels

5 Renewable Energy: Asia The Asian market currently accounts for 41% of global energy demand and 45% of global power generation % China 7% 6% 5% 4% 3% 2% India SE Asia 1% % 6% 5% Solar 4% 3% Onshore Wind 2% Hydro Offshore Wind 1% Biomass % Asian Renewable Spend ($Billion) Asian Renewable Spend by Geography Asian Renewable Spend by Sector Renewable sources account for 8% of regional energy consumption with this share expected to increase to 14% by 235

6 Renewable Energy: Asia - Philippines Highly embryonic renewables market, current installed capacity stands at 4.5GW Solar Onshore Wind 1 Other Philippines Investment on Renewable Capacity ($Billion) IPP 1% Current Philippines Generating Capacity Breakout- *Independent Power Producer Geothermal and hydro already feature prominently in the country s energy supply mix. However, significant future investment in solar PV and onshore wind is expected to be announced when the government releases its Philippine Energy Plan (PEP) later this year.

7 Renewable Energy: Asia - Thailand Aims at establishing an Energy-Sufficient Society and promoting Renewables Growth Solar Onshore Wind Other Thailand Investment on Renewable Capacity ($Billion) SPP 12% VSPP 5% IPP 35% Imports 6% EGAT 42% Current Thailand Generating Capacity Breakout * EGAT - State Utility Thailand s most recent Power Development Plan (PDP) calls on an increase in renewable contribution to the nation s power generation mix from 15% to a range between 3% and 4% by 236. Solar PV and wind are expected to account for the majority of incremental renewable capacity. Independent Power Producer (IPP); Small Power Producer (SPP); Very Small Power Producer (VSPP);

8 Policy mechanisms introduced in 29 were highly successful in kickstarting the solar PV and wind industries and the country is now transitioning to a more standard FiT scheme providing potential investors with longer-term stability at the expense of short term profitability 3 Renewable Energy: Asia - India Recent years have increased focus on renewables as part of the future energy supply Solar Other IPP 4% Central 26% 1 5 Onshore Wind State 34% India Investment on Renewable Capacity ($Billion) Current India Generating Capacity Breakout

9 Other Onshore Wind Solar. Renewable Energy: Asia - Indonesia Recent years have increased focus on renewables as part of the future energy supply Power Consumption (TWh) Energy Demand (mtoe) CAGR 3.9% CAGR 2.9% Indonesia Investment on Renewable Capacity ($Billion) Indonesia Energy & Power Demand Projections The majority of renewable investment is expected to come from biomass and hydro with onshore wind and solar PV expected to account for 21% and 23% respectively.

10 Renewable Energy: Asia - Taiwan Taiwanese energy sector is expected to undergo a significant transformation - reduce coal and nuclear power Solar 35 3 Power Consumption (TWh) CAGR 1.1% Onshore Wind Energy Demand (mtoe) CAGR.5%. Taiwan Investment on Renewable Capacity ($Billion) Taiwan Energy & Power Demand Projections Government plans to make Taiwan nuclear free by 225 is expected to see significant investment in new renewable capacity over the next 2 years

11 Renewable Energy: Offshore wind

12 Renewable Energy: Offshore wind

13 Renewable Energy: Onshore/ Offshore Asia Key Risks Regulatory & Policy Risk Potential changes to energy policy and regulation at national levels. Intermittency & Resource Risk Unexpected changes in weather can have a significant impact on outputs and subsequent revenues. Connectivity & Infrastructure In most markets, suppliers must seek a grid connection permit as well as a generation license and may need to submit supply estimates to local regulators Off-Taker Potential for counterparties to renege on PPA obligations due to bankruptcy or other force majeure still presents a threat.

14 Renewable Energy: - Conclusions 215 was a peak year to date for investment in renewable energy generation with over $2,298 billion investment globally on new capacity additions - outpacing conventional fossil fuel and nuclear. Solar LCOE has fallen by 5% over the past 5 years Onshore wind - LCOE has fallen by 13% over the past 5 years The Asian market currently accounts for 41% of global energy demand and 45% of global power generation Renewable sources account for 8% of regional energy consumption with this share expected to increase to 14% by 235 Key risks: Regulatory & Policy; Intermittency & Resource Risk; Connectivity & Infrastructure; Off-Taker Offshore wind: less of a focus in Asia in comparison to Europe but China and Korea are looking like the leaders in years to come

15 Our business: research and consulting offshore onshore downstream 11/3/215 Established 199 London, Aberdeen, Houston, Singapore Activity & Service Lines Business strategy & advisory Commercial due-diligence Market research & analysis Published market studies Large, Diversified Client Base >1,2 projects, >45 clients >72 countries, >23 sectors Clients include the top-1: Oil & Gas Companies Oilfield Services Renewable energy investors and operators Investment Banks Private Equity firms Government Agencies power LNG renewables

16 Thank you See me for a copy of this presentation Jason.Waldie@douglaswestwood.com