Bloomberg New
Energy Finance
Summit
New York
Michael Liebreich
Chairman of the Advisory Board
Twitter: @mliebreich
25 April 2017
Global new clean energy investment
500
Record
investment
400
$349bn
300
$317bn
$315bn
$291bn
$276bn
200
$205bn
$207bn
2008
2009
$287bn
$269bn
Forecast
$175bn
$128bn
100
$88bn
$62bn
0
2004
2005
2006
2007
2010
2011
2012
2013
2014
2015
Note: Total values include estimates for undisclosed deals. Includes corporate and government R&D, and spending for
digital energy and energy storage projects (not reported in quarterly statistics). Excludes large hydro
1
Michael Liebreich
Bloomberg New Energy Finance Summit, 25 April 2017
2016
2017
Source: Bloomberg New Energy Finance
@mliebreich
Unsubsidised clean energy world
records, April 2016
Solar PV
Country:
Bidder:
Signed:
Construction:
Price:
Onshore wind
Coahuila Mexico
Enel Green Power
March 2016
2019
US$ 3.60 c/kWh
Country:
Bidder:
Signed:
Construction:
Price:
Offshore wind
Morocco
Enel Green Power
January 2016
2018
US$ 3.0 c/kWh
Country:
Bidder:
Signed:
Construction:
Price:
Denmark
Vattenfall
Dec 2015
2019
US$ 5.3 c/kWh
Source: Bloomberg New Energy Finance; ImagesSiemens; Wikimedia Commons
2
Michael Liebreich
Bloomberg New Energy Finance Summit, 25 April 2017
@mliebreich
Global carbon emissions from fossil fuels
GtCO2e
40
36
35
34
10.00%
8.00%
6.00%
4.00%
2.00%
0.00%
32
30
30
6%
25
4%
20
5.5% 5.7% 3.1%
5.4% 4.2%
Global GDP
growth
(real)
3.4%
3.4% 3.4%
3.5%
2%
2015
2014
2013
2012
2011
2010
0% 5.4% 4.2% 3.4% 3.4% 3.4% 3.5%
2009
10
2008
5.5% 5.7% 3.1%
2006
0%
2007
15
5
Note: Includes NGL and processing gain, but excludes biofuels
3
Michael Liebreich
Bloomberg New Energy Finance Summit, 25 April 2017
2015
2010
2005
2000
1995
1990
1985
1980
1975
1970
1965
1960
1955
1950
1945
1940
1935
1930
1925
1920
1915
1910
1905
1900
1895
1890
1885
1880
1875
1870
0
Source: IEA; CDIAC; BP; Bloomberg New Energy Finance
@mliebreich
The 2016 election
Image: Skinbase; M Liebreich
4
Michael Liebreich
Bloomberg New Energy Finance Summit, 25 April 2017
@mliebreich
Global new clean energy investment
and capacity installation
180
2016
Installations
160
up 9%
160GW
500
140
400
$349bn
300
88GW
$317bn
$315bn
$291bn
$276bn
200
$205bn
$287bn
$269bn
2016
120
Investment
100
down 17%
Forecast
$207bn
80
60
$175bn
40
$128bn
100 20GW
$88bn
20
$62bn
0
0
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
Note: Total values include estimates for undisclosed deals. Includes corporate and government R&D, and spending
for digital energy and energy storage projects (not reported in quarterly statistics). Excludes large hydro.
5
Michael Liebreich
Bloomberg New Energy Finance Summit, 25 April 2017
2016
2017
Source: Bloomberg New Energy Finance
@mliebreich
Unsubsidised clean energy world
records April 2016
Solar PV
Country:
Bidder:
Signed:
Construction:
Price:
Onshore wind
Coahuila Mexico
Enel Green Power
March 2016
2019
US$ 3.60 c/kWh
Country:
Bidder:
Signed:
Construction:
Price:
Offshore wind
Morocco
Enel Green Power
January 2016
2018
US$ 3.0 c/kWh
Country:
Bidder:
Signed:
Construction:
Price:
Denmark
Vattenfall
Dec 2015
2019
US$ 5.3 c/kWh
Source: Bloomberg New Energy Finance; ImagesSiemens; Wikimedia Commons
6
Michael Liebreich
Bloomberg New Energy Finance Summit, 25 April 2017
@mliebreich
Unsubsidised clean energy world
records since April 2016
Solar PV
Country:
Bidder:
Signed:
Construction:
Price:
Onshore wind
United Arab Emirates
Masdar/DEWA
May 2016
2018
US$ 2.99 c/kWh
Country:
Bidder:
Signed:
Construction:
Price:
Offshore wind
Morocco
Enel Green Power
January 2016
2018
US$ 3.0 c/kWh
Country:
Bidder:
Signed:
Construction:
Price:
Denmark
Vattenfall
Dec 2015
2019
US$ 5.3 c/kWh
Source: Bloomberg New Energy Finance; ImagesSiemens; Wikimedia Commons
7
Michael Liebreich
Bloomberg New Energy Finance Summit, 25 April 2017
@mliebreich
Unsubsidised clean energy world
records since April 2016
Solar PV
Country:
Bidder:
Signed:
Construction:
Price:
Onshore wind
Chile
Solarpack Corporation
August 2016
2019
US$ 2.91 c/kWh
Country:
Bidder:
Signed:
Construction:
Price:
Offshore wind
Morocco
Enel Green Power
January 2016
2018
US$ 3.0 c/kWh
Country:
Bidder:
Signed:
Construction:
Price:
Denmark
Vattenfall
Dec 2015
2019
US$ 5.3 c/kWh
Source: Bloomberg New Energy Finance; ImagesSiemens; Wikimedia Commons
8
Michael Liebreich
Bloomberg New Energy Finance Summit, 25 April 2017
@mliebreich
Unsubsidised clean energy world
records since April 2016
Solar PV
Country:
Bidder:
Signed:
Construction:
Price:
Onshore wind
Mexico
X-Elio
September 2016
2019
US$ 2.74 c/kWh
Country:
Bidder:
Signed:
Construction:
Price:
Offshore wind
Morocco
Enel Green Power
January 2016
2018
US$ 3.0 c/kWh
Country:
Bidder:
Signed:
Construction:
Price:
Denmark
Vattenfall
Dec 2015
2019
US$ 5.3 c/kWh
Source: Bloomberg New Energy Finance; ImagesSiemens; Wikimedia Commons
9
Michael Liebreich
Bloomberg New Energy Finance Summit, 25 April 2017
@mliebreich
Unsubsidised clean energy world
records since April 2016
Solar PV
Country:
Bidder:
Signed:
Construction:
Price:
Onshore wind
Mexico
FRV
September 2016
2019
US$ 2.69 c/kWh
Country:
Bidder:
Signed:
Construction:
Price:
Offshore wind
Morocco
Enel Green Power
January 2016
2018
US$ 3.0 c/kWh
Country:
Bidder:
Signed:
Construction:
Price:
Denmark
Vattenfall
Dec 2015
2019
US$ 5.3 c/kWh
Source: Bloomberg New Energy Finance; ImagesSiemens; Wikimedia Commons
10
Michael Liebreich
Bloomberg New Energy Finance Summit, 25 April 2017
@mliebreich
Unsubsidised clean energy world
records since April 2016
Solar PV
Country:
Bidder:
Signed:
Construction:
Price:
Onshore wind
Mexico
FRV
September 2016
2019
US$ 2.69 c/kWh
Country:
Bidder:
Signed:
Construction:
Price:
Morocco
Enel Green Power
January 2016
2018
US$ 3.0 c/kWh
Note: The offshore wind merchant price is estimated based on project LCOE in real 2016 terms
11
Michael Liebreich
Offshore wind
Country:
Germany
Bidder:
DONG/EnBW
Signed:
April 2017
Construction:
2024
Merchant Price: US$ 4.9 c/kWh
Source: Bloomberg New Energy Finance; ImagesSiemens; Wikimedia Commons
Bloomberg New Energy Finance Summit, 25 April 2017
@mliebreich
Investment in power capacity, by
technology
$ billion/year
300
250
Renewables
excluding large hydro
200
150
Fossil fuels
100
Large hydro
50
Nuclear
0
2008
2009
2010
2011
2012
2013
2014
2015
2016
Source: Bloomberg New Energy Finance, UNEP
12
Michael Liebreich
Bloomberg New Energy Finance Summit, 25 April 2017
@mliebreich
Green bond issuance
Issuance by category ($ billion)
Issuance by geography ($ billion)
150
123.0
125
95.7
100
ABS/MBS
150
Project
125
Corporations
123.0
95.7
100
Financials
75
APAC
75
Municipal
49.6
50
25
Government
agencies
15.4
1.5 0.5 0.9
7.7
Sovereigns
09
25
1.5 0.5 0.9
Supranationals
2007
EMEA
3.4 5.1
0
11
13
15
17E
7.7
15.4
3.4 5.1
0
2007
09
11
13
15
Note: 1Q 2017 issuance was $30 billion. 2017 estimate is based on growth on previous years Source: Bloomberg New Energy Finance, Bloomberg Terminal
13
Michael Liebreich
AMER
49.6
37.8
50
37.8
Supranational
Bloomberg New Energy Finance Summit, 25 April 2017
@mliebreich
17E
Global carbon emissions from fossil fuels
GtCO2e
40
36
35
34
30
32
25
30
6%
Global
5.4 4.2 3.4
3.4 GDP
3.4 3.5
growth (real)
5.5 5.7 3.1
4%
20
2%
2016
2015
2014
2013
2012
2011
2010
-0.1%
2009
2008
-2%
5.5%5.6%3.0% 0% 5.4%4.2%3.5%3.4%3.5%3.4%3.1%
2007
0%
2006
15
10
5
0
1870
1880
1890
1900
1910
1920
1930
1940
1950
1960
1970
1980
1990
2000
2010
Source: IEA; CDIAC; BP; Bloomberg New Energy Finance
14
Michael Liebreich
Bloomberg New Energy Finance Summit, 25 April 2017
@mliebreich
China new investment in clean energy
($ billion)
15
Michael Liebreich
Bloomberg New Energy Finance Summit, 25 April 2017
@mliebreich
China snapshot
China yoy% growth in power demand
Thermal capacity factor and RE curtailment
25%
70%
Average thermal capacity factor
60%
20%
50%
15%
40%
30%
10%
Wind curtailment
20%
5%
10%
Solar curtailment
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
2010
2011
2012
2013
2014
2015
2016
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
0%
0%
2010
Note: Thermal capacity factor includes all fossil fuel-fired thermal capacity. Wind and solar
curtailment figures are not national averages, but refer to select provinces which exhibited the
worst cases of curtailment nationally over the period
16
Michael Liebreich
Bloomberg New Energy Finance Summit, 25 April 2017
2011
2012
2013
2014
2015
2016
Source: Bloomberg New Energy Finance,
China Electricity Council, National Energy Administration
@mliebreich
Price of renewable energy in India
The cost of solar power is
now cheaper than coal in
this country.
Piyush Goyal
Minister of State for Power, Coal, New &
Renewable Energy and Mines, India
Image: Twitter
17
Michael Liebreich
Bloomberg New Energy Finance Summit, 25 April 2017
@mliebreich
India snapshot
Annual capacity additions vs Modi plan
India clean energy investment
GW
25
$bn
16
Rate needed to
achieve Modi plan
13.7
14
20
12
10
15
9.6
9.0
8.5
8.1
8
10
6.8
5.4
6
Annual capacity additions
5
9.2
6.6
5.8
4.3
4
2.8
3.2
2
0
0
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
Note: Modi plan annual additions rate assumes linear trajectory to 175GW 2022 target. Figures exclude large hydro
18
Michael Liebreich
Bloomberg New Energy Finance Summit, 25 April 2017
Source: Bloomberg New Energy Finance
@mliebreich
Europe new investment in clean energy
($ billion)
19
Michael Liebreich
Bloomberg New Energy Finance Summit, 25 April 2017
@mliebreich
20
Michael Liebreich
Bloomberg New Energy Finance Summit, 25 April 2017
@mliebreich
Emissions from coal-fired power,
2008-16
tCO2e/yr
tCO2e/yr
450,000
450,000
450,000
450,000
450,000
450,000
450,000
450,000
450,000
450,000
400,000
400,000
400,000
400,000
400,000
400,000
400,000
400,000
400,000
400,000
350,000
350,000
350,000
350,000
350,000
350,000
350,000
350,000
350,000
350,000
300,000
300,000
300,000
300,000
300,000
300,000
300,000
300,000
300,000
300,000
250,000
250,000
250,000
250,000
250,000
250,000
250,000
250,000
250,000
250,000
200,000
200,000
200,000
200,000
200,000
200,000
200,000
200,000
200,000
200,000
150,000
150,000
150,000
150,000
150,000
150,000
150,000
150,000
150,000
150,000
100,000
100,000
100,000
100,000
100,000
100,000
100,000
100,000
100,000
100,000
50,000
50,000
50,000
50,000
50,000
50,000
50,000
50,000
50,000
50,000
0
0
2008
2013
Germany
0
2008Poland
2013
0
2008 UK
2013
0
2008Greece
2013
0
0
0
0
0
2008
2013
2013
2008Spain
2013
2008 Italy
2013
2008
2013
2008
2013
Czech
Rep 2008
Bulgaria
Romania
Netherlands
Source: Bloomberg New Energy Finance, Eurostat
21
Michael Liebreich
Bloomberg New Energy Finance Summit, 25 April 2017
@mliebreich
US new investment in clean energy
($ billion)
22
Michael Liebreich
Bloomberg New Energy Finance Summit, 25 April 2017
@mliebreich
US wind installations
Annual
2008-16
Up 262%
Cumulative
GW
GW
16
90
14
80
12
70
60
10
50
8
40
6
30
4
20
2
10
0
0
2000 2002 2004 2006 2008 2010 2012 2014 2016
2000 2002 2004 2006 2008 2010 2012 2014 2016
Note: Cumulative over 2000–16 Source: Bloomberg New Energy Finance
23
Michael Liebreich
Bloomberg New Energy Finance Summit, 25 April 2017
@mliebreich
US solar installations
Annual
2008-16
Up 4,645%
Cumulative
GW
GW
16
45
14
40
12
35
30
10
25
8
20
6
15
4
10
2
5
0
0
2000 2002 2004 2006 2008 2010 2012 2014 2016
2000 2002 2004 2006 2008 2010 2012 2014 2016
Note: Cumulative over 2000–16 Source: Bloomberg New Energy Finance
24
Michael Liebreich
Bloomberg New Energy Finance Summit, 25 April 2017
@mliebreich
US small-scale solar build by type
GW
4.0
Up 143%
3.4
3.5
2.9
3.0
2.5
2.2
2.0
1.7
2.3
2.0
1.5
1.4
1.0
0.5
0.5
0.8
0.9
1.0
0.8
2012
2013
2014
2015
1.2
0.8
1.1
0.0
Commercial and industrial
2016e
Residential
Note: 2016 US residential and C&I PV build figures are estimated
25
Michael Liebreich
Bloomberg New Energy Finance Summit, 25 April 2017
Source: Bloomberg New Energy Finance
@mliebreich
US corporate procurement of clean
energy
Incremental build
(GW)
5.5
5.0
4.5
4.0
3.5
3.0
2.5
2.0
1.5
1.0
0.5
0.0
Cumulative build
(GW)
11
10
9
8
7
6
5
4
3
2
1
0
Up 5,150%
cumulatively
2008
Solar
2009
Wind
2010
2011
2012
2013
Biomass & Waste
2014
2015
Fuel Cells
2016
Cumulative
Note: Incremental build left axis, columns; cumulative build right axis, red line
Source: Bloomberg New Energy Finance
26
Michael Liebreich
Bloomberg New Energy Finance Summit, 25 April 2017
@mliebreich
US energy efficiency investment
US estimated investment in energy
efficiency
2008-15
$ billion (nominal)
Up 100%
14
12
Other
Energy Star-certified floor space in US
non-residential buildings
2008-15
Billions of square feet
Up 220%
4.5
4.0
Other
3.5
Mixed Use
Property
3.0
Warehouse and
Storage
2.5
Lodging
2.0
Healthcare
1.5
Mercantile
1.0
Education
0.5
Offices
10
Public
buildings
8
6
Commercial
& Industrial
4
2
Residential
0
'90
'95
'00
'05
'10
'15
Source: ACEEE, NAESCO, LBNL, CEE, IAEE, Bloomberg New Energy Finance
27
Michael Liebreich
0.0
1999
2001
2003
2005
2007
2009
Source: EPA, Bloomberg New Energy Finance
Bloomberg New Energy Finance Summit, 25 April 2017
@mliebreich
2011
2013
2015
US electric smart meter deployment
US smart meter deployments (million units)
Annual
Cumulative
14
80
12
70
10
60
50
8
12.2
6
40
12.6
30
10.0
4
2
Up 4,300%
cumulative
5.9
3.6
5.2
6.7
4.1
5.9
0
20
10
0
2008 2009 2010 2011 2012 2013 2014 2015 2016
Notes: Includes data for smart electricity meters, excludes automated meters. Smart
meters are defined as those capable of two-way communication over a fixed network.
28
Michael Liebreich
Bloomberg New Energy Finance Summit, 25 April 2017
Source: Bloomberg New Energy Finance, EIA
@mliebreich
US gas production and rig efficiency
New-well production per rig (‘000 cf/day)
US monthly natural gas production (bcf)
4,000
3,000
2007–17
Up 388%
3,500
3,000
2,500
2,000
2,500
1,500
2,000
2007–17
Up 35%
1,500
1,000
1,000
500
500
0
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
0
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
Source: EIA
29
Michael Liebreich
Bloomberg New Energy Finance Summit, 25 April 2017
@mliebreich
US oil production and rig efficiency
New-well production per rig (bbl/day)
US monthly oil production (mbbl)
800
350
700
600
2007–17
Up 83%
300
2007–17
Up 1,300%
250
500
200
400
150
300
100
200
50
100
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
0
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
Source: EIA
30
Michael Liebreich
Bloomberg New Energy Finance Summit, 25 April 2017
@mliebreich
Fuel economy regulations for China,
US and Europe, 2000-25 (litres/100km)
L/100 km
2000–14
Up 21%
9.0
8.0
7.0
US
6.0
5.0
EU
China: 4.9
4.0
EU: 4.1
US: 4.2
China
3.0
2.0
1.0
0.0
2000
Achieved fuel consumption
2005
2010
Future standard
2015
Note: The fuel economy targets have been normalised to the CAFE testing procedure. US targets are for passenger cars only.
31
Michael Liebreich
Bloomberg New Energy Finance Summit, 25 April 2017
2025
2020
Source: EPA, NHTSA, EU, ICCT
@mliebreich
Henry Hub gas prices
$/MMBTU
16
14
12
10
8
6
4
2
0
2008
2009
2010
2011
2012
2013
2014
2015
Michael Liebreich
2017
Source: Bloomberg
Note: Real 2017 $US
32
2016
Bloomberg New Energy Finance Summit, 25 April 2017
@mliebreich
US coal prices
$/short ton
180
160
140
120
100
80
60
40
20
0
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
Michael Liebreich
Bloomberg New Energy Finance Summit, 25 April 2017
2015
2016
Source: Bloomberg
Note: Central Appalachian benchmark price, real 2017 $US
33
2014
@mliebreich
Oil prices
$/bbl
180
160
140
120
100
80
60
40
20
0
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
Michael Liebreich
Bloomberg New Energy Finance Summit, 25 April 2017
2015
2016
2017
Source: Bloomberg
Note: Front-month Brent crude contract, real 2017 $US
34
2014
@mliebreich
Average US renewable energy
PPA prices
2008–16
PV down
83%
$/MWh
250
Utility-scale PV
200
150
2008–16
Wind down
71%
100
Wind
50
0
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
Note: Levelized, time-of-day adjusted contract price shown in real 2015 USD. 2016 PV PPA price based on preliminary data and subject to review.
Source: U.S. Department of Energy (LBNL), Bloomberg New Energy Finance
35
Michael Liebreich
Bloomberg New Energy Finance Summit, 25 April 2017
@mliebreich
US energy productivity
US energy productivity
GDP (indexed)
Energy productivity
Primary energy consumption (indexed)
Note: Indexed to 1990 levels. Values for 2016 energy consumption are projected,
accounting for seasonality, based on latest monthly values from EIA (data available
through October 2016). GDP is real and chained (2009 dollars); annual growth rate for
GDP for 2016 is based on consensus of economic forecasts gathered on the Bloomberg
Terminal as of January 2017.
36
Michael Liebreich
Source: US Energy Information Administration (EIA), Bureau of Economic Analysis,
Bloomberg Terminal
Bloomberg New Energy Finance Summit, 25 April 2017
@mliebreich
2016
2014
2012
2008
2006
2004
2002
2000
1998
1996
1994
1992
1990
2016
2014
2012
2010
2008
2006
2004
2002
2000
1998
1996
1994
1992
1.9
1.8
1.7
1.6
1.5
1.4
1.3
1.2
1.1
1.0
0.9
1990
2008-16
Up 13%
$ trillion of GDP/quadrillion BTU
0.20
0.18
0.16
0.14
0.12
0.10
0.08
0.06
0.04
0.02
0.00
2010
US GDP and primary energy
consumption
Greenhouse gas emissions and
progress towards targets
US power sector emissions
US total emissions
MtCO2e
MtCO2e
3,000
8,000
7,000
2,500
Power sector
emissions
Obama
2020 target
6,000
Total emissions
including LULUCF
2,000
5,000
2025 Paris
goal
4,000
1,500
2008-16
Down 23%
1,000
~50%
towards
Paris goal
3,000
2,000
500
1,000
0
0
1990
1995
2000
2005
2010
2015
2020
2025
1990
1995
2000
2005
2010
2015
2020
2025
Source: Bloomberg New Energy Finance, EIA, EPA
37
Michael Liebreich
Bloomberg New Energy Finance Summit, 25 April 2017
@mliebreich
Share of US personal expenditure on
energy
Electricity & gas
Gasoline
8%
2008-16
Down 20%
8%
6%
6%
4%
4%
2%
2%
0%
1960 65
70
75
80
85
90
95 2000 05
10
15
0%
1960 65
2008-16
Down 43%
70
75
80
85
Source: US Bureau of Economic Analysis, Bloomberg New Energy Finance
38
Michael Liebreich
Bloomberg New Energy Finance Summit, 25 April 2017
@mliebreich
90
95 2000 05
10
15
US power sector fuel mix
Generation by source
Change in generation 2007-16
TWh/yr
TWh/yr
800
2,500
600
Coal
2,000
400
Gas
+483TWh/yr
200
1,500
Renewables
+256TWh/yr
0
Natural gas
1,000
Power demand
-78TWh/yr
-200
Nuclear
-400
Coal
-776TWh/yr
500
Renewables
-600
Oil
0
-800
1990
1995
2000
2005
2010
2015
Displaced coal
Energy efficiency
Gas
Renewables
Source: EIA
39
Michael Liebreich
Bloomberg New Energy Finance Summit, 25 April 2017
@mliebreich
US coal jobs and productivity
Jobs
Productivity
Thousand jobs
Tonnes per employee per year
700
12,000
600
10,000
500
8,000
400
6,000
300
4,000
200
2,000
100
0
0
1931
40
50
60
70
80
90
2000
10
15
1931
40
50
60
70
80
90
Source: Bloomberg New Energy Finance, US Department of Labour
40
Michael Liebreich
Bloomberg New Energy Finance Summit, 25 April 2017
@mliebreich
2000
10
15
New generation of mining trucks
Image: Komatsu
41
Michael Liebreich
Bloomberg New Energy Finance Summit, 25 April 2017
@mliebreich
Adani Mining Carmichael coal mine
Queensland Australia
When we ramp up the [Carmichael]
mine, everything will be autonomous
from mine to port. In our eyes, this is
the mine of the future.”
Jeyakumar “JJ” Janakaraju
Adani Mining CEO
Image: Adani Mining
42
Michael Liebreich
Bloomberg New Energy Finance Summit, 25 April 2017
@mliebreich
Making America Great Again?
Image: White House; EPA
43
Michael Liebreich
Bloomberg New Energy Finance Summit, 25 April 2017
@mliebreich
2015 BNEF SUMMIT KEYNOTE
AN AGE OF PLENTY…
… ON STEROIDS
44
Michael Liebreich
Bloomberg New Energy Finance Summit, 25 April 2017
@mliebreich
US administration views on climate
change
“The concept of global warming was created
by and for the Chinese in order to make US
manufacturing non-competitive”
“I would not agree that [human activity] is a
primary contributor to the global warming
that we see”
Scott Pruitt
EPA Director
Donald Trump, US Presidential Candidate 2016
(now President)
“Climate change could be happening and it
could be a part of human action, but its costs
in the near term certainly are not great”
Jeff Sessions, 2015
(now US Attorney General)
45
Michael Liebreich
“[Climate change] is all one contrived phony
mess that is falling apart under its own
weight. Al Gore is a false prophet of a secular
carbon cult”
Rick Perry, US Presidential Candidate 2012
(now Secretary of Energy)
Bloomberg New Energy Finance Summit, 25 April 2017
@mliebreich
I’m not a climate scientist but…
Investing in
fossil-fuel energy
and transport
assets…
means we
emit more
greenhouse
gases…
which
accumulate in
the
atmosphere…
(NASA et al.)
(NOAA et al.)
driving human
climate
forcing…
thereby
pushing up
temperatures...
and causing
climate
impacts
(EPA et al.)
(Berkeley et al.)
(IPCC et al.)
Source: Various; BNEF
46
Michael Liebreich
Bloomberg New Energy Finance Summit, 25 April 2017
@mliebreich
Climate-related flood risk
Mar a Lago Club, Miami, Florida
2016
2030
2045
Note: Blue areas indicate risk of flooding.
47
Michael Liebreich
Source: Coastal Risk Consulting © Mapbox, © OpenStreetMap Graphic: Jan Diehm/The Guardian
Bloomberg New Energy Finance Summit, 25 April 2017
@mliebreich
US public view of climate change
Do you believe increases in the Earth’s temperature are due
more to the effects of pollution from human activities or natural
changes in the environment that are not due to human activities?
68%
Human activity
61%
61%
59%
61%
54%
42%
33%
33%
35%
57%
52%
43%
39%
55%
41%
35%
Natural causes
2001
03
05
07
09
11
29%
13
15
17
Source: Gallup
48
Michael Liebreich
Bloomberg New Energy Finance Summit, 25 April 2017
@mliebreich
Kentucky Coal Museum’s solar roof
Harlan County
Image: EKB TV
49
Michael Liebreich
Bloomberg New Energy Finance Summit, 25 April 2017
@mliebreich
Keeping America Great!
Images: various companies
50
Michael Liebreich
Bloomberg New Energy Finance Summit, 25 April 2017
@mliebreich
BNEF global EV sales forecast by
region
EV penetration
by 2040
35-47% of new
cars
Millions
25
20
Rest of the world
15
Japan
China
10
USA
Europe
5
0
2016
2018
2020
2022
2024
2026
2028
2030
Note: Forecast uses Gasoline and electricity prices from EIA’s 2015 Annual Energy Outlook ‘Low Oil Price’ scenario (ranging from $50 to $65 per barrel between 2015 and 2025).
Source: Bloomberg New Energy Finance.
51
Michael Liebreich
Bloomberg New Energy Finance Summit, 25 April 2017
@mliebreich
The Norwegian experience
Split of annual car sales by type
1.4%
2.8%
2.9%
4.5%
5.5%
6.4%
20.1%
28.4%
12.5%
1.2%
6.9%
35.2%
Vehicle choices
29% of new
cars in Norway
have plugs
17.1%
15.7%
5.2%
7.1%
13.3%
Battery
11.2%
Plug-in hybrid
30.7%
29.7%
Audi A7 Q
Tesla S 60D
$44,392
$75,117
$82,363
$75,117
Hybrid
28.3%
Gasoline
75.5%
64.3%
52.8%
2011
2012
2013
48.7%
2014
Diesel
40.9%
2015
Price
(without tax):
31.5%
2016
Price
(with tax):
Source: Bloomberg New Energy Finance, Ofv.no
52
Michael Liebreich
Bloomberg New Energy Finance Summit, 25 April 2017
@mliebreich
Lithium-ion battery pack prices are
down 73% since 2010
BNEF 2016 battery pack price survey results
$1,000/kWh
$800/kWh
$642/kWh
$599/kWh
$540/kWh
$350/kWh
$273/kWh
2010
53
11
Michael Liebreich
12
13
14
15
Bloomberg New Energy Finance Summit, 25 April 2017
16
@mliebreich
Source: Bloomberg New Energy Finance
Lithium-ion battery pack prices will
drop another 75% by 2030
Lithium-ion battery price forecast
Source: Bloomberg New Energy Finance
54
Michael Liebreich
Bloomberg New Energy Finance Summit, 25 April 2017
@mliebreich
BEV model availability, 2008-20
Land Rover
Defender
Trumpchi
GS4
Toyota
RAV4
SUVs/Trucks
VW
Budd-e
M-B B-Class BYD e6
Jaguar
I-Pace
Mitsubishi eX
Tesla
Model Y*
NIO ES8*
Tesla VW I.D.*
pickup*
BMW i5
Tesla
Model X
Chehejia
SUV*
VW I.D. CROZZ
Volvo 40.2*
M-B EQ
Audi E-tron
Quattro
Porsche E-sport
Renault DeZir
Sports cars
Qianto Q50
Venturi Fetish Tesla Roadster
Tesla Model S
Aston Martin
GLM G4 NIO EP9
Exagon Furtive
RapidE
Mahindra eVerito
Sedans
ChangAn
Eado
NIO EVE
Mullen 700e
CODA EV
Tesla Model 3
Kia Ray
LeEco LeSEE
Audi E-tron
Sportback
BAIC EU260
JAC iEV4 Renault Fluence
BYD e5
Honda Clarity
Lucid Air
Faraday
FF91
BMW i3
Hyundai
BlueOn M-B E-Cell
Hatchbacks
Audi R8 E-tron
Geely Emgrand
SAIC E-Lavida
VW e-Golf
Chevy Bolt VW I.D.
Chevy Spark
Honda Fit
Ford Focus Nissan Leaf
BMW mini e
Fiat 500e
Mitsubishi i-MiEV
Runabouts
Renault Zoe ZE
Nissan Leaf 2*
VW
e-Up Seat Mii*
Mahindra e2o
Bollore
Bluesummer
Smart
Renault Twizy ForTwo
Ford Transit
Kandi Panda
2009
2008
2010
2012
2013
2014
2015
2016
2017
2018
2019
2020
2011
VW e-Bulli
BYD T3
Nissan NV200
Small vans
Tata Smith Edison
IRIS
Peugeot Partner
M-B Vito
0
55
Tesla Roadster*
M-B SLS eDrive
Hyundai Ioniq
Michael Liebreich
50
100
Notes: Not exhaustive.
(*) Range is estimate
ChangAn EM80
VW I.D. BUZZ
Renault Kangoo
150
Source: Bloomberg New Energy
Finance, Images various.
200
250
Bloomberg New Energy Finance Summit, 25 April 2017
300
@mliebreich
350+ miles range per charge
Tesla’s gamble
WWII plane
production
Source: Tesla; Bloomberg https://www.bloomberg.com/news/articles/2017-03-27/tesla-model-3-ramp-up-aims-to-crush-bmw-and-mercedes; Bloomberg New Energy Finance, Library of
Congress WWII Companion
56
Michael Liebreich
Bloomberg New Energy Finance Summit, 25 April 2017
@mliebreich
Car company market capitalisation
$ billion
80
70
Ford
60
50
GM
40
Tesla
30
20
10
FCM
0
2011
2012
2013
2014
2015
2016
2017
Source: Bloomberg, Bloomberg New Energy Finance
57
Michael Liebreich
Bloomberg New Energy Finance Summit, 25 April 2017
@mliebreich
58
Michael Liebreich
2019: Intel + Delphi +
Mobileye Level 4
2020
Google's Level 4
2018
Tesla's Level 4
'Autopilot'
Audi's Level 3 'Traffic
Jam Pilot' on A8
2017
Ford's Level 2 'Traffic Jam
Assist' and 'Fully
Automated Parking'
2016
BMW's Level 2 on
'Traffic Jam Assistant'
Audi's Level 2 'Traffic
Jam Assist'
2016-
Nissan's Level 2
'ProPILOT'
Volvo's Level 2 'Pilot
Assist' on S90
Honda's Level 2
'Sensing'
Nissan's Level 4
'ProPILOT 3.0'
Audi's Level 3+
Honda's Level 3 'onramp to off-ramp'
Kia's Level 3 'Drive
Wise'
Volvo's Level 4 DriveMe program
Nissan's, Level 3
'ProPILOT 2.0'
GM's Level 2 'Super
Cruise'
Mercedes's Level 2
'Dystonic Pilot' on EClass
2015: Tesla's Level 2
'Autopilot'
2013: Mercedes's Level
2 'Dystonic Plus'
Disclosed timelines for autonomous vehicles from select companies,
2016 – 40
2021: BMW's Level 4 in
'iNext'
2020+
Bloomberg New Energy Finance Summit, 25 April 2017
2021: Ford's Level 4
2022: Lyft Level 4 ride
hailing cars
2025: VW's Level 4 'ID
Pilot' i
2030: Kia's Level 4
'Urban Autonomous
Driving'
2030: Uber's Level 4
fleet in 2030
2040: Honda's Level 4
by 2040 in all models
Legend
Level 2
Level 3
@mliebreich
Level 4/5
Source: Bloomberg New
Energy Finance
5000 x improvement in safety
performance required
AVs: distance between
human interventions (miles)
Google Waymo
Humans: distance between
crashes (miles)
x ~ 100*
5,128
BMW
638
Ford
197
Nissan
146
Uber (2017)
105
US Average
VW (2015)
57
GM Cruise
54
Delphi
17
Tesla
3
Mercedes
2
Bosch
1
Michael Liebreich
Commercial
aviation
525,000
15,342
Buses
9,178
Mainline trains
Cars & light trucks
6,667
137
x ~ 50
Motorcycles
* Assumes one in 10 human interventions might otherwise have resulted in an accident
59
Distance between
fatalities (million miles)
Bloomberg New Energy Finance Summit, 25 April 2017
4.7
Source: California DMV; Recode; NHTSA; FHWA; BNEF
@mliebreich
Rich people having empty cars drive
round the block instead of parking
Image: Limousine Service Zurich
60
Michael Liebreich
Bloomberg New Energy Finance Summit, 25 April 2017
@mliebreich
When 20,789 people all want to get to
Madison Square Gardens at the same time
Image: Google Maps
61
Michael Liebreich
Bloomberg New Energy Finance Summit, 25 April 2017
@mliebreich
Algorithms which are individually
smart and collectively dumb
Image: Obianuju Okafor
62
Michael Liebreich
Bloomberg New Energy Finance Summit, 25 April 2017
@mliebreich
Secretary Perry’s 60-day review
To what extent are regulatory
burdens, subsidies and tax policies
responsible for forcing the premature
retirement of baseload power plants
Rick Perry
Secretary of Energy
Image: Bloomberg
63
Michael Liebreich
Bloomberg New Energy Finance Summit, 25 April 2017
@mliebreich
Renewable energy excl. large hydro,
proportion of power generation, 2006-16
Canada
UK
China
25%
5%
6%
Germany
2%
29%
6%
10%
9%
Japan
US
Spain
3%
9%
12%
7%
Italy
30%
25%
13%
12%
Lowest
India
Mid
Australia
Highest
6%
4%
Brazil
No data
South
Africa
18%
6%
1%
3%
12%
3%
Note: Excludes large hydro Source: Bloomberg New Energy Finance
64
Michael Liebreich
Bloomberg New Energy Finance Summit, 25 April 2017
@mliebreich
Renewable energy excl. large hydro,
proportion of power generation,
2006-16
Minnesota
South Dakota
Idaho
100%
Vermont
Maine
17%
47%
30%
7%
2%
23%
54%
38%
20%
New York
California
30%
14%
6%
Kansas
8%
Iowa
Key: RE penetration
0%
20%
5%
2%
Michael Liebreich
39%
2%
50%+
65
Oklahoma
Texas
30%
13%
26%
3%
Bloomberg New Energy Finance Summit, 25 April 2017
Source: Bloomberg New Energy Finance, EIA
@mliebreich
Variable renewables high penetration
13 February 2017
SPP
52% wind
25 December 2016
Scotland
153% wind
9 April 2017
UK 56%
wind & solar
23 March 2017
CAISO
46% wind & solar
November 2017
ERCOT
45% wind
9 July 2015
Denmark
140% wind
May 2016
Germany
67% wind & solar
November 2015
Spain
70% wind
26 December 2014
South Australia
61% wind & solar
Source: Bloomberg New Energy Finance, various
66
Michael Liebreich
Bloomberg New Energy Finance Summit, 25 April 2017
@mliebreich
US thermal capacity factors
US average
Texas
Florida
42%
42%
50%
40%
40%
45%
38%
38%
40%
36%
36%
35%
34%
34%
2010 2011 2012 2013 2014 2015 2016 2017
30%
2010 2011 2012 2013 2014 2015 2016 2017
2010 2011 2012 2013 2014 2015 2016 2017
Pennsylvania
California
Ohio
55%
50%
45%
40%
35%
30%
35%
46%
44%
42%
40%
38%
36%
30%
25%
20%
15%
2010 2011 2012 2013 2014 2015 2016 2017
2010 2011 2012 2013 2014 2015 2016 2017
Note: Includes coal and gas capacity. 2017 is based on YTD generation and operational capacities reported in January.
Excludes backup capacity.
67
Michael Liebreich
Bloomberg New Energy Finance Summit, 25 April 2017
2010 2011 2012 2013 2014 2015 2016 2017
Source: Bloomberg New Energy Finance, EIA
@mliebreich
Capacity markets
March of capacity markets
Regions recently or currently implementing
capacity-based mechanisms include:
Weaknesses of capacity markets
Over-procurement
• Inaccurate predictions of
supply and demand
• Political risk aversion
Innovation suppressed by:
• Artificially-shaped demand
• Bias towards incumbents
• Picking of winners
68
Michael Liebreich
Bloomberg New Energy Finance Summit, 25 April 2017
@mliebreich
Lots more variable renewables
Evolving structure of power supply
Added storage, interconnections
Reduced demand (exc. EVs)
Past – winter
Current – winter
Future – winter
80
80
80
60
60
60
40
40
40
20
20
20
0
0
0
-20
-20
-20
-40
-40
Monday
Tuesday
Wednesday
Thursday
Friday
Saturday
-40
Monday
Sunday
Tuesday
Past – summer
Wednesday
Thursday
Friday
Saturday
Sunday
Monday
Current – summer
80
80
60
60
60
40
40
40
20
20
20
0
0
0
-20
-20
-20
Monday
Tuesday
Peaking fossil
69
90.0
70.0
Wednesday
Baseload fossil
Thursday
Nuclear
Michael Liebreich
Friday
CHP
Saturday
Hydro
Sunday
Baseload RE
Thursday
Friday
Saturday
Sunday
Saturday
Sunday
-40
-40
-40
Wednesday
Future – summer
80
GW
Tuesday
Monday
Solar
Wind
Tuesday
Wednesday
Thursday
Pumped hydro generation/Storage
Friday
Saturday
Imports
Monday
Sunday
Exports/curtailment/DR
Bloomberg New Energy Finance Summit, 25 April 2017
Tuesday
Wednesday
Thursday
Friday
Source: Bloomberg New Energy Finance
@mliebreich
Evolving structure of power supply
1. Whatever we come up with must work
winter and summer (doh!)
Past – winter
Current – winter
Future – winter
80
2. Practically impossible to get rid of all
fossil fuel use
3. Even huge storage gets overwhelmed
by wind variability
60
40
20
0
-20
-40
Monday
Past 4.
– summer
Massive
Tuesday
Current
– summer
volatility, enormous
ramp
Wednesday
Thursday
Friday
Saturday
Sunday
Saturday
Sunday
Future – summer
80
rates
60
5. Need lots of interconnection capacity
(else duck curves, curtailment)
40
20
0
-20
6. And if you think that’s complicated, it
has to work at every node too!
70
Michael Liebreich
Bloomberg New Energy Finance Summit, 25 April 2017
-40
Monday
Tuesday
Wednesday
Thursday
Friday
Source: Bloomberg New Energy Finance
@mliebreich
Evolving structure of power supply
Flexible generation – winter
Low carbon generation – winter
Future – winter
80
80
80
60
60
60
40
40
40
20
20
20
0
0
0
-20
-20
-20
-40
-40
Monday
Tuesday
Wednesday
Thursday
Friday
Saturday
-40
Monday
Sunday
Flexible generation – summer
Tuesday
Wednesday
Thursday
Friday
Saturday
Sunday
Monday
Low carbon generation – summer
80
80
60
60
60
40
40
40
20
20
20
0
0
0
-20
-20
-20
Monday
Tuesday
Peaking fossil
71
90.0
70.0
Wednesday
Baseload fossil
Thursday
Nuclear
Michael Liebreich
Friday
CHP
Saturday
Hydro
Sunday
Baseload RE
Thursday
Friday
Saturday
Sunday
Saturday
Sunday
-40
-40
GW
Wednesday
Future – summer
80
-40
Tuesday
Monday
Solar
Wind
Tuesday
Wednesday
Thursday
Pumped hydro generation/Storage
Friday
Saturday
Imports
Monday
Sunday
Exports/curtailment/DR
Bloomberg New Energy Finance Summit, 25 April 2017
Tuesday
Wednesday
Thursday
Friday
Source: Bloomberg New Energy Finance
@mliebreich
Evolving structure of power supply
Flexible generation – winter
1. Very cheap wind & solar
(“base cost renewables”)
Low carbon generation – winter
Future – winter
80
60
40
2. Plus must-run CHP and
nuclear (and CCS?)
20
0
-20
-40
3. Zero mid-day power
Flexible
generation
price
every
day in– summer
sunny
countries and windy days
Monday
Tuesday
Wednesday
Thursday
Friday
Saturday
Sunday
Low carbon generation – summer
Future – summer
80
60
40
4. Dependent on flexible
power to meet nonsunny, non-windy times
20
0
-20
-40
Monday
Tuesday
Wednesday
Thursday
Friday
Saturday
Sunday
Source: Bloomberg New Energy Finance
72
Michael Liebreich
Bloomberg New Energy Finance Summit, 25 April 2017
@mliebreich
Evolving structure of power supply
Flexible generation – winter
Low carbon generation – winter
Future – winter
1. Demand response is likely
to be the cheapest
80
60
40
20
2. Storage
0
-20
-40
Monday
Tuesday
Wednesday
Thursday
Friday
Saturday
Sunday
Flexible generation – summer
3.Low
Interconnections
carbon generation – summer
Future – summer
80
60
4. Fossil peakers
40
20
0
-20
-40
Monday
Tuesday
Wednesday
Thursday
Friday
Saturday
Sunday
5. In case that’s not enough,
there will be curtailment
Source: Bloomberg New Energy Finance
73
Michael Liebreich
Bloomberg New Energy Finance Summit, 25 April 2017
@mliebreich
Evolving structure of power supply
Option A: “Central Planning”
30
20
Centrally designed capacity
market, with regulated returns
10
0
Centrally provisioned
interconnections, with regulated
returns
-10
-20
-30
Curtailment
-40
-50
Monday
Tuesday WednesdayThursday
Friday
Saturday
Sunday
Source: Bloomberg New Energy Finance
74
Michael Liebreich
Bloomberg New Energy Finance Summit, 25 April 2017
@mliebreich
Evolving structure of power supply
Option B: “Demand-Led”
30
Storage/DR
Peaking fossil
Exports/Curtailment
20
2. Reliability standards at the retail level
10
3. Carbon regulation via carbon price,
carbon intensity or retirement schedule
0
-10
30
20
10
0
-10
-20
-30
-40
-50
1. Competitive, technology-neutral, liquid
markets across location and time
-20
Monday
Tuesday
Wednesday
Thursday
Friday
Saturday
-30
4. Flexibility costs charged to those who
cause them
Sunday
5. Certificates of origin for imported power
-40
6. Cost of stability-related ancillary
services borne by TSOs and DSOs
-50
Monday
Tuesday WednesdayThursday
Friday
Saturday
Sunday
Source: Bloomberg New Energy Finance
75
Michael Liebreich
Bloomberg New Energy Finance Summit, 25 April 2017
@mliebreich
TOWARDS
DEMAND-LED
FLEXIBILITY
MARKETS
76
Michael Liebreich
Bloomberg New Energy Finance Summit, 25 April 2017
@mliebreich
Coverage.
Renewable Energy
Power & Utilities
Gas
Carbon Markets & Climate
Negotiations
Energy Smart Technologies
Storage
Electric Vehicles
Mobility and Autonomous Driving
Frontier Power
Emerging Technologies
[email protected]
about.bnef.com
@BloombergNEF
Thanks!
Bloomberg New Energy Finance is a research firm that helps energy
professionals generate opportunities. With a team of experts spread
across six continents, BNEF provides independent analysis and insight,
enabling decision-makers to navigate change in an evolving energy
economy.
BNEF research and analysis is accessible via web and mobile platforms,
as well as on the Bloomberg Terminal.
Michael Liebreich
@mliebreich