medium- term renewable energy market report 2016€¦ · medium- term renewable energy market...
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© OECD/IEA 2016 © OECD/IEA 2016
Launch Presentation
Singapore International Energy Week, Singapore, 25 October 2016
Medium- Term Renewable Energy Market Report 2016
© OECD/IEA 2016
Context
A year of records for renewable electricity
A record amount of new capacity was installed in 2015
Total capacity has now overtaken coal
COP21 Paris Agreement gives momentum to renewables
Local air pollution & energy security are also key drivers
Energy investment flows confirm shift to renewables
But policy makers need to heighten their commitments and provide investors more clarity & certainty
© OECD/IEA 2016
0
200
400
600
800
1 000
MTRMR 2015 Forecast 2014-2020 MTRMR 2016 Forecast 2015-21
Net ad
ditio
ns (GW
) Others
Brazil
India
China
Japan
United States
EU28
New policies underpin a more bullish forecast for renewables
China remains key growth market for renewable capacity, while the United States surpasses the EU for the first time
Renewable electricity capacity growth (GW) in MTRMR’s main case
13%
© OECD/IEA 2016
Renewables to remain fastest growing source of electricity generation
Generation from renewables to rise by almost two-fifths over 2015-2021, pushing their share of total electricity generation from 23% to 28%
Indexed electricity generation by fuel (2001-21)
100 120 140 160 180 200 220 240 260 280
2001 2003 2005 2007 2009 2011 2013 2015 2017 2019 2021
2001
=10
0
Global power generation Coal Natural gas Renewable electricity generation
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A two-speed world for renewable electricity
The increase in generation from renewables in 2015-2021 represents 60% of the global increase in electricity output, but prospects vary across regionally
Electricity and renewable generation growth by country/region
0
500
1 000
1 500
China India ASEAN Africa EU28 United States Japan
TWh
Electricity generation growth (2015-21) Renewable generation growth (2015-21)
Source: Total electricity generation from World Energy Outlook 2016, forthcoming.
© OECD/IEA 2016
Wind and solar PV compensate for slower hydropower growth
Solar PV & wind account for almost 2/3 of rise in renewables generation; total renewable electricity overpasses 7600 TWh by 2021, equivalent to EU+US today
Renewable electricity generation by source 2015
71%
8%
15%
4%
2%
Hydropower
Bioenergy
Wind
Solar PV
Other renewables
Renewable electricity generation by source 2021
71%
8%
15%
4%
2%
Hydropower
Bioenergy
Wind
Solar PV
Other renewables
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Solar PV costs continue to decline with increasing competition
Utility-scale solar PV generation costs to fall by another quarter over 2015-21; competitive tenders may result in even faster cost reductions
Utility-scale solar PV generation cost and contract prices
0
100
200
300
400
500
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
USD/
MWh
Global reference UAE Brazil South Africa Germany Mexico Chile
Forecast
Tendered prices:
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More ambitious policies could further enhance the outlook in line 2°C target
Renewables are in line with NDC pledges by 2030 but reducing policy uncertainty and overcoming financing & grid integration challenges remain key to achieve 2°C target
Renewable electricity capacity additions in Accelerated Case vs. Main Case
0
50
100
150
200
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
GW
Mainc case Accelerated case
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Renewables to dominate electricity growth, but less progress in heat and transport
The share of renewables rises in all sectors, despite persistent challenges in heat & transport; interactions between energy efficiency & renewables become critical
Share of renewables in electricity, heat and transport sectors
0%
5%
10%
15%
20%
25%
30%
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Share of ren
ewab
les in sector de
man
d
Renewable electricity Renewable heat Biofuels in road transport
© OECD/IEA 2016
Biofuel production shifts to Asia, as EU and US slows
Structural challenges in the US & policy uncertainty post-2020 in the EU slow growth; Thailand, India & Indonesia have strengthened policies despite low oil prices
Biofuels production growth (billion litres)
0
5
10
15
20
United States EU28 Brazil Asia
Prod
uctio
n grow
th (billion
L)
Production growth 2009-15 Production growth 2015-21
© OECD/IEA 2016
Conclusions
Prospects for renewables electricity revised upwards, driven by policy improvements, cost reductions & efforts to improve air quality
The impact of lower fossil fuel prices on renewables varies by sector. Wind (onshore) & solar PV are the only technologies on track for a 2oC scenario
Competition in Asia between renewables & coal/gas will be critical to meeting global decarbonisation targets
Attracting investment in renewables hinges on appropriate market rules & regulations, particularly in markets with slow electricity demand growth
IEA is working to accelerate energy transition with its analysis on policy & technology and system integration of renewables