Clean Energy, Development and 21st Century Power Systems UNU-Wider June 2014

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About JISEA

JISEA seeks to guide the transformation of

the global energy economy through

comprehensive, transdisciplinary research

focused on the nexus of energy, finance,

and society.

JISEA Founding

Institutions

NREL

University of

Colorado-Boulder

Colorado School of

Mines

Colorado State

University

Massachusetts

Institute of

Technology

Stanford University

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• More than 1550 GW Global Power, with

more than 550 GW non-hydro

• Solar PV 140GW, and added more than

39 GW in 2013

• Bio power and Wind provide more than

400GW capacity

• LEED-certified commercial buildings

more than 10,000 +

• Costs have been significantly reduced

• Clean energy grew from $1B/year to a

$200+B/year market Globally

A Role for Clean Energy— Decades of Real Progress

5/11

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Countries with Clean Energy Policies

144 Countries

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Types of Clean Energy Policies

80

70

60

50

40

30

20

0

Num

ber

of C

ountr

ies

6

Source: Bloomberg New Energy Finance

12.119.4

36.446.0 47.8

39.0

54.8

75.6

58.9 56.0

'04 '05 '06 '07 '08 '09 '10 '11 '12 '13

North America & Caribbean

17.6 22.228.9

39.049.3

61.9

78.1

103.1108.9

120.6

'04 '05 '06 '07 '08 '09 '10 '11 '12 '13

Asia & Oceania

0.9 3.8 5.812.3 15.6

10.5 13.4 12.6 12.3 9.6

'04 '05 '06 '07 '08 '09 '10 '11 '12 '13

Central & South America

0.5 0.6 1.0 1.7 2.6 1.5 4.5 3.511.0 10.0

'04 '05 '06 '07 '08 '09 '10 '11 '12 '13

Middle East & Africa

23.834.0

44.1

68.079.3 82.8

110.8123.2

95.1

57.8

'04 '05 '06 '07 '08 '09 '10 '11 '12 '13

Europe

New investment in clean energy

2004-2013 ($bn)

7

2013 Investment in Renewable Energy

Source: REN21/BNEF

8

Global Solar Capacity Growth

9

Solar Hot Water

10

Micro Economics….

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Source: Bloomberg New Energy Finance

FOSSIL FUEL AND NUCLEAR RENEWABLES

Global power generation capacity

additions 2010 – 2030 (GW)

10687 78

6452

39

2010 2013 2015 2020 2025 2030

Nuclear

Oil

Gas

Coal

Forecast

6083

107

155

196

264

2010 2013 2015 2020 2025 2030

Marine

Solar

Wind

Biomass& waste

Geotherm.

Forecast

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Energiewende: impact on retail prices

Source: Bloomberg New Energy Finance, Bloomberg L.P., BSW Solar, Eurostat, Federal Communications Commission

US FIXED LINE VS. MOBILE PRICES

($/MIN)

GERMAN FIT VS. RESIDENTIAL POWER

PRICES (EUR/MWH)

Feed-in tariff

<10kW

Res. power price

Q12007

Q12008

Q12009

Q12010

Q12011

Q12012

Q12013

0

0.1

0.2

0.3

0.4

0.5

0.6

Mobile

Land line

0.0

0.1

0.2

0.3

0.4

0.5

0.6

1993 2000 2007

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Impacts on Traditional Utility Finances

Source: Edison Electric Institute, 2014

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Power Sector Modernization Components

Renewable Energy

Energy Efficiency

Analysis, Modeling and Simulation

Energy Storage

Sensors and Controls

Interconnection

Policy and Regulation

Interoperability

Markets and Business Models

Emerging Technologies Scales and Challenges Solutions

Sustainable Transportation

Consumer

City

Regional

More Variable Supply and Demand Limited Grid Flexibility Aging Infrastructure Vulnerability to Extreme Events Challenges to Reliability Increasing Costs

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The Evolving Power System …

How Soon? How Fast? What Business Model(s)?

Figure: courtesy of B. Hannegan, EPRI

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Implications for Institutional Infrastructure

• Role of the “Utility”

• Independent System Operators

• 3rd Party Sales, Service, Energy Providers

• Reliability Requirements

• Rural Electrification Policy & Regulation

• Competitive?

• Service Territories?

• Minigrid Operators?

• Transitional Pathways to a distributed grid?

• Fundamental Rethinking of “Energy Provision”

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Today’s Options…