1. OVERVIEW AND PERSPECTIVES OF RENEWABLE
ENERGY AND ENERGY EFFICIENCY
IN THE MEDITERRANEAN REGION
Dr. Houda Ben Jannet Allal
Barcelona, 16 December 2013
3. MEDITERRANEAN REGION: IMPORTANT CROSSROADS FOR GLOBAL ENERGY MARKETS
7% of world population, 500 million people, 90
million more people by 2030, nearly all in the
South
10% world GDP, $7.5 trillion of GDP, 2.5% p.a.
average growth to 2030
8% of world’s primary energy demand
Transit corridor for global energy markets
Heavily impacted by current financial crisis and
important socio-political changes
High (untapped) for energy efficiency and
renewable energy
A Region particularly sensible to the impact of
climate change
3
4. ENERGY DEMAND OVERVIEW
Mtoe
1 500
1 400
1 300
MEDITERRANEAN ENERGY DEMAND OUTLOOK,
GDP (billion dollars
by Scenarios
(ppps 2005))
Proactive Scenario
Conservative Scenario
GDP
12 500
10 500
1 200
1 100
8 500
1 000
900
6 500
800
700
1990
4 500
2000
2010
2020
2030
40% increase in overall demand by 2030.
Only 20% increase if robust policies
and measures are put in place.
4
5. MEDITERRANEAN ENERGY CONSUMPTION PER CAPITA
kgoe/capita
3 000
North
South
2 000
1 000
0
1990
2000
2010
2020
2030
Today per-capita energy consumption in the South Mediterranean
countries is nearly three times less than the level of that in the
countries in the North.
By 2030 the North will still be consuming twice as much as the
South on a per capita basis.
5
6. ENERGY DEMAND BY FUEL
Mtoe
1400
Renewables
& Waste
1200
Hydro
1000
Nuclear
800
Gas
600
400
Oil
200
Coal
0
1990
2009
CS 2030
PS 2030
The future will remain fossil fuel based (70%) and
RES will take a significant share (up to 16%) under
the PS
6
7. HEAVY RELIANCE ON FOSSIL FUELS WILL ENDURE
Mtoe
MEDITERRANEAN FOSSIL FUEL DEMAND AND PRODUCTION OUTLOOK
1200
2009
Conservative Scenario 2030
Proactive Scenario 2030
1000
800
600
400
Gas
200
Oil
Coal
0
Demand Pr oduction
Demand Pr oduction
Demand Pr oduction
To 2030 the Mediterranean region will remain a net
importer of fossil fuels regardless of the Scenario.
Gas production could nearly double and demand
increase between 40% and 70% from 2010 to 2030
7
8. GAS ERA AND OIL PEAK
bcm
110
100
90
80
70
60
50
40
30
20
10
0
-10
GAS EXPORT POTENTIAL
2010
Algeria
Egypt
CS 2030
Libya
PS 2030
Israel
Export capacity would substantially increase under
the Proactive Scenario to over 180 bcm in 2030.
8
10. MEDITERRANEAN ELECTRICITY BOOM AHEAD
TWh
MEDITERRANEAN ELECTRICITYGENERATION
3000
South
2000
46%
42%
Nor th
30%
1000
16%
54%
58%
Conser vative
2030
Proactive
2030
70%
84%
0
1990
2009
Electricity demand in the South will nearly triple
by 2030.
14% could be saved under the alternative scenario.
10
11. INSTALLED GENERATION CAPACITY
GW
1 000
900
800
700
496 GW
Non-hydro Renewables
Hydro
Nuclear
Gas
Oil
Coal
600
500
878 GW
812 GW
27%
37%
15%
400
10%
18%
300
14%
200
33%
100
12%
13%
4%
9%
2009
2030 CS
10%
16%
10%
35%
28%
3%
6%
2030 PS
Over 380 GW will need to be added to meet electricity demand.
Less than 320 GW in a Proactive Scenario.
RES represent 42% of installed capacity in the CS; 53% in the PS
11
12. POWER GENERATION INVESTMENTS
billion Euros
400
Renewables
Nuclear
Fossil Fuels
300
200
100
0
CS
PS
North Med
CS
PS
South Med
Over 700 billion Euros will be needed to 2030.
Spared gas could compensate the additional cost of
clean generation technologies.
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14. RENEWABLES IN THE MEDITERRANEAN
Share of the Mediterranean in global renewable
energy demand
3500
3000
Mtoe
2500
2000
1500
1000
500
0
2009
CS 2030
PS 2030
World*
1609
2745
2745
MED
78.9
156
200
*World figures come from IEA New Policies Scenario
Renewables in the Mediterranean accounts for 5% of global total
renewable energy demand.
Renewables in the MED to account for 7.3% of RE energy demand by
2030 in the Conservative and 15% in the Proactive Scenario.
14
15. A SUNNY AND WINDY FUTURE
Mtoe
MEDITERRANEAN ENERGY DEMAND BY FUEL
1 400
Wind
1 300
Solar
Geother mal
1 200
Hydro
1 100
Biomass and
waste
Non Renewables
1 000
900
2010
Conser vative 2030
Proactive 2030
Renewables to supply 10% of primary energy demand by 2030
in the Conservative and 15% in the Proactive Scenario.
Most of the increase is expected to come from wind and solar.
Renewables will account for 42% of total installed generation
capacity in the Conservative and 53% in the Proactive Scenario.
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16. RENEWABLE ELECTRICITY GENERATION
2010
3 500
Hydro
14%
RES
6%
Coal
14%
3 000
2 500
Nuclear
25%
36%
Oil
8%
Renewables
Gas
33%
TWh
Hydro
2 000
Nuclear
1 500
Gas
1 000
Oil
500
0
1990
Coal
2000
2010
2020
2030
RES electricity increased by more than 2.5 times in 1990-2010
Renewables are expected to compete directly with natural gas
as the dominant electricity source by 2030 (over 1000
TWh), under the PS
16
20. CONSENSUS ON EE & RE IMPORTANCE
EIB / OME / UfM Conference on energy efficiency, 10
December 2013, Brussels
All stakeholders, one voice
Institutional and regulatory frameworks, subsidies,
electricity tariffs, exchange of best practices,
innovation …
Ministerial meeting, 11 December 2013, Brussels
Importance of EE and RE, but not only
UfM energy community
20
21. ELECTRICITY TARIFFS IN THE MEDITERRANEAN
Residential electricity tariffs in the
Mediterranean
2012
USD/kWh
0.40
Min
Max
0.37
0.35
0.30
0.28
0.27
0.25
0.25
0.23
0.19
0.20
0.16
0.15
0.16
0.12
0.16
0.11
0.11
0.09
0.08
0.05
0.09
0.06
0.02
0.05
0.02
Libya
0.05
Lebanon
0.05
0.13
0.13
0.10
0.15
0.01
Spain
Italy
EU
Turkey
Tunisia
Syria
Morocco
Jordan
Israel
Palestine
* average selling
Egypt
Algeria*
0.00
21
24. KEY MESSAGES (1)
Current energy trends in the Mediterranean are not
sustainable. Business as usual is not an option:
Overall energy demand could grow by 40% by 2030,
where fossil fuels will continue to dominate the energy
mix and natural gas will overtake oil.
Electricity boom ahead: average annual growth rate of
about 2.8% and 5% in the South: overall over 380 GW of
additional capacity needed.
The energy challenge is in the South:
Population will grow by over 80 million people;
Overall energy demand and CO2 emissions would
double;
Electricity demand would nearly triple; 200 GW of
generation capacity to be installed;
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25. KEY MESSAGES (2)
Under the Proactive Scenario, based on improving
efficiency and exploiting renewable energy potential:
10% savings in final energy by 2030
Reducing by nearly half the expected fossil fuel
import requirements by 2030
Electricity demand could be met with less
generation capacity and a higher share of
renewable sources
Electricity, through renewable technology and grid
developments, emerges as the strong driver for
reinforcing regional cooperation
But also energy efficiency which is nowadays
confirmed by all stakeholders as a MUST
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26. KEY MESSAGES (3)
Substantial potential for EE & RES in the region,
driven by decreasing costs of technologies and very
favorable climate conditions
Strong electricity demand growth=>role for RES-e
Evolving energy efficiency and renewable energy
policy support frameworks in some countries
Initiatives to improve bankability
… BUT… obstacles to be removed:
Subsidies to fossil fuels/low energy prices
Very diversified institutional frameworks
Need for interconnections
Stronger S-S and S-N cooperation needed
Innovation, R&D, capacity building and best
practices share ….
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Under a Business as Usual Scenario, Conservative as we call it, overall energy demand may growth by 40% over the coming 20 years. There is an alternative path, an objective scenario that we call Proactive, that will translate into only 20% increase in primary energy demand. This means that 12% of primary energy and 10% of final energy could be saved in the year 2030. This save is equivalent to the final energy consumption of the whole Region in 2030.In line with the estimated population and economic growth, 75% of the total increase of energy demand will come from the South. Today per capita energy consumption in the South is one third of per capita consumption in the North but this difference will be reduce in 2030 to 60%.
Whatever the scenario is, the energy mix will be dominated by fossil fuels in 2030, nearly 80% of all.Whatever the scenario is, gas share will keep on increasing and will overtake oil as the dominant energy source over the next decade. Oil is expected, however, to maintain its stronghold on the transport market.Under a Proactive scenario the Region could reduce by 30% its imports of hydrocarbons and multiply by 2 their export capacities.It is worth to highlight than in the Proactive scenario, renewable energy sources could represent 16% of the total primary energy mix.Regarding energy markets, transport and residential will increase their share, while industry is expected to loose ground.The electricity market will be the largest user of natural gas: over 50% of all gas consumption will be dedicated to power generation.
Despite a positive outlook for oil and gas production over the next 20 years, the Region will still need to import coal, oil and gas under both scenarios.Total oil production in the Mediterranean remains above 6 mb/d in 2030.Libya will continue to increase levels of oil production to 2030, but will struggle to offset the decline in the other countries.Contrary to oil, the demand of which is less elastic, gas demand will much change according to the scenarios: in a scenario of high energy efficiency and deployment of renewable energy sources, demand will increase by 40% while, in a conservative scenario demand could increase by 70%, nearly as much as gas production increases (from 200 bcm in 2010 to 360 bcm in 2030).Demand in the South Mediterranean is expected to increase more rapidly than the North, due also to attractive prices and easy availability
Three countries - Libya, Algeria, and Egypt – hold over 93% of the Mediterranean’s oil and gas reserves.Israel will join the exporters club in the South with a modest contribution.Except for Libya, other South Med countries will be hard-pressed to fulfill their export plans while coping with their fast growing internal demand. This pressure will be particularly hard in the case of Egypt: under a business as usual scenario Egypt could hardly maintain their gas export commitments.Total natural gas exports from these countries could increase from 80 bcm in 2010 to 135-185 bcm in 2030 if the adequate policies for investments and energy saving are implemented.
Coping with electricity demand is one of the major challenges over the two coming decades.Demand will grow at an average growth rate of 2, 8% per year, more rapidly than overall energy demand. In South Mediterranean, however, demand will rise at an average rate of 5% per year and will nearly multiply by three over the considered time period.If at present the North represents 70% of all the electricity demand, the situation will be more balanced by 2030.Under a Proactive scenario, overall electricity demand would be 14% lower. The potential for electricity savings in the next 20 years is of about 3800 TWh, which is all the electricity produced in the South Mediterranean countries for the last ten years
We estimate that 380 additional GW of installed capacity will be needed to cope with electricity demand at the end of the overview period. More than half of this capacity, around 200 GW, in the South.Under a Proactive scenario, more than 60 GW of generation capacity could be avoided.In both scenarios renewable sources will represent important shares of the new capacities: 42% in a conservative scenario and 53% in a Proactive scenario.
The investment required to build up the generation capacities mentioned before will be of 715 billion Euros in one case or 700 billion Euros in the Proactive case.Contrary to the estimation in the North, where the investment required in a Proactive scenario would be lower than in the Conservative scenario, in the South the Proactive option will require an additional investment of around 30 billion Euros. The reason is less gas fired plants and more renewable sources and nuclear.We estimate that the economies of spared gas in power generation and higher gas revenues for exporting countries will compensate for the additional costs of cleaner generation technologies.