World Energy Investment 2017

Transcription

1 World Energy Investment 217 Economics and Investment Office IEA OECD/IEA 217

2 USD (216) billion Global energy investment fell 12% in 216, a second consecutive year of decline % Networks Global energy investment % Coal 25 Renewable Oil & gas +9% -25% Thermal Electricity Oil, gas & coal Energy efficiency Renewables in transport and heat Electricity sector investment overtook oil and gas for the first time

3 USD (216) billion Global clean energy R&D funding needs a strong boost Global clean energy R&D spending Top 3 IT company R&D spenders Private Public Global R&D spending on clean energy plateaued at $26 billion/year, with much room for growth from the private sector. As a share of GDP, China's leads spending on energy R&D, after overtaking Japan

4 Jobs/TWh/Year Job needs of power generation technologies Employment associated with 1TWh of new generation in Indian coal vs Australian coal Australian LNG vs Domestic conventional gas 1 Solar PV (residential) Onshore wind Hydro Solar PV (utility) Nuclear Gas-fired Coal-fired Construction Manufacturing O&M Fuel supply Residential solar PV and coal-fired generation are most labour-intensive while regional differences can be significant.

5 Appliance standards lock in electricity end use efficiency Electricity demand shows similar stagnation in the US and Europe despite very different end user prices

6 Wind and solar costs continue to plummet Wind and solar PV average LCOEs and auction results by commissioning date USD 216/MWh Onshore wind average auction price Solar PV average auction price 1 Solar PV - utility scale LCOE 5 Onshore wind LCOE Competitive auctions combine technology incentives with ultra low cost of capital

7 The so called decentralised renewables All of wind and the large majority of solar deployment relies on an interconnected network

8 USD (216) billion Smarter networks are the key to address flexibility gaps Investment in digital grid infrastructure and total electricity networks spending Physical backbone Power equipment Smart meters Smart grid infrastructure EV chargers Networks spending is dominated by lines and power equipment, but digital grid infrastructure now accounts for over 1% of networks investment.

9 Digitalization, decarbonisation and electrification EVs standard vs smart charging Capacity Curtailment requirement of solar PV and wind 7% 3 Digital GW flexibility 14 GW 19 GW 75 GW 15 million EVs 5 million EVs 24 Standard charging Smart charging Digitalization unlocks flexibility to facilitate renewable integration and turn EVs into flexible grid assets

10 The headwind of the hydro and nuclear slowdown TWh Future production from capacity receiving FID 2 Wind and solar 1 Nuclear and hydro New low carbon investment covers only around half of the global electricity demand increase

11 GW A wave of coal power investment is coming to a pause Average annual final investment decisions for new coal-fired power capacity China India Southeast Asia Rest of world In 216 the sanctioning of new coal power fell to the lowest level in nearly 15 years, hampered by competition from renewables and environmental challenges. Gas power FIDs surpassed coal for only the second time in the past decade.

12 GW Gas capacity: coming back from the brink? Retirements Final investment decisions Compressed load factors, low wholesale prices and market design uncertainty disrupted the investment model of gas plants

13 TWh Thousand units Electrification of transport and heat is progressing Electricity demand from new heat pumps sold Global electric vehicle sales Electric vehicle (EV) sales grew 38% in 216 and, at $6 billion, now represent 1% of all transport efficiency spending. Another $6 billion was spent globally on EV charging stations.

14 Cheap oil shifts consumer preferences towards big cars The three best selling vehicles in North America

15 USD billion (nominal) Global upstream investment rebounds modestly in % Global oil and gas upstream capital spending % 38% 38% 37% -26% +6% 39% 42% 42% 27% 27% 44% 45% 28% 29% 25% 28% 18% 19% 2% 21% 2% 26% 25% 21% 19% 17% 12% 14% 14% 14% 16% 12% 1% 13% US independents Global Cost Index (Right Majors axis) Other Shale private Cost Index (Right axis) NOCs Ramp up of activities leads to cost inflation in US tight oil but elsewhere upstream costs decline further. NOC share in total investment reaches another record high.

16 US shale: a digitalization and technology success 3D seismic data for geologic modelling Multi-well pad drilling Walking rig New chemical agents to reduce the use of sand Longer lateral Tighter spacing Fracture design and evaluation software Improved robotics Sources: original image from the Texas Tribune

17 Russia: drivers of investment resilience West Siberia brownfield: domestic service capabilities, costs are in rouble Power of Siberia: Strong project management expertise with pipelines, Made in Russia components Yamal LNG: Chinese equity and project finance, EU and Japanese technology providers Russian oil production stabilized at a level.6 mb/day higher than 214 expectations

18 Time to market (years) Conventional oil and gas projects becoming faster and smaller Average size of conventional resources sanctioned and time-to-market Other offshore Global Average Deepwater offshore Onshore Average size of resources (Million Boe) A shift in company strategies and technology developments leads to shorter project cycles across all the oil and gas industry

19 USD (215) billion bcm per year LNG investment: past the peak? Investment into LNG export facilities Australia Africa Middle East North America Russia Europe Others Right axis: Capacity Lack of FIDs since 215 indicate a rapid decline of investment

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