Global Trends in Clean Energy and Transportation ZERO Emission Conference Oslo, 7 November PDF Free Download

Global Trends in Clean Energy and Transportation ZERO Emission Conference Oslo, 7 November 218 Michael Liebreich Founder and CEO Liebreich

Clean energy news flow Source: ABC Australia; Independent; Bloomberg, Oilprice.com, Businessgreen; FT; Bloomberg; BBC 1 7 November 218

EV news flow Source: Telegraph; Bloomberg; Economist; Autocar; Wired; New York Times 2 7 November 218

Solar and wind are not taking over the world The great hope for a quick and sweeping transition to renewable energy is wishful thinking. Vaclav Smil Distinguished Professor Emeritus in the Faculty of Environment at the University of Manitoba in Winnipeg, Manitoba, Canada 3 7 November 218 Image: Wikimedia Commons

Global primary energy consumption by fuel 197 217 mtoe 16, mtoe 1% 12, 75% 8, 5% 4, 25% % 197 198 199 2 21 197 198 199 2 21 Coal Oil Gas Nuclear Hydro Non-hydro renewables Source: BP 4 7 November 218

Global new clean energy investment and capacity installations 24 217 175 GW 6 5 4 3 91GW $32bn $35bn $324bn $32bn $363bn $45bn $35 billion $346bn $379bn 2 $228bn $258bn $24bn 1 36GW $95bn $121bn $181bn 24 25 26 27 28 29 21 211 212 213 214 215 216 217 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). Includes large hydro Source: BNEF, IRENA 5 7 November 218

24: Welcome to the Three-Third World 1/3 of electricity will be wind and solar 1/3 of vehicles will be electric Economy will be 1/3 more energy efficient Images: Tesla, Wallpaper Mania, Cleantechnica 6 7 November 218

Wind and solar experience curves Wind /MWh 1, Solar $/W 1 1976 1985 1 28 1 23 1 1 217 Learning rate = 15% Learning rate = 24-28% 1 1, 1, 1, 1,, Cumulative installed capacity (MW) Note: LCOE in real 217.1 217 1 1 1, 1,, Cumulative capacity (MW) Source: BNEF 8 7 November 218

Unsubsidised clean energy world records 211 Solar PV Onshore wind Offshore wind Country: Bidder: Signed: Construction: Spain Various 21 212 US$ 17. c/kwh Note: images are illustrative only Country: Bidder: Signed: Construction: USA Various 21 212 US$ 8. c/kwh Country: Bidder: Signed: Construction: UK SSE 29 211 US$ 17. c/kwh Source: Various manufacturers and project developers 9 7 November 218

Unsubsidised clean energy world records 215 Solar PV Onshore wind Offshore wind Country: Bidder: Signed: Construction: UAE AQWA January 215 217 US$ 5.8 c/kwh Note: images are illustrative only Country: Bidder: Signed: Construction: USA Various 215 216 US$ 4.5 c/kwh Country: Bidder: Signed: Construction: Horns Rev, Denmark Vattenfall Feb 215 217 US$ 12.1 c/kwh Source: Various manufacturers and project developers 1 7 November 218

Unsubsidised clean energy world records 218 Solar PV Onshore wind Offshore wind Country: Bidder: Signed: Construction: Mexico Enel Nov 217 218 US$ 1.97 c/kwh Note: images are illustrative only Country: Bidder: Signed: Construction: Mexico Neoen Nov 217 219 US$ 1.77 c/kwh Country: Bidder: Signed: Construction: Denmark Vattenfall 216 222 US$ 5.3 c/kwh Source: Various manufacturers and project developers 11 7 November 218

Evolution of wind turbine heights and output 3m 13-15 MW 2m 7 MW 9 MW 4 MW 1m 1.2 MW 2 MW 1-12kW.5 MW 19 th C 199 1995 2 25 21 215 225 Sources: Various; Bloomberg New Energy Finance 12 7 November 218

Solar scale-up 25 217 25 218 Images: Nissan; Enel Villanueva solar plant 13 7 November 218

RE proportion of power generation 27 217 Canada 61% 66% 5% UK 33% 14% Germany 36% 15% China 27% Japan 8% US 17% 19% Spain 34% 16% Italy 52% 9% Australia 17% 88% Brazil 81% India 8% 2% Australia Wind & solar Other renewables 2% Note: Calculated as 8% GWh renewable production / GWh consumption 18% 19% Source: Liebreich ; BNEF; BP 14 7 November 218

Global off-grid renewable energy users 27 216 million people 16 12 Biogas mini-grids Solar mini-grids 8 Hydro mini-grids Solar home systems 4 Solar lights 27 28 29 21 211 212 213 214 215 216 15 7 November 218 Source: IRENA

Coal 16 7 November 218 Image: Wikimedia Commons

Coal price crash Goldman Sachs! JP Morgan! The Massachusetts Pension Fund! Your coal investments took a hell of a beating! Bjørge Lillelien Broadcaster and commentator (with apologies) 17 7 November 218 Picture: NRK Sport

Coal market performance 218 $/tonne 2 8 15 1 5 6 4 2 Richards Bay Richards Bay ARA ARA Newcastle Dow Newcastle Jones US Coal Index 27 28 29 21 211 212 213 214 215 216 217 218 18 7 November 218 Source: Bloomberg; Liebreich

Coal has more or less peaked Coal production Mt/yr 6, 5, 4, 3, 2, 1, Coal consumption Mt/yr 6, 5, 4, 3, 2, 1, 199 1995 2 25 21 215 199 1995 2 25 21 215 North America S. & Central America Europe Eurasia Africa APAC Note: Adjusted to standard coal equivalent Source: Liebreich ; BP Statistical Review 19 7 November 218

Coal capacity factors, selected countries US India South Africa Australia China Indonesia 1 11 12 13 14 15 16 17 1 11 12 13 14 15 16 17 1 11 12 13 14 15 16 17 1 11 12 13 14 15 16 17 1 11 12 13 14 15 16 17 1 11 12 13 14 15 16 17 Notes: Based on end-of-year capacity figures; 217 is estimated Source: BNEF, IEA, EIA, India CEA, NERSA, Australia DOWS 2 7 November 218

UK coal consumption 185 23 Million tonnes 25 2 15 1 5 BNEF NEO 218 forecast 185 186 187 188 189 19 191 192 193 194 195 196 197 198 199 2 21 22 23 Source: BEIS, Prof. David Rutledge, BNEF; Liebreich 21 7 November 218

UK vs Germany generation mix 2 217 UK TWh 8 231 gco2/kwh (295 gco2/kwh incl. biomass) Germany TWh 8 534 gco2/kwh (57 gco2/kwh incl. biomass) 6 6 4 4 2 2 2 25 21 215 217 2 25 21 215 217 Renewable Nuclear Gas Coal Domestic demand Source: Liebreich ; DUKES; AG Energiebilanzen 22 7 November 218

Hambach lignite mine, Northern Germany Before After 23 7 November 218 Images: Wikimedia Commons

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 24 7 November 218 Image: Twitter

Coal consumption NEO 216 Coal consumption EMEA and AMER Mt/yr 4, Coal consumption in ASOC Mt/yr 4, 3, 3, 216 2, 2, 1, 216 1, 2 21 22 23 24 2 21 22 23 24 Source: BNEF; IEA; Liebreich 25 7 November 218

Coal consumption NEO 216 217 Coal consumption EMEA and AMER Mt/yr 4, Coal consumption in ASOC Mt/yr 4, 3, 2, 3, 2, 216 217 1, 217 216 1, 2 21 22 23 24 2 21 22 23 24 Source: BNEF; IEA; Liebreich 26 7 November 218

Coal consumption NEO 216 218 Coal consumption EMEA and AMER Mt/yr 4, Coal consumption in ASOC Mt/yr 4, 3, 2, 3, 2, 216 217 218 1, 2 21 22 23 24 217 216 218 1, 2 21 22 23 24 Source: BNEF; IEA; Liebreich 27 7 November 218

Meanwhile in Australia This is coal - don't be afraid, don't be scared! Scott Morrison Prime Minister of Australia 28 7 November 218 Image: Bloomberg

US coal 29 7 November 218 Image: Bloomberg

President Trump on US coal July 217 We picked up 45, mining jobs in a very short period of time. Everybody was saying, well, you won t get any mining jobs. We picked up 45, mining jobs Donald Trump US President 3 7 November 218 Image: Mark Lyons/Getty Images

US coal mining monthly employment Jan 1995 Aug 218 Thousand employees 15 President Clinton President GW Bush President Obama President Trump 1 5 1995 2 25 21 215 Source: U.S. Bureau of Labor Statistics 31 7 November 218

8 Evolving structure of power supply Germany Past winter 8 Current winter 8 Future winter 6 6 6 4 4 4 2 2 2-2 -2-2 -4 Monday Tuesday Wednesday Thursday Friday Saturday Sunday -4 Monday Tuesday Wednesday Thursday Friday Saturday Sunday -4 Monday Tuesday Wednesday Thursday Friday Saturday Sunday 8 Past summer 8 Current summer 8 Future summer 6 6 6 4 4 4 2 2 2-2 -2-2 -4-4 -4 Monday Tuesday Wednesday Thursday Friday Saturday Sunday Monday Tuesday Wednesday Thursday Friday Saturday Sunday Monday Tuesday Wednesday Thursday Friday Saturday Sunday Peaking fossil Baseload fossil Nuclear CHP Hydro Baseload RE Solar Wind Pumped hydro generation/storage Imports Exports/curtailment/DR Source: BNEF 32 7 November 218

Evolving structure of power supply California First week of May 212 (actual) First week of May 217 (actual) First week of May 23 (modelled) Solar Wind Net Load Demand Source: CAISO OASIS; CPUC; LS Power; CESA; BNEF 33 7 November 218

Gas 34 7 November 218 Image: FN LNG Alliance

LNG export capacity by country/region MMtpa 7 6 5 4 3 2 1 21 212 214 216 218 22 222 224 226 228 23 Unlikely West Africa West Africa Russia Russia Australia Australia East Africa East Africa Qatar Qatar North America North America Russia Russia North America Australia North America Other Australia West Other Africa North West Africa Africa Indonesia North Africa Malaysia Indonesia Qatar Malaysia Demand Qatar Demand Pre-FID Operational, under construction or post-fid Note: Pre-final investment decision projects with <5% chance of success are included under unlikely Source: BNEF 35 7 November 218

LNG export capacity by country/region MMtpa 7 6 5 4 3 2 1 21 212 214 216 218 22 222 224 226 228 23 Unlikely West Africa Russia Australia East Africa Qatar North America Russia North America Australia Other West Africa North Africa Indonesia Malaysia Qatar Demand Pre-FID Operational, under construction or post-fid Note: Pre-final investment decision projects with <5% chance of success are included under unlikely Source: BNEF 36 7 November 218

Balancing the grid Interconnectors Pumped storage Demand response Electric vehicles Batteries Months to weeks Days to hours Minutes to seconds I. PLANNING FOR EXTREMES Digitisation III. CONTROLLING FREQUENCY Demand H2 II. CONTINUOUS BALANCING Variable supply Flow batteries Power to gas Seasonal thermal storage Smart heating & cooling Flywheels Ammonia Biomass/bio gas Biofuel Source: BNEF Solar CSP Gravity systems Compressed air 37 7 November 218

Digitisation of infrastructure Ubiquitous chips and sensors Ubiquitous communications Ubiquitous processing and storage (cloud to network edge) Ubiquitous Artificial intelligence and machine learning Ubiquitous Blockchain (distributed ledgers and smart contracts) 38 7 November 218 Source: BNEF; Liebreich

Electric vehicles Image: Tesla 41 7 November 218

Quarterly EV sales by region Q1 212 Q2 218 APAC EMEA AMER thousand sold 3 thousand sold 3 thousand sold 3 2 2 2 1 CAGR 79% CAGR 63% CAGR 34% 1 1 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 212 213 214 215 216 217 18 42 7 November 218 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 212 213 214 215 216 217 18 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 212 213 214 215 216 217 18 Source: BNEF

Battery pack costs to fall another 7% by 23 $/kwh 1, 8 Unsubsidised TCO crossover with ICEs 217 224 Unsubsidised sticker price crossover with ICEs 225 23 6 Observed price 4 $96/kWh $7/kWh 18% learning rate 2 21 215 22 225 23 Source: BNEF EVO 218 43 7 November 218

BEV model availability, 22 SUVs/Trucks Sports cars Sedans Hatchbacks Runabouts Small vans Land Rover Defender 44 7 November 218 Mahindra everito SAIC E-Lavida CODA EV Toyota RAV4 Fiat 5e Mitsubishi i-miev BYD e6 Venturi Fetish Honda Clarity BAIC EU26 JAC iev4 Renault Fluence BYD e5 Kia Ray Hyundai BMW i3 BlueOn M-B E-Cell VW e-golf Chevy Spark Honda Fit Ford Focus Nissan Leaf Renault Zoe ZE BMW mini e Kandi Panda Smart Renault Twizy ForTwo Nissan env2 Tata IRIS Smith Edison Zenith Electric Van Peugeot Partner M-B B-Class Renault DeZir Hyundai Ioniq ChangAn Eado M-B Vito Trumpchi GS4 Qianto Q5 M-B SLS edrive VW e-up Seat Mii* Mahindra e2o Bollore Bluesummer BYD T3 VW Budd-e Geely Emgrand BD educato Aston Martin RapidE Mullen 7e ChangAn EM8 Renault Kangoo Jaguar I-Pace Mitsubishi ex Tesla Model Y* NIO ES8* Tesla Roadster Tesla Model S GLM G4 NIO EP9 Exagon Furtive Tesla Model 3 VW e-bulli Chevy Bolt Audi E-tron Sportback Nissan Leaf 2* Tesla VW I.D.* pickup* BMW i5 Tesla Model X Chehejia SUV* 5 1 15 2 25 3 35 VW I.D. LeEco LeSEE VW I.D. CROZZ M-B EQ Audi E-tron Quattro Porsche E-sport Tesla Roadster* Audi R8 E-tron NIO EVE Lucid Air Faraday FF91 VW I.D. BUZZ Volvo 4.2* + Source: Bloomberg New Energy Finance, Images various. Notes: Not exhaustive. (*) Range is speculated

BNEF electric vehicle outlook to 24 Annual global light duty vehicle sales million vehicles 12 Global light duty vehicle fleet million vehicles on road 2, 9 55% 1,5 6 28% 1, 33% 3 3% 215 22 225 23 235 24 215 23 22 235 225 24 23 235 24 PHEV BEV ICE All EVs % of sales All EVs % of fleet 5 1% 9% Source: BNEF EVO 218 45 7 November 218

Not just cars going electric buses Images: Tesla; Starship Technologies; Ehang; Zunum; Daimler; Dpost; UPS/Arrival 46 7 November 218

Not just cars going electric commercial vehicles Images: Tesla; Starship Technologies; Ehang; Zunum; Daimler; Dpost; UPS/Arrival 47 7 November 218

Not just cars going electric ships 48 7 November 218 Images: Alf Kare Aesobo; Kongsberg; Enercon

Not just cars going electric Images: Pipistrel; Ehang; Lilium; Airbus; Zunum; NASA 49 7 November 218

Hydrogen vehicles Toyota Mirai Nikola Tre 5 7 November 218 Images: Nikola Motors; Toyota

BEV and H2FC efficiencies compared BEV Wind-to-wheel efficiency 61% FCV Wind-to-wheel efficiency 32% 51 7 November 218 Source: Bloomberg New Energy Finance

Global BEV vs. FCV sales Battery electric vehicles Thousand units 5 4 3 2 1 Fuel cell vehicles Thousand units 5 4 3 2 1 Q1 214 Q1 215 Q1 216 Q1 217 Q1 218 Q1 214 Q1 215 Q1 216 Q1 217 Q1 218 Source: BNEF 52 7 November 218

Global EV charging and Hydrogen fuelling infrastructure EV charging points Thousand outlets 6 Hydrogen fuelling stations Thousand stations 6 4 4 2 2 212 213 214 215 216 217 212 213 214 215 216 217 China Europe U.S. Others Japan 53 7 November 218 Source: Liebreich

Oil 54 7 November 218 Image: Stormgeo

IEA oil supply forecast million barrels per day 13 12 11 1 9 8 7 6 199 1995 2 25 21 215 22 225 23 235 24 Notes: 1996 Capacity Constraints and Energy Savings, 1998 BAU, 22-29 Reference, 21-217 New Policies Scenario Historical WEO 1994 WEO 1996 WEO 1996 WEO 1998 WEO 22 WEO 23 WEO 26 WEO 27 WEO 29 WEO 21 WEO 211 WEO 212 WEO 214 WEO 215 WEO 216 WEO 217 Source: IEA WEO 55 7 November 218

IEA oil supply forecast million barrels per day 13 12 Pre-2 11 1 9 8 7 6 199 1995 2 25 21 215 22 225 23 235 24 Notes: 1996 Capacity Constraints and Energy Savings, 1998 BAU, 22-29 Reference, 21-217 New Policies Scenario Historical WEO 1994 WEO 1996 WEO 1996 WEO 1998 WEO 1996 WEO 22 WEO 23 WEO 26 WEO 1996 27 WEO 29 WEO 21 WEO 211 WEO 1998 WEO 212 WEO 214 WEO 215 Historical WEO 216 WEO 217 Source: IEA WEO 56 7 November 218

IEA oil supply forecast million barrels per day 13 12 2-27 Pre-2 11 1 9 8 7 6 199 1995 2 25 21 215 22 225 23 235 24 Notes: 1996 Capacity Constraints and Energy Savings, 1998 BAU, 22-29 Reference, 21-217 New Policies Scenario Historical WEO 1994 WEO 1994 WEO WEO 1996 1996 WEO 1996 WEO 1996 1998 WEO 22 WEO 1998 23 WEO 26 WEO 22 27 WEO 29 WEO 23 21 WEO 211 WEO WEO 26 212 WEO 214 WEO 27 WEO 215 WEO 216 Historical WEO 217 Source: IEA WEO 57 7 November 218

IEA oil supply forecast million barrels per day Historical WEO 1994 13 WEO 1994 1996 2-27 WEO 1996 Pre-2 12 WEO 1996 1998 WEO 1998 22 11 WEO 22 23 WEO 23 26 1 WEO 26 27 WEO 27 29 21-217 9 WEO 29 21 Transformation WEO 21 211 8 scenario? WEO 211 212 WEO 212 214 7 WEO 214 215 WEO 215 216 6 199 1995 2 25 21 215 22 225 23 235 24 WEO 216 217 WEO Historical 217 Notes: 1996 Capacity Constraints and Energy Savings, 1998 BAU, 22-29 Reference, 21-217 New Policies Scenario Source: IEA WEO 58 7 November 218

European oil majors power sector moves, 211 218 Technology Generation Trading and retailing EV charging 59 7 November 218 Source: BNEF; Companies

World GDP, final energy and energy intensity by 24 Indexed (216 = 1) 25 2 15 The world uses a third less energy per unit of GDP by 24 1 5 Note: Using IEA New Policies Scenario GDP Final energy Final energy/gdp 216 24 Source: Liebreich ; IEA 62 7 November 218

Innovation in heat is cool Images: Naked Energy; Climeon; Danfoss; SaltX; Sonnen; Radbot; Optiwatt; PassivSystems; Sunamp; Solidpower 63 7 November 218

Paris The world must achieve greenhouse gas neutrality some time in the second half of the century Paris Agreement December 215 65 7 November 218 Image: UNFCCC

Are we decarbonising the global energy system fast enough? Emissions intensity of power generation Electricity share in final energy gco2/mwh.8 Historical trend leads to decarbonised power by 2168 8%.6.4.2 BNEF trend leads to decarbonised electricity in 274 6% 4% 2% All trends suggest it will take 41 years to fully electrify the global energy system. % 199 2 21 22 23 24 25 199 2 21 22 23 24 25 Historic Historic extrapolated BNEF NEO 218 Source: BNEF NEO 218; IEA WEO 217; Liebreich 66 7 November 218

Beyond the Three-Third World Shipping/air/freight Manufacturing Chemicals Agriculture Heat Energy access Images: Bloomberg New Energy Finance, Tesla, Wallpaper Mania, Cleantechnica; Wikipedia Commons 67 7 November 218

Thanks! michael@liebreichassociates.com www.liebreich.com 68 7 November 218

Global Trends in Clean Energy and Transportation ZERO Emission Conference Oslo, 7 November 2018