energy
[r]evolution
A SUSTAINABLE GLOBAL ENERGY OUTLOOK

foreword

Of all the sectors of a modern economic system, the one that appears to be getting the maximum attention currently is the energy sector. While the recent increase in oil prices certainly requires some temporary measures to tide over the problem of increasing costs of oil consumption particularly for oil importing countries, there are several reasons why the focus must now shift towards longer term solutions. First and

foremost, of course, are the growing uncertainties related to oil imports both in respect of quantities and prices, but there are several other factors that require a totally new approach to planning energy supply and consumption in the future. Perhaps, the most crucial of these considerations is the threat of global climate change which has been caused overwhelmingly in recent decades by human actions that have resulted in the build up of greenhouse gases (GHGs) in the Earth's atmosphere.

Impacts of climate change are diverse and serious, and unless the emissions of GHGs are effectively mitigated these would threaten to become far more serious over time. There is now, therefore, a renewed interest in renewable sources of energy, because by creating and using low carbon substitutes to fossil fuels, we may be able to reduce emissions of GHGs significantly while at the same time ensuring economic growth and development and the enhancement of human welfare across the world. As it happens, there are major disparities in the levels of consumption of energy across the world, with some countries using large quantities per capita and others being deprived of any sources of modern energy forms. Solutions in the future would, therefore, also have to come to grips with the reality of lack of access to modern forms of energy for hundreds of millions of people. For instance, there are 1.6 billion people in the world who have no access to electricity. Households, in which these people reside, therefore, lack a single electric bulb for lighting purposes, and whatever substitutes they use provide inadequate lighting and environmental pollution, since these include inefficient lighting devices using various types of oil or the burning of candles.

Future policies can be guided by the consideration of different scenarios that can be linked to specific developments. This publication advocates the need for something in the nature of an energy revolution. This is a view that is now shared by several people across the world, and it is also expected that energy plans would be based on a clear assessment of specific scenarios related to clearly identified policy initiatives and technological developments. This edition of Energy [R]evolution Scenarios provides a detailed analysis of the energy efficiency potential and choices in the transport sector. The material presented in this publication provides a useful basis for considering specific policies and developments that would be of value not only to the world but for different countries as they attempt to meet the global challenge confronting them. The work carried out in the following pages is comprehensive and rigorous, and even those who may not agree with the analysis presented would, perhaps, benefit from a deep study of the underlying assumptions that are linked with specific energy scenarios for the future.
Dr. R. K. Pachauri DIRECTOR-GENERAL, THE ENERGY AND RESOURCES INSTITUTE (TERI) AND CHAIRMAN, INTERGOVERNMENTAL PANEL ON CLIMATE CHANGE (IPCC) OCTOBER 2008


GLOBAL ENERGY [R]EVOLUTION A SUSTAINABLE GLOBAL ENERGY OUTLOOK
introduction
"NOW IS THE TIME TO COMMIT TO A TRULY SECURE AND SUSTAINABLE ENERGY FUTURE ­ A FUTURE BUILT ON CLEAN TECHNOLOGIES, ECONOMIC DEVELOPMENT AND THE CREATION OF MILLIONS OF NEW JOBS."



Energy supply has become a subject of major universal concern. High and volatile oil and gas prices, threats to a secure and stable supply and not least climate change have all pushed it high up the international agenda. In order to avoid dangerous climate change, global CO2 emissions must peak no later than 2015 and rapidly decrease after that. The technology to do this is available. The renewables industry is ready for take off and opinion polls show that the majority of people support this move. There are no real technical obstacles in the way of an Energy [R]evolution, all that is missing is political support. But we have no time to waste. To achieve an emissions peak by 2015 and a net reduction afterwards, we need to start rebuilding the energy sector now.

An overwhelming consensus of scientific opinion now agrees that climate change is happening, is caused in large part by human activities (such as burning fossil fuels), and if left unchecked will have disastrous consequences. Furthermore, there is solid scientific evidence that we should act now. This is reflected in the conclusions, published in 2007, of the Intergovernmental Panel on Climate Change (IPCC), a UN institution of more than 1,000 scientists providing advice to policy makers.
The effects of climate change have in fact already begun. In 2008, the melting of the Arctic ice sheet almost matched the record set on September 16, 2007. The fact that this has now happened two years in a row reinforces the strong decreasing trend in the amount of summertime ice observed over the past 30 years.

"renewable energy, combined with the smart use of energy, can deliver half of the world's energy needs by 2050."

image ICEBERG MELTING ON GREENLAND'S COAST.

In response to this threat, the Kyoto Protocol has committed its signatories to reduce their greenhouse gas emissions by 5.2% from their 1990 levels by 2008-2012. The Kyoto signatories are currently negotiating the second phase of the agreement, covering the period from 2013-2017. Time is quickly running out. Signatory countries agreed a negotiating `mandate', known as the Bali Action Plan, which they must complete with a final agreement on the second Kyoto commitment period by the end of 2009. By choosing renewable energy and energy efficiency, developing countries can virtually stabilise their CO2 emissions, whilst at the same time increasing energy consumption through economic growth. OECD countries, on the other hand, will have to reduce their emissions by up to 80%. The Energy [R]evolution concept provides a practical blueprint on how to put this into practice.
Renewable energy, combined with the smart use of energy, can deliver at least half of the world's energy needs by 2050. This report, `Energy [R]evolution: A Sustainable World Energy Outlook', shows that it is economically beneficial to cut global CO2 emissions by over 50% within the next 42 years. It also concludes that a massive uptake of renewable energy sources is technically and economically possible. Wind power alone could produce about 40 times more power than it does today, and total global renewable energy generation could quadruple by then.
renewed energy [r]evolution
This is the second edition of the Energy [R]evolution. Since we published the first edition in January 2007, we have experienced an overwhelming wave of support from governments, the renewables industry and non-governmental organisations. Since than we have broken down the global regional scenarios into country specific plans for Canada, the USA, Brazil, the European Community, Japan and Australia, among many others.
More and more countries are seeing the environmental and economic benefits provided by renewable energy. The Brent crude oil price was at $55 per barrel when we launched the first Energy [R]evolution report. Since than the price has only headed in one direction - upwards! By mid-2008 it had reached a peak of over $140 per barrel and has subsequently stabilised at around $100. Other fuel prices have also shot up. Coal, gas and uranium have doubled or even tripled in the same timeframe. By contrast, most renewable energy sources don't need any fuel. Once installed, they deliver energy independently from the global energy markets and at predictable prices. Every day that another community switches to renewable energy is an independence day.
The Energy [R]evolution Scenario concludes that the restructuring of the global electricity sector requires an investment of $14.7 trillion up to 2030. This compares with $11.3 trillion under the Reference Scenario based on International Energy Agency projections. While the average annual investment required to implement the Energy [R]evolution Scenario would need just under 1% of global GDP, it would lower fuel costs by 25% - saving an annual amount in the range of $750 billion.

In fact, the additional costs for coal power generation alone from today up to 2030 under the Reference Scenario could be as high as US$ 15.9 billion: this would cover the entire investment needed in renewable and cogeneration capacity to implement the Energy [R]evolution Scenario. These renewable sources will produce energy without any further fuel costs beyond 2030, while the costs for coal and gas will continue to be a burden on national and global economies.
global energy scenario
The European Renewable Energy Council (EREC) and Greenpeace International have produced this global energy scenario as a practical blueprint for how to urgently meet CO2 reduction targets and secure an affordable energy supply on the basis of steady worldwide economic development. Both of these goals are possible at the same time. The urgent need for change in the energy sector means that this scenario is based only on proven and sustainable technologies, such as renewable energy sources and efficient decentralised cogeneration. It therefore excludes so-called `CO2-free coal power plants', which are not in fact CO2 free and would create another burden in trying to store the gas under the surface of the Earth with unknown consequences. For multiple safety and environmental reasons, nuclear energy is also excluded.
Commissioned from the Department of Systems Analysis and Technology Assessment (Institute of Technical Thermodynamics) at the German Aerospace Centre (DLR), the report develops a global sustainable energy pathway up to 2050. The future potential for renewable energy sources has been assessed with input from all sectors of the renewables industry around the world. The new Energy [R]evolution Scenario also takes a closer look for the first time at the transport sector, including future technologies and how to implement energy efficiency.
The energy supply scenarios adopted in this report, which extend beyond and enhance projections made by the International Energy Agency, have been calculated using the MESAP/PlaNet simulation model. The demand side projection has been developed by the Ecofys consultancy to take into account the future potential for energy efficiency measures. This study envisages an ambitious development pathway for the exploitation of energy efficiency potential, focused on current best practice as well as technologies available in the future. The result is that under the Energy [R]evolution Scenario, worldwide final energy demand can be reduced by 38% in 2050 compared to the Reference Scenario.


GLOBAL ENERGY [R]EVOLUTION A SUSTAINABLE GLOBAL ENERGY OUTLOOK

image THE PS10 CONCENTRATING SOLAR TOWER PLANT IN SEVILLA, SPAIN, USES 624 LARGE MOVABLE MIRRORS CALLED HELIOSTATS. THE MIRRORS CONCENTRATE THE SUN'S RAYS TO THE TOP OF A 115 METER (377 FOOT) HIGH TOWER WHERE A SOLAR RECEIVER AND A STEAM TURBINE ARE LOCATED. THE TURBINE DRIVES A GENERATOR, PRODUCING ELECTRICITY.

the potential for renewable energy
The good news is that the global market for renewables is booming. Decades of technical progress have seen renewable energy technologies such as wind turbines, solar photovoltaic panels, biomass power plants, solar thermal collectors and many others move steadily into the mainstream. The global market for renewable energy is growing dramatically; in 2007 its turnover was over aUS$ 70 billion, almost twice as high as the previous year. The time window for making the shift from fossil fuels to renewable energy, however, is still relatively short. Within the next decade many of the existing power plants in the OECD countries will come to the end of their technical lifetime and will need to be replaced. But a decision taken to construct a coal or gas power plant today will result in the production of CO2 emissions and dependency on the resource and its future costs lasting until 2050.
The power industry and utilities need to take more responsibility because today's investment decisions will define the energy supply of the next generation. We strongly believe that this should be the `solar generation'. Politicians from the industrialised world urgently need to rethink their energy strategy, while the developing world should learn from past mistakes and build economies on the strong foundations of a sustainable energy supply.
Renewable energy could more than double its share of the world's energy supply - reaching up to 30% by 2030. All that is lacking is the political will to promote its large scale deployment in all sectors at a global level, coupled with far reaching energy efficiency measures. By 2030 about half of global electricity could come from renewable energies.
The future of renewable energy development will strongly depend on political choices made by both individual governments and the international community. At the same time strict technical standards will ensure that only the most efficient fridges, heating systems, computers and vehicles will be on sale. Consumers have a right to buy products that don't increase their energy bills and won't destroy the climate.
In this report we have also expanded the time horizon for the Energy [R]evolution concept beyond 2050, to see when we could phase out fossil fuels entirely. Once the pathway of this scenario has been implemented, renewable energy could provide all global energy needs by 2090. A more radical scenario ­ which takes the advanced projections of the renewables industry into account ­ could even phase out coal by 2050. Dangerous climate change might force us to accelerate the development of renewables faster. We believe that this would be possible, but to achieve it more resources must go into research and development. Climate change and scarcity of fossil fuel resources puts our world as we know it at risk; we must start to think the unthinkable. To tap into the fast potential for renewables and to phase out fossil fuels as soon as possible are amongst the most pressing tasks for the next generation of engineers and scientists.

implementing the energy [r]evolution
Business as usual is not an option for future generations. The Reference Scenario based on the IEA's `World Energy Outlook 2007' projection would almost double global CO2 emissions by 2050 and the climate would heat up by well over 2°C. This would have catastrophic consequences for the environment, the economy and human society. In addition, it is worth remembering that the former chief economist of the World Bank, Sir Nicholas Stern, pointed out clearly in his landmark report that the countries which invest in energy saving technologies and renewable energies today will be the economic winners of tomorrow.
As Stern emphasised, inaction will be much more expensive in the long run. We therefore call on all decision makers yet again to make this vision a reality. The world cannot afford to stick to the `business as usual' energy development path: relying on fossil fuels, nuclear energy and other outdated technologies. Renewable energy can and will play a leading role in our collective energy future. For the sake of a sound environment, political stability and thriving economies, now is the time to commit to a truly secure and sustainable energy future ­ a future built on clean technologies, economic development and the creation of millions of new jobs.

Arthouros Zervos EUROPEAN RENEWABLE ENERGY COUNCIL (EREC) OCTOBER 2008

Sven Teske CLIMATE & ENERGY UNIT GREENPEACE INTERNATIONAL

"by 2030 about half of global electricity could come from renewable energies."

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executive summary
"NOW IS THE TIME TO COMMIT TO A TRULY SECURE AND SUSTAINABLE ENERGY FUTURE ­ A FUTURE BUILT ON CLEAN TECHNOLOGIES, ECONOMIC DEVELOPMENT AND THE CREATION OF MILLIONS OF NEW JOBS."

climate threats and climate solutions
Global climate change caused by the relentless build-up of greenhouse gases in the Earth's atmosphere is already disrupting ecosystems, resulting in about 150,000 additional deaths each year. An average global warming of 2°C threatens millions of people with an increased risk of hunger, malaria, flooding and water shortages. If rising temperatures are to be kept within acceptable limits then we need to significantly reduce our greenhouse gas emissions. This makes both environmental and economic sense. The main greenhouse gas is carbon dioxide (CO2) produced by using fossil fuels for energy and transport.

climate change and security of supply
Spurred by recent large increases in the price of oil, the issue of security of supply is now at the top of the energy policy agenda. One reason for these price increases is the fact that supplies of all fossil fuels ­ oil, gas and coal ­ are becoming scarcer and more expensive to produce. The days of `cheap oil and gas' are coming to an end. Uranium, the fuel for nuclear power, is also a finite resource. By contrast, the reserves of renewable energy that are technically accessible globally are large enough to provide about six times more power than the world currently consumes - forever.
Renewable energy technologies vary widely in their technical and economic maturity, but there are a range of sources which offer increasingly attractive options. These include wind, biomass, photovoltaic, solar thermal, geothermal, ocean and hydroelectric power. Their common feature is that they produce little or no greenhouse gases, and rely on virtually inexhaustible natural sources for their `fuel'. Some of these technologies are already competitive. Their economics will further improve as they develop technically, as the price of fossil fuels continues to rise and as their saving of carbon dioxide emissions is given a monetary value.

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GLOBAL ENERGY [R]EVOLUTION A SUSTAINABLE GLOBAL ENERGY OUTLOOK


At the same time there is enormous potential for reducing our consumption of energy, while providing the same level of energy services. This study details a series of energy efficiency measures which together can substantially reduce demand in industry, homes, business and services.
Although nuclear power produces little carbon dioxide, there are multiple threats to people and the environment from its operations. These include the risks and environmental damage from uranium mining, processing and transport, the risk of nuclear weapons proliferation, the unsolved problem of nuclear waste and the potential hazard of a serious accident. The nuclear option is therefore discounted in this analysis. The solution to our future energy needs lies instead in greater use of renewable energy sources for both heat and power.
the energy [r]evolution
The climate change imperative demands nothing short of an energy revolution. At the core of this revolution will be a change in the way that energy is produced, distributed and consumed.
the five key principles behind this shift will be to:
· Implement renewable solutions, especially through decentralised energy systems
· Respect the natural limits of the environment
· Phase out dirty, unsustainable energy sources
· Create greater equity in the use of resources
· Decouple economic growth from the consumption of fossil fuels
Decentralised energy systems, where power and heat are produced close to the point of final use, avoid the current waste of energy during conversion and distribution. They will be central to the Energy [R]evolution, as will the need to provide electricity to the two billion people around the world to whom access is presently denied.
Two scenarios up to the year 2050 are outlined in this report. The Reference Scenario is based on the Reference Scenario published by the International Energy Agency in World Energy Outlook 2007, extrapolated forward from 2030. Compared to the 2004 IEA projections, World Energy Outlook 2007 (WEO 2007) assumes a slightly higher average annual growth rate of world Gross Domestic Product (GDP) of 3.6%, instead of 3.2%, over the period 20052030. At the same time, WEO 2007 expects final energy consumption in 2030 to be 4% higher than in WEO 2004.
China and India are expected to grow faster than other regions, followed by the Developing Asia group of countries, Africa and the Transition Economies (mainly the former Soviet Union). The OECD share of global purchasing power parity (PPP) adjusted GDP will decrease from 55% in 2005 to 29% by 2050.
The Energy [R]evolution Scenario has a target for worldwide carbon dioxide emissions to be reduced by 50% below 1990 levels by 2050, with per capita emissions reduced to less than 1.3 tonnes per year. This is necessary if the increase in global temperature is to

remain below +2°C. A second objective is the global phasing out of nuclear energy. To achieve these targets, the scenario is characterised by significant efforts to fully exploit the large potential for energy efficiency. At the same time, all cost-effective renewable energy sources are accessed for both heat and electricity generation, as well as the production of sustainable bio fuels.
Today, renewable energy sources account for 13% of the world's primary energy demand. Biomass, which is mostly used in the heat sector, is the main renewable energy source. The share of renewable energies for electricity generation is 18%. The contribution of renewables to heat supply is around 24%, to a large extent accounted for by traditional uses such as collected firewood. About 80% of the primary energy supply today still comes from fossil fuels. The Energy [R]evolution Scenario describes a development pathway which turns the present situation into a sustainable energy supply through the following measures:
· Exploitation of the existing large energy efficiency potentials will ensure that primary energy demand increases only slightly - from the current 474,900 PJ/a (2005) to 480,860 PJ/a in 2050, compared to 867,700 PJ/a in the Reference Scenario. This dramatic reduction is a crucial prerequisite for achieving a significant share of renewable energy sources in the overall energy supply system, for compensating the phasing out of nuclear energy and for reducing the consumption of fossil fuels.
· The increased use of combined heat and power generation (CHP) also improves the supply system's energy conversion efficiency, increasingly using natural gas and biomass. In the long term, the decreasing demand for heat and the large potential for producing heat directly from renewable energy sources limits the further expansion of CHP.
· The electricity sector will be the pioneer of renewable energy utilisation. By 2050, around 77% of electricity will be produced from renewable energy sources (including large hydro). A capacity of 9,100 GW will produce 28,600 TWh/a renewable electricity in 2050.
· In the heat supply sector, the contribution of renewables will increase to 70% by 2050. Fossil fuels will be increasingly replaced by more efficient modern technologies, in particular biomass, solar collectors and geothermal.
· Before sustainable bio fuels are introduced in the transport sector, the existing large efficiency potentials have to be exploited. As biomass is mainly committed to stationary applications, the production of bio fuels is limited by the availability of sustainable raw materials. Electric vehicles powered by renewable energy sources, will play an increasingly important role from 2020 onwards.
· By 2050, 56% of primary energy demand will be covered by renewable energy sources.
To achieve an economically attractive growth of renewable energy sources, a balanced and timely mobilisation of all technologies is of great importance. Such mobilisation depends on technical potentials, actual costs, cost reduction potentials and technological maturity.


image A WOMAN CLEANS SOLAR PANALS AT THE BAREFOOT COLLEGE IN TILONIA, RAJASTHAN, INDIA.
image NORTH HOYLE WIND FARM, UK'S FIRST WIND FARM IN THE IRISH SEA WHICH WILL SUPPLY 50,000 HOMES WITH POWER.

costs
The slightly higher electricity generation costs (compared to conventional fuels) under the Energy [R]evolution Scenario are compensated for, to a large extent, by reduced demand for electricity. Assuming average costs of 3 cents/kWh for implementing energy efficiency measures, the additional cost for electricity supply under the Energy [R]evolution Scenario will amount to a maximum of $10 billion/a in 2010. These additional costs, which represent society's investment in an environmentally benign, safe and economic energy supply, continue to decrease after 2010. By 2050 the annual costs of electricity supply will be $2,900 billion/a below those in the Reference Scenario.
It is assumed that average crude oil prices will increase from $52.5 per barrel in 2005 to $100 per barrel in 2010, and continue to rise to $140 per barrel in 2050. Natural gas import prices are expected to increase by a factor of four between 2005 and 2050, while coal prices will nearly double, reaching $360 per tonne in 2050. A CO2 `price adder' is applied, which rises from $10 per tonne of CO2 in 2010 to $50 per tonne of in 2050.
development of CO2 emissions
While CO2 emissions worldwide will double under the Reference Scenario up to 2050, and are thus far removed from a sustainable development path, under the Energy [R]evolution Scenario they will decrease from 24,350 million tonnes in 2003 to 10,590 m/t in 2050. Annual per capita emissions will drop from 3.8 tonnes/capita to 1.2 t/capita. In spite of the phasing out of nuclear energy and a growing electricity demand, CO2 emissions will decrease enormously in the electricity sector. In the long run efficiency gains and the increased use of renewable electric vehicles, as well as a sharp expansion in public transport, will even reduce CO2 emissions in the transport sector. With a share of 35% of total emissions in 2050, the power sector will reduce significantly but remain the largest source of CO2 emissions - followed by transport and industry.

to make the energy [r]evolution real and to avoid dangerous climate change, Greenpeace and EREC demand for the energy sector that the following policies and actions are implemented:
1. Phase out all subsidies for fossil fuels and nuclear energy.
2. Internalise the external (social and environmental) costs of energy production through "cap and trade" emissions trading.
3. Mandate strict efficiency standards for all energy consuming appliances, buildings and vehicles.
4. Establish legally binding targets for renewable energy and combined heat and power generation.
5. Reform the electricity markets by guaranteeing priority access to the grid for renewable power generators.
6. Provide defined and stable returns for investors, for example by feed-in tariff programmes.
7. Implement better labelling and disclosure mechanisms to provide more environmental product information.
8. Increase research and development budgets for renewable energy and energy efficiency.

GLOBAL ENERGY [R]EVOLUTION A SUSTAINABLE GLOBAL ENERGY OUTLOOK

long term energy [r]evolution scenarios
The Energy [R]evolution Scenario outlines a sustainable pathway for a new way of using and producing energy up to 2050. Greenpeace, the DLR and the renewable energy industry have now developed this scenario further towards a complete phasing out of fossil fuels in the second half of this century.
A long term scenario over almost 100 years cannot be exact. Projections of economic growth rates, fossil fuel prices or the overall energy demand are of course speculative and by no means represent forecasts. A regional breakdown is also not possible as sufficient technical data, such as exact wind speed data in specific locations, is not available. The grid integration of huge percentages of fluctuating sources such as wind and solar photovoltaics equally needs further scientific and technical research. But such a long term scenario can give us an idea of by when a complete fossil fuel and CO2 free energy supply at a global level is possible, and what long term production capacities for renewable energy sources are needed. In this context we developed two different long term scenarios: the long term Energy [R]evolution and the advanced Energy [R]evolution. The long term scenario follows the same projections until the end of this century.
By 2050, renewable energy sources will account for more than 50% of the world's primary energy demand in the Energy [R]evolution Scenario. Approximately 44% of primary energy supply in 2050 still comes from fossil fuels, mainly oil used in the transport sector, followed by gas and coal in the power sector.
The long term Energy [R]evolution Scenario continues the development pathway up to 2100 with the following outcomes:
· demand: Energy efficiency potentials are largely exploited and primary energy demand therefore stabilises at 2060 levels.
· power sector: The electricity sector will pioneer the fossil fuel phase-out. By 2070 over 93% of electricity will be produced from renewable energy sources, with the remaining gas-fired power plants mainly used for backup power. A capacity of 23,100 GW will produce 56,800 TWh of renewable electricity in 2100 ­ 17 times more than today.
From the currently available technologies, solar photovoltaics, followed by wind power, concentrated solar power and geothermal, have the highest potentials in the power sector. The use of ocean energy might be significantly higher, but with the current state of development, the technical and economical potential remains unclear.

· heating and cooling: The increased use of combined heat and power generation (CHP) in 2050 will remain at the same level up to 2070. It will then fall back slightly to its 2040 level (5,500 TWh) until the end of this century, as the decreasing demand for heat and the large potential for producing heat directly from renewable energy sources, such as solar collectors and geothermal, limits the further expansion of CHP.
· In the heat supply sector, the contribution of renewables will increase to 90% by 2080. A complete fossil fuels phase-out will be realised shortly afterwards.
· transport: Efficient use of transport systems will still be the main way of limiting fuel use. Public transport systems will continue to be far more energy efficient than individual vehicles. However, we assume that cars will still be needed, especially in rural areas. Between 2050 and 2085 the use of oil in cars will be phased out completely and replaced mainly by electric vehicles. The electricity will come from renewable energy sources.
· By 2080, about 90% of primary energy demand will be covered by renewable energy sources; in 2090 the renewable share will reach 98.2%.
The advanced Energy [R]evolution Scenario takes a much more radical approach to the climate crisis facing the world. In order to pull the emergency brake on global emissions it therefore assumes much shorter technical lifetimes for coal-fired power plants - 20 years instead of 40 years. This reduces global CO2 emissions even faster and takes the latest evidence of greater climate sensitivity into account. In order to fill the resulting gap, the annual growth rates of renewable energy sources, especially solar photovoltaics, wind and concentrated solar power plants, have been increased.
Growth rates increase from 2020 onwards to 2050. These expanded growth rates are in line with the current projections of the wind and solar industry (see Global Wind Energy Outlook 2008, Solar Generation 2008). So in the advanced scenario the capacities for solar and wind power generation appear 10 to 15 years earlier than projected in the Energy [R]evolution Scenario. The expansion of geothermal co-generation has also been moved 20 years ahead of its expected take-off. All other results remain the same as in the Energy [R]evolution Scenario, with the only changes affecting the power sector.
The main change for the power sector in the advanced Energy [R]evolution Scenario is that all conventional coal-fired power plants are phased out by 2050. Between 2020 and 2050 a total of about 1,200 GW of capacity will be replaced by solar photovolatics, on- and offshore wind and concentrated solar power plants. By 2050, 86% of electricity will be produced from renewable energy sources and 96% by 2070. Again the remaining fossil fuel-based power production is from gas. Compared to the basic Energy [R]evolution Scenario the expected capacity of renewable energy will emerge 15 years ahead of schedule, while the overall level of renewable power generation from 2085 onwards will be the same.

image THE HUGE SHADOW OF A 60METRE-HIGH WIND TURBINE EXTENDS ACROSS THE GOBI DESERT FLOOR AT THE HE LAN SHAN WIND FARM IN THE NINGXIA PROVINCE, CHINA.

From the renewables industry perspective, these larger quantities are able to be delivered. However, the advanced scenario requires more research and development into the large scale grid integration of renewable energies as well as better regional meteorological data to optimise the mix of different sources.
It is important to highlight that in the Energy [R]evolution Scenario the majority of remaining coal power plants ­ which will be replaced 20 years before the end of their technical lifetime ­ are in China and India. This means that in practice all coal power plants built between 2005 and 2020 will be replaced by renewable energy sources. To support the building of capacity in developing countries significant new public financing, especially from industrialised countries, will be needed. It is vital that specific funding mechanisms are developed under the international climate negotiations that can assist the transfer of financial support to climate change mitigation, including technology transfer. Greenpeace International has developed one option for how such a funding mechanism could work (see Chapter 2).
almost zero CO2 emissions by 2080
While worldwide CO2 emissions will decrease under the Energy [R]evolution Scenario from 10,589 million tonnes in 2050 (51% below 1990 levels) down to 425 m/t in 2090, the advanced scenario would reduce emissions even faster. By 2050, the advanced Energy [R]evolution version would reduce CO2 emissions by 61% below 1990 levels, and 80% below by the year 2075. Annual per capita emissions would drop below 1 t/capita in 2050 under the advanced scenario, compared with around 2060 under the basic Energy [R]evolution.
Further CO2 reductions between 2040 and 2080 are only possible in the transport sector, as the major remaining emitters are combustion engines in cars. It is not possible to replace the remaining fossil fuelled cars with electric vehicles as this would drive electricity demand up again. The increased demand cannot be met by renewables in this timeframe since this would exceed growth rates and grid capacities based on today's knowledge. The only way to cut vehicle emissions further would be to reduce kilometres driven by about 40% between 2040 and 2080.
GLOBAL

THE KYOTO PROTOCOL INTERNATIONAL ENERGY POLICY

RENEWABLE ENERGY TARGETS DEMANDS FOR THE ENERGY SECTOR

image THE LOCAL ALASKAN TELEVISION STATION BROADCASTS A WARNING FOR HIGH TIDES AND EROSION ALONG THE SEASIDE DURING A 2006 OCTOBER STORM WHICH IMPACTS ON THE VILLAGE OF SHISHMAREF. © GP/ROBERT KNOTH

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"never before has humanity been forced to grapple with such an immense environmental crisis."
GREENPEACE INTERNATIONAL CLIMATE CAMPAIGN

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GLOBAL ENERGY [R]EVOLUTION A SUSTAINABLE GLOBAL ENERGY OUTLOOK
1

climate protection | EFFECTS

The greenhouse effect is the process by which the atmosphere traps some of the sun's energy, warming the Earth and moderating our climate. A human-driven increase in `greenhouse gases' has enhanced this effect artificially, raising global temperatures and disrupting our climate. These greenhouse gases include carbon dioxide, produced by burning fossil fuels and through deforestation, methane, released from agriculture, animals and landfill sites, and nitrous oxide, resulting from agricultural production plus a variety of industrial chemicals.
Every day we damage our climate by using fossil fuels (oil, coal and gas) for energy and transport. As a result, climate change is already impacting on our lives, and is expected to destroy the livelihoods of many people in the developing world, as well as ecosystems and species, in the coming decades. We therefore need to significantly reduce our greenhouse gas emissions. This makes both environmental and economic sense.
According to the Intergovernmental Panel on Climate Change, the United Nations forum for established scientific opinion, the world's temperature is expected to increase over the next hundred years by up to 5.8°C. This is much faster than anything experienced so far in human history. The goal of climate policy should be to keep the global mean temperature rise to less than 2°C above pre-industrial levels. At 2°C and above, damage to ecosystems and disruption to the climate system increases dramatically. We have very little time within which we can change our energy system to meet these targets. This means that global emissions will have to peak and start to decline by the end of the next decade at the latest.
Climate change is already harming people and ecosystems. Its reality can be seen in disintegrating polar ice, thawing permafrost, dying coral reefs, rising sea levels and fatal heat waves. It is not only scientists that are witnessing these changes. From the Inuit in the far north to islanders near the Equator, people are already struggling with the impacts of climate change. An average global warming of 2°C threatens millions of people with an increased risk of hunger, malaria, flooding and water shortages. Never before has humanity been forced to grapple with such an immense environmental crisis. If we do not take urgent and immediate action to stop global warming, the damage could become irreversible. This can only happen through a rapid reduction in the emission of greenhouse gases into the atmosphere.

This is a summary of some likely effects if we allow current trends to continue:
Likely effects of small to moderate warming
· Sea level rise due to melting glaciers and the thermal expansion of the oceans as global temperature increases. Massive releases of greenhouse gases from melting permafrost and dying forests.
· A greater risk of more extreme weather events such as heatwaves, droughts and floods. Already, the global incidence of drought has doubled over the past 30 years.
· Severe regional impacts. In Europe, river flooding will increase, as well as coastal flooding, erosion and wetland loss. Flooding will also severely affect low-lying areas in developing countries such as Bangladesh and South China.
· Natural systems, including glaciers, coral reefs, mangroves, alpine ecosystems, boreal forests, tropical forests, prairie wetlands and native grasslands will be severely threatened.
· Increased risk of species extinction and biodiversity loss.
The greatest impacts will be on poorer countries in sub-Saharan Africa, South Asia, Southeast Asia and Andean South America as well as small islands least able to protect themselves from increasing droughts, rising sea levels, the spread of disease and decline in agricultural production.
longer term catastrophic effects Warming from emissions may trigger the irreversible meltdown of the Greenland ice sheet, adding up to seven metres of sea level rise over several centuries. New evidence shows that the rate of ice discharge from parts of the Antarctic mean it is also at risk of meltdown. Slowing, shifting or shutting down of the Atlantic Gulf Stream current will have dramatic effects in Europe, and disrupt the global ocean circulation system. Large releases of methane from melting permafrost and from the oceans will lead to rapid increases of the gas in the atmosphere, and consequent warming.

images 1. THE AFTERMATH OF HURRICANE STAN IN MEXICO. ACCORDING TO THE MEXICAN GOVERNMENT FIGURES THERE ARE MORE THAN 1 MILLION, 100 THOUSAND PEOPLE WHO HAVE BEEN DIRECTLY AFFECTED BY THE FLOODS WITH AN UNKNOWN NUMBER WHO HAVE DISAPPEARED. IN CHIAPAS ALONE, 650 MM RAIN FELL IN A SHORT PERIOD OF TIME CAUSING EXTENSIVE DAMAGE TO ROADS AND HOUSES. 2. CHILDREN LIVING NEXT TO THE SEA PLAY IN SEA WATER THAT HAS SURGED INTO THEIR VILLAGE CAUSED BY THE `KING TIDES', BUOTA VILLAGE, TARAWA ISLAND, KIRIBATI, PACIFIC OCEAN. GREENPEACE AND SCIENTISTS ARE CONCERNED THAT LOW LYING ISLANDS FACE PERMANENT INUNDATION FROM RISING SEAS DUE TO CLIMATE CHANGE. 3. PREECHA BUATHO, 49, IS A RESIDENT OF A VILLAGE IN LAEM TALUMPUK CAPE. HIS FAMILY, HOUSE AND VILLAGE ARE BEING THREATENED BY SEA LEVEL RISE DUE TO CLIMATE CHANGE. LAEM TALUMPUK IS IN PAK PANANG DISTRICT IN THE SOUTHERN PROVINCE OF NAKHON SI THAMMARAT, ON THE EASTERN SHORE OF THE GULF OF THAILAND. CLIMATE CHANGEINDUCED WIND PATTERNS HAVE INTENSIFIED THE SPEED OF COASTAL EROSION IN BOTH THE GULF OF THAILAND AND THE ANDAMAN SEA. ON AVERAGE, 5 METRES OF COASTAL LANDS IN THE REGION ARE LOST EACH YEAR. 4. THE DARK CLOUDS OF AN ADVANCING TORNADO, NEAR FORT DODGE, IOWA, USA. 5. WOMEN FARMERS FROM LILONGWE, MALAWI STAND IN THEIR DRY, BARREN FIELDS CARRYING ON THEIR HEADS AID ORGANISATION HANDOUTS. THIS AREA, THOUGH EXTREMELY POOR HAS BEEN SELF-SUFFICIENT WITH FOOD. NOW THESE WOMEN'S CHILDREN ARE SUFFERING FROM MALNUTRITION.

© GP/SUTTON-HIBBERT

the kyoto protocol
Recognising these threats, the signatories to the 1992 UN Framework Convention on Climate Change agreed the Kyoto Protocol in 1997. The Protocol finally entered into force in early 2005 and its 165 member countries meet twice annually to negotiate further refinement and development of the agreement. Only one major industrialised nation, the United States, has not ratified Kyoto.
The Kyoto Protocol commits its signatories to reduce their greenhouse gas emissions by 5.2% from their 1990 level by the target period of 2008-2012. This has in turn resulted in the adoption of a series of regional and national reduction targets. In the European Union, for instance, the commitment is to an overall reduction of 8%. In order to help reach this target, the EU has also agreed a target to increase its proportion of renewable energy from 6% to 12% by 2010.
At present the Kyoto countries are negotiating the second phase of the agreement, covering the period from 2013-2017. Greenpeace is calling for industrialised country emissions to be reduced by 18% from 1990 levels for this second commitment period, and by 30% for the third period covering 2018-2022. Only with these cuts do we stand a reasonable chance of meeting the 2°C target.
The Kyoto Protocol's architecture relies fundamentally on legally binding emissions reduction obligations. To achieve these targets, carbon is turned into a commodity which can be traded. The aim is to encourage the most economically efficient emissions reductions, in turn leveraging the necessary investment in clean technology from the private sector to drive a revolution in energy supply.
Negotiators are running out of time, however. Signatory countries agreed a negotiating `mandate', known as the Bali Action Plan, in December 2007, but they must complete these negotiations with a final agreement on the second Kyoto commitment period by the end of 2009 at the absolute latest. Forward-thinking nations can move ahead of the game by implementing strong domestic targets now, building the industry and skills bases that will deliver the transition to a low-carbon society, and thereby provide a strong platform from which to negotiate the second commitment period.

"we have to fully acknowledge the significance and urgency of climate change."
HU JINTAO PRESIDENT OF CHINA
GLOBAL ENERGY [R]EVOLUTION A SUSTAINABLE GLOBAL ENERGY OUTLOOK


climate protection | INTERNATIONAL POLICY - TARGETS - DEMANDS

international energy policy
At present, renewable energy generators have to compete with old nuclear and fossil fuel power stations which produce electricity at marginal costs because consumers and taxpayers have already paid the interest and depreciation on the original investments. Political action is needed to overcome these distortions and create a level playing field for renewable energy technologies to compete.
At a time when governments around the world are in the process of liberalising their electricity markets, the increasing competitiveness of renewable energy should lead to higher demand. Without political support, however, renewable energy remains at a disadvantage, marginalised by distortions in the world's electricity markets created by decades of massive financial, political and structural support to conventional technologies. Developing renewables will therefore require strong political and economic efforts, especially through laws that guarantee stable tariffs over a period of up to 20 years. Renewable energy will also contribute to sustainable economic growth, high quality jobs, technology development, global competitiveness and industrial and research leadership.
renewable energy targets
In recent years, in order to reduce greenhouse emissions as well as increase energy security, a growing number of countries have established targets for renewable energy. These are either expressed in terms of installed capacity or as a percentage of energy consumption. These targets have served as important catalysts for increasing the share of renewable energy throughout the world.
A time period of just a few years is not long enough in the electricity sector, however, where the investment horizon can be up to 40 years. Renewable energy targets therefore need to have short, medium and long term steps and must be legally binding in order to be effective. They should also be supported by mechanisms such as feed-in tariffs for renewable electricity generation. In order for the proportion of renewable energy to increase significantly, targets must be set in accordance with the local potential for each technology (wind, solar, biomass etc) and be complemented by policies that develop the skills and manufacturing bases to deliver the agreed quantity of renewable energy.
In recent years the wind and solar power industries have shown that it is possible to maintain a growth rate of 30 to 35% in the renewables sector. In conjunction with the European Photovoltaic Industry Association1, the European Solar Thermal Power Industry Association2 and the Global Wind Energy Council3, the European Renewable Energy Council and Greenpeace have documented the development of those industries from 1990 onwards and outlined a prognosis for growth up to 2020 and 2040.

demands for the energy sector
Greenpeace and the renewables industry have a clear agenda for the policy changes which need to be made to encourage a shift to renewable sources. The main demands are:
1. Phase out all subsidies for fossil fuels and nuclear energy.
2. Internalise external (social and environmental) costs through "cap and trade" emissions trading.
3. Mandate strict efficiency standards for all energy consuming appliances, buildings and vehicles.
4. Establish legally binding targets for renewable energy and combined heat and power generation.
5. Reform the electricity markets by guaranteeing priority access to the grid for renewable power generators.
6. Provide defined and stable returns for investors, for example through feed-in tariff payments.
7. Implement better labelling and disclosure mechanisms to provide more environmental product information.
8. Increase research and development budgets for renewable energy and energy efficiency
Conventional energy sources receive an estimated $250-300 billion4 in subsidies per year worldwide, resulting in heavily distorted markets. Subsidies artificially reduce the price of power, keep renewable energy out of the market place and prop up non-competitive technologies and fuels. Eliminating direct and indirect subsidies to fossil fuels and nuclear power would help move us towards a level playing field across the energy sector. Renewable energy would not need special provisions if markets factored in the cost of climate damage from greenhouse gas pollution. Subsidies to polluting technologies are perverse in that they are economically as well as environmentally detrimental. Removing subsidies from conventional electricity would not only save taxpayers' money. It would also dramatically reduce the need for renewable energy support.

This chapter outlines a Greenpeace proposal for a feed-in tariff system in developing countries financed by emissions trading from OECD countries.
The Energy [R]evolution Scenario shows that renewable electricity generation has huge environmental and economic benefits. However its generation costs, especially in developing countries, will remain higher than those of existing coal or gas-fired power stations for the next five to ten years. To bridge this gap between conventional fossil fuel-based power generation and renewables, a support mechanism is needed.
The Feed in Tariff Fund Emissions Trading model (FFET) is a concept conceived by Greenpeace International5. The aim is the expansion of renewable energy in developing countries with financial support from industrialised nations ­ a mechanism to implement renewable energy technology transfer via future Joint Implementation, Clean Development Mechanism projects or Technology Transfer programmes under the Kyoto Protocol. With the Kyoto countries currently negotiating the second phase of their agreement, covering the period from 2013-2017, the proposed FFET mechanism could be used under all the existing flexible mechanisms, auctioning cap & trade schemes or linked to technology transfer projects.
The thinking behind the FFET in a nutshell is to link the feed-in tariff system, as it has been successfully applied in countries like Germany and Spain, with emissions trading schemes such as the ETS in Europe through already established international funding channels such as development aid banks or the Kyoto Protocol mechanisms.
bankable support schemes
Since the early development of renewable energies within the power sector, there has been an ongoing debate about the best and most effective type of support scheme. The European Commission published a survey in December 2005 which provides a good overview of the experience so far. According to this report, feed-in tariffs are by far the most efficient and successful mechanism. Globally more than 40 countries have adopted some version of the system.
Although the organisational form of these tariffs differs from country to country, there are certain clear criteria which emerge as essential for creating a successful renewable energy policy. At the heart of these is a reliable, bankable support scheme for renewable energy projects which provides long term stability and certainty6. Bankable support schemes result in lower cost projects because they lower the risk for both investors and equipment suppliers. The cost of wind-powered electricity in Germany is up to 40% cheaper than in the United Kingdom7, for example, because the support system is more secure and reliable.
For developing countries, feed-in laws would be an ideal mechanism for the implementation of new renewable energies. The extra costs, however, which are usually covered in Europe, for example, by a very minor increase in the overall electricity price for consumers, are still seen as an obstacle. In order to enable technology transfer from Annex 1 countries to developing countries, a mix of a feed-in law, international finance and emissions trading could be used to establish a locally based renewable energy infrastructure and industry with the assistance of OECD countries.
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learning from experience
The FFET program brings together three different support mechanisms and builds on the experience from 20 years of renewable energy support programmes.
experience of feed-in tariffs
· Feed-in tariffs are seen as the best way forward and very popular, especially in developing countries.
· The main argument against them is the increase in electricity prices for households and industry, as the extra costs are shared across all customers. This is particularly difficult for developing countries, where many people can't afford to spend more money for electricity services.
experience of emissions trading Emissions trading (between countries which need to make emissions reductions and countries where renewable energy projects can be more easily or cheaply implemented) already plays a role in achieving CO2 reductions under the Kyoto Protocol. The experience so far is that:
· The CO2 market is unstable, with the price per tonne varying significantly.
· The market is still a `virtual' market, with only limited actual flow of money.
· Putting a price on CO2 emissions makes fossil fuelled power more expensive, but due to the unstable and fluctuating prices it will not help to make renewable energy projects more economic within the foreseeable future.
· Most systems are not yet delivering real cuts in emissions.
experience of international financing Finance for renewable energy projects is one of the main obstacles in developing countries. While large scale projects have fewer funding problems, small, community based projects, whilst having a high degree of public acceptance, face financing difficulties. The experiences from micro credits for small hydro projects in Bangladesh, for example, as well as wind farms in Denmark and Germany, show how strong local participation and acceptance can be achieved. The main reasons for this are the economic benefits flowing to the local community and careful project planning based on good local knowledge and understanding. When the community identifies the project rather than the project identifying the community, the result is generally faster bottom-up growth of the renewables sector.
combining existing programmes
The basic aims of the Feed-in Tariff Fund Emissions Trading scheme are to facilitate the implementation of feed-in laws for developing countries, to use existing emissions trading schemes to link CO2 prices directly with the uptake of renewable energy, and to use the existing infrastructure,of international financial institutions to secure investment for projects and lower the risk factor.The FFET concept will have three parts ­ fixed feed-in tariffs, emissions trading and a funding arrangement.

implementing the energy [r]evolution | FIXED FEED-IN TARIFFS - EMISSIONS TRADING - THE FFET FUND

1. fixed feed-in tariffs
Feed-in tariffs will provide bankable and long term stable support for the development of a local renewable energy market in developing countries. The tariffs should bridge the gap between conventional power generation costs and those of renewable energy generation.
The key parameters for feed-in tariffs under FFET are:
· Variable tariffs for different renewable energy technologies, depending on their costs and technology maturity, paid for 20 years.
· Payments based on actual generation in order to achieve properly maintained projects with high performance ratios.
· Any additional finance required over the (20 year) period will be secured through a public fund, which could generate some capital income, for example via interest rates, from a soft loan programme to finance renewable energy projects (see below).
· Payment of the `additional costs' for renewable generation will be based on the Spanish system of the wholesale electricity price plus a fixed premium.
A developing country which wants to apply for funding to operate renewable energy projects under the FFET scheme will need to establish clear regulations for the following:
· Guaranteed access to the electricity grid for renewable electricity projects.
· Establishment of a feed-in law based on successful examples.
· Transparent access to all data needed to establish the feed-in tariff, including full records of generated electricity.
· Clear planning and licencing procedures.
2. emissions trading
The traded CO2 emissions will come from OECD countries on top of any commitment under their national emission reduction targets. Every tonne of CO2 will be connected to a specific amount of electricity form renewable energy. A simple approach would be to use a factor of 1kg CO2 for 1 kWh of renewable electricity, which equals the amount of avoided CO2 emissions from an older coal power plant. A more complex method would be to use the average CO2 emissions per kilowatt-hour in the specific country or the world's average, which is currently 0.6kg CO2/kWh. The Energy [R]evolution Scenario shows that the average additional costs (under the proposed energy mix) between 2008 and 2015 are between 1 and 4 cents per kilowatt-hour so the price per tonne of CO2 would be between 10 and 40.
The key parameters for emissions trading under FFET will be:
· 1 tonne CO2 = 1,000 kWh renewable electricity (emissions factor: 1kg CO2/kWh)
· 1 tonne CO2 represents a 20 year `package' of renewable electricity (1,000 kWh = 20 years x annual 50 kWh renewable electricity production)

3. the FFET fund
The FFET fund will act as a buffer between fluctuating CO2 emissions prices and stable long term feed-in tariffs. The fund will secure the payment of the required feed-in tariffs during the whole period (about 20 years) for each project. This fund could be managed by intrernational financial institutions operating in Europe and Central Asia or by Multilateral Development Banks. In order to provide access to finance for small-scale businesses, a co-operation with a local bank with a local presence in villages or cities would be desirable.
All renewable energy projects must have a clear set of environmental criteria which are part of the national licensing procedure in the country where the project will generate electricity. Those criteria will have to meet a minimum environmental standard defined by an independent monitoring group. If there are already acceptable criteria developed, for example for CDM projects, they should be adopted rather than reinventing the wheel. The board members will come from NGOs, energy and finance experts as well as members of the governments involved. The fund will not be able to use the money for speculative investments. It can only provide soft loans for FFET projects.
The key parameters for the FFET fund will be:
· The fund will guarantee the payment of the total feed-in tariffs over a period of 20 years if the project is operated properly.
· The fund will receive annual income from emissions trading under FFET.
· The fund can provide soft loans to finance renewable energy projects.
· The fund will generate income from interest rates only.
· The fund will pay feed-in tariffs annually only on the basis of generated electricity.
· The operator of a FFET project is required to transmit all relevant data about generation to a central database. This database will also be used to evaluate the performance of the project.
· Every FFET project must have a professional maintenance company to ensure high availability.
· The grid operator must do its own monitoring and send generation data to the FFET fund. Data from the project and grid operators will be compared regularly to check consistency.

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implementing the energy [r]evolution | FFET SCHEME

Nuclear energy is a relatively small industry with big problems. It covers just one sixteenth of the world's primary energy consumption, a share set to decline over the coming decades. The average age of operating commercial nuclear reactors is 23 years, so more power stations are being shut down than started. In 2007, world nuclear production fell by 1.8 % and the number of operating reactors was 439, five less than the historical peak of 2002.
In terms of new power stations, the amount of nuclear capacity added annually between 2000 and 2007 was 2,500 MWe on average. This was six times less than wind power (13,300 MWe per annum between 2000 and 2007). In 2007, newly constructed renewable energy power plants in Germany generated 13 TWh of electricity ­ as much as two large nuclear units.
Despite the rhetoric of a `nuclear renaissance', the industry is struggling with a massive increase in costs and construction delays as well as safety and security problems linked to reactor operation, radioactive waste and nuclear proliferation.
a solution to climate protection?
The promise of nuclear energy to contribute to both climate protection and energy supply needs to be checked against reality. In the most recent Energy Technology Perspectives report published by the International Energy Agency8, for example, its Blue Map scenario outlines a future energy mix which would halve global carbon emissions by the middle of this century. To reach this goal the IEA assumes a massive expansion of nuclear power between now and 2050, with installed capacity increasing four-fold and electricity generation reaching 9,857 TWh/year, compared to 2,608 TWh in 2007. In order to achieve this, the report says that 32 large reactors (1,000 MWe) would have to be built every year from now until 2050. This would be unrealistic, expensive, hazardous and too late to make a difference.
unrealistic: Such a rapid growth is practically impossible given the technical limitations. This scale of development was achieved in the history of nuclear power for only two years at the peak of the statedriven boom of the mid-1980s. It is unlikely to be achieved again, not to mention maintained for 40 consecutive years. While 1984 and 1985 saw 31 GW of newly added nuclear capacity, the decade average was 17 GW annually. In the past ten years, only three large reactors have been brought on line each year, and the current production capacity of the global nuclear industry cannot deliver more than an annual six units.

expensive: The IEA scenario assumes very optimistic investment costs of $2,100/kWe installed, in line with what the industry has been recently promising. The reality indicates three times that much. Recent estimates by US business analysts Moody's (June 2008) put the cost of nuclear investment as high as $7,000/kWe. Price quotes for projects under preparation in the US cover a range from $5,200 to 8,000/kWe9. The latest cost estimate for the first French EPR pressurised water reactor being built in Finland is $5,200/kWe, a figure likely to increase for later reactors as prices escalate. The Wall Street Journal has reported that the cost index for nuclear components has risen by 173 % since 2000 ­ a near tripling over the past eight years10. Building 1,400 large reactors (1,000 MWe), even at the current cost of about $7,000/kWe, would require an investment of US$9.8 trillion.
hazardous: Massive expansion of nuclear energy would necessarily lead to a large increase in related hazards, such as serious reactor accidents, growing stockpiles of deadly high level nuclear waste which will need to be safeguarded for thousands of years and potential proliferation of both nuclear technologies and materials that can be diverted to military or terrorist use. The 1,400 large operating reactors in 2050 would generate an annual 35,000 tons of spent fuel (assuming they are light water reactors, the most common design for most new projects). This also means the production of 350,000 kilograms of plutonium each year, enough to build 35,000 crude nuclear weapons.
Most of the expected electricity demand growth by 2050 will occur in non-OECD countries. This means that a large proportion of the new reactors would need to be built in those countries in order to have a global impact on emissions. At the moment, the list of countries with announced nuclear ambitions is long and worrying in terms of their political situation and stability, especially with the need to guarantee against the hazards of accidents and proliferation for many decades. The World Nuclear Association listed the Emerging Nuclear Energy Countries in May 2008 as Albania, Belarus, Italy, Portugal, Turkey, Norway, Poland, Estonia, Latvia, Ireland, Iran, the Gulf states, Yemen, Israel, Syria, Jordan, Egypt, Tunisia, Libya, Algeria, Morocco, Azerbaijan, Georgia, Kazakhstan, Mongolia, Bangladesh, Indonesia, Philippines, Vietnam, Thailand, Malaysia, Australia, New Zealand, Chile, Venezuela, Nigeria, Ghana and Namibia.
slow: Climate science says that we need to reach a peak of global greenhouse gas emissions in 2015 and reduce them by 20 % in 2020. Even in developed countries with an established nuclear infrastructure it takes at least a decade from the decision to build a reactor to the delivery of its first electricity, and often much longer. Out of 35 reactors officially listed as under construction by the IEA in mid-July 2008, one third had been in this category for two decades or more, indicating that these projects are not progressing. This means that even if the world's governments decided to implement strong nuclear expansion now, only a few reactors would start generating electricity before 2020. The contribution from nuclear power towards reducing emissions would come too late to help.


nuclear power blocks solutions
Even if the ambitious nuclear scenario is implemented, regardless of costs and hazards, the IEA concludes that the contribution of nuclear power to reductions in greenhouse gas emissions from the energy sector would be only 4.6 % - less than 3 % of the global overall reduction required.
There are other technologies that can deliver much larger emission reductions, and much faster. Their investment costs are lower and they do not create global security risks. Even the IEA finds that the combined potential of efficiency savings and renewable energy to cut emissions by 2050 is more than ten times larger than that of nuclear.
The world has limited time, finance and industrial capacity to change our energy sector and achieve a large reduction in greenhouse emissions. Choosing the pathway by spending $10 trillion on nuclear development would be a fatally wrong decision. It would not save the climate but it would necessarily take resources away from solutions described in this report and at the same time create serious global security hazards. Therefore new nuclear reactors are a clearly dangerous obstacle to the protection of the climate.
nuclear power in the energy [r]evolution scenario
For the reasons explained above, the Energy [R]evolution Scenario envisages a nuclear phase-out. Existing reactors would be closed at the end of their average operational lifetime of 35 years. We assume that no new construction is started after 2008 and only two thirds of the reactors currently under construction will be finally put into operation.
the dangers of nuclear power
Although the generation of electricity through nuclear power produces much less carbon dioxide than fossil fuels, there are multiple threats to people and the environment from its operations. The main risks are:
· Nuclear Proliferation
· Nuclear Waste
· Safety Risks
These are the background to why nuclear power has been discounted as a future technology in the Energy [R]evolution Scenario.


1. nuclear proliferation
Manufacturing a nuclear bomb requires fissile material - either uranium-235 or plutonium-239. Most nuclear reactors use uranium as a fuel and produce plutonium during their operation. It is impossible to adequately protect a large reprocessing plant to prevent the diversion of plutonium to nuclear weapons. A smallscale plutonium separation plant can be built in four to six months, so any country with an ordinary reactor can produce nuclear weapons relatively quickly.
The result is that nuclear power and nuclear weapons have grown up like Siamese twins. Since international controls on nuclear proliferation began, Israel, India, Pakistan and North Korea have all obtained nuclear weapons, demonstrating the link between civil and military nuclear power. Both the International Atomic Energy Agency (IAEA) and the Nuclear Non-proliferation Treaty (NPT) embody an inherent contradiction - seeking to promote the development of `peaceful' nuclear power whilst at the same time trying to stop the spread of nuclear weapons
Israel, India and Pakistan all used their civil nuclear operations to develop weapons capability, operating outside international safeguards. North Korea developed a nuclear weapon even as a signatory of the NPT. A major challenge to nuclear proliferation controls has been the spread of uranium enrichment technology to Iran, Libya and North Korea. The Director General of the International Atomic Energy Agency, Mohamed ElBaradei, has said that "should a state with a fully developed fuel-cycle capability decide, for whatever reason, to break away from its nonproliferation commitments, most experts believe it could produce a nuclear weapon within a matter of months11."
The United Nations Intergovernmental Panel on Climate Change has also warned that the security threat of trying to tackle climate change with a global fast reactor programme (using plutonium fuel) "would be colossal"12. Even without fast reactors, all of the reactor designs currently being promoted around the world could be fuelled by MOX (mixed oxide fuel), from which plutonium can be easily separated.
Restricting the production of fissile material to a few `trusted' countries will not work. It will engender resentment and create a colossal security threat. A new UN agency is needed to tackle the twin threats of climate change and nuclear proliferation by phasing out nuclear power and promoting sustainable energy, in the process promoting world peace rather than threatening it.



nuclear power | NUCLEAR WASTE - SAFETY RISKS

3
2. nuclear waste
The nuclear industry claims it can `dispose' of its nuclear waste by burying it deep underground, but this will not isolate the radioactive material from the environment forever. A deep dump only slows down the release of radioactivity into the environment. The industry tries to predict how fast a dump will leak so that it can claim that radiation doses to the public living nearby in the future will be "acceptably low". But scientific understanding is not sufficiently advanced to make such predictions with any certainty.
As part of its campaign to build new nuclear stations around the world, the industry claims that problems associated with burying nuclear waste are to do with public acceptability rather than technical issues. It points to nuclear dumping proposals in Finland, Sweden or the United States to underline its argument.
The most hazardous waste is the highly radioactive waste (or spent) fuel removed from nuclear reactors, which stays radioactive for hundreds of thousands of years. In some countries the situation is exacerbated by `reprocessing' this spent fuel ­ which involves dissolving it in nitric acid to separate out weapons-usable plutonium. This process leaves behind a highly radioactive liquid waste. There are about 270,000 tonnes of spent nuclear waste fuel in storage, much of it at reactor sites. Spent fuel is accumulating at around 12,000 tonnes per year, with around a quarter of that going for reprocessing13. No country in the world has a solution for high level waste.
The IAEA recognises that, despite its international safety requirements, "...radiation doses to individuals in the future can only be estimated and that the uncertainties associated with these estimates will increase for times farther into the future."
The least damaging option for waste already created at the current time is to store it above ground, in dry storage at the site of origin, although this option also presents major challenges and threats. The only real solution is to stop producing the waste.

3. safety risks
Windscale (1957), Three Mile Island (1979), Chernobyl (1986) and Tokaimura (1999) are only a few of the hundreds of nuclear accidents which have occurred to date.
A simple power failure at a Swedish nuclear plant in 2006 highlighted our vulnerability to nuclear catastrophe. Emergency power systems at the Forsmark plant failed for 20 minutes during a power cut and four of Sweden's 10 nuclear power stations had to be shut down. If power was not restored there could have been a major incident within hours. A former director of the Forsmark plant later said that "it was pure luck there wasn't a meltdown". The closure of the plants removed at a stroke roughly 20% of Sweden's electricity supply.
A nuclear chain reaction must be kept under control, and harmful radiation must, as far as possible, be contained within the reactor, with radioactive products isolated from humans and carefully managed. Nuclear reactions generate high temperatures, and fluids used for cooling are often kept under pressure. Together with the intense radioactivity, these high temperatures and pressures make operating a reactor a difficult and complex task.
The risks from operating reactors are increasing and the likelihood of an accident is now higher than ever. Most of the world's reactors are more than 20 years old and therefore more prone to age related failures. Many utilities are attempting to extend their life from the 40 years or so they were originally designed for to around 60 years, posing new risks.
De-regulation has meanwhile pushed nuclear utilities to decrease safety-related investments and limit staff whilst increasing reactor pressure and operational temperature and the burn-up of the fuel. This accelerates ageing and decreases safety margins.
New so-called passively safe reactors have many safety systems replaced by `natural' processes, such as gravity fed emergency cooling water and air cooling. This can make them more vulnerable to terrorist attack.

"... reactors with gravity fed emergency cooling water and air cooling can make them more vulnerable to terrorist attacks."

nuclear power | NUCLEAR FUEL CYCLE

U#92

1. uranium mining
Uranium, used in nuclear power plants, is extracted from huge mines in Canada, Australia, Russia and Nigeria. Mine workers can breathe in radioactive gas from which they are in danger of contracting lung cancer. Uranium mining produces huge quantities of mining debris, including radioactive particles which can contaminate surface water and food.

4. power plant operation
Uranium nuclei are split in a nuclear reactor, releasing energy which heats up water. The compressed steam is converted in a turbine generator into electricity. This process creates a radioactive `cocktail' which involves more than 100 products. One of these is the highly toxic and long-lasting plutonium. Radioactive material can enter the environment through accidents at nuclear power plants. The worst accident to date happened at Chernobyl in the then Soviet Union in 1986. A nuclear reactor generates enough plutonium every year for the production of as many as 39 nuclear weapons.

5. reprocessing
Reprocessing involves the chemical extraction of contaminated uranium and plutonium from used reactor fuel rods. There are now over 230,000 kilograms of plutonium stockpiled around the world from reprocessing ­ five kilograms is sufficient for one nuclear bomb. Reprocessing is not the same as recycling: the volume of waste increases many tens of times and millions of litres of radioactive waste are discharged into the sea and air each day. The process also demands the transport of radioactive material and nuclear waste by ship, rail, air and road around the world. An accident or terrorist attack could release vast quantities of nuclear material into the environment. There is no way to guarantee the safety of nuclear transport.

2. uranium enrichment
Natural uranium and concentrated `yellow cake' contain just 0.7% of fissionable uranium 235. To use the material in a nuclear reactor, the share must go up to 3 or 5 %. This process can be carried out in 16 facilities around the world. 80% of the total volume is rejected as `tails', a waste product. Enrichment generates massive amounts of `depleted uranium' that ends up as long-lived radioactive waste or is used in weapons or as tank shielding.

3. fuel rod ­ production
Enriched material is converted into uranium dioxide and compressed to pellets in fuel rod production facilities. These pellets fill 4m long tubes called fuel rods. There are 29 fuel rod production facilities globally. The worst accident in this type of facility happened in September 1999 in Tokaimura, Japan, when two workers died. Several hundred workers and villagers have suffered radioactive contamination.

6. waste storage
There is not a single final storage facility for nuclear waste available anywhere in the world. Safe secure storage of high level waste over thousands of years remains unproven, leaving a deadly legacy for future generations. Despite this the nuclear industry continues to generate more and more waste each day.

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the energy [r]evolution

GLOBAL
4

KEY PRINCIPLES A DEVELOPMENT PATHWAY A DECENTRALISED ENERGY FUTURE

OPTIMISED INTEGRATION OF RENEWABLE ENERGY

FUTURE POWER GRIDS RURAL ELECTRIFICATION

G. POROPAT/DREAMSTIME

4

DE

COUPLE GROWTH FROM FOSSIL FUEL USE. ©

"half the solution to climate change is the smart use of power."
GREENPEACE INTERNATIONAL CLIMATE CAMPAIGN
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image ICE AND WATER IN THE NORTH POLE. GREENPEACE EXPLORERS, LONNIE DUPRE AND ERIC LARSEN MAKE HISTORY AS THEY BECOME THE FIRSTEVER TO COMPLETE A TREK TO THE NORTH POLE IN SUMMER. THE DUO UNDERTAKE THE EXPEDITION TO BRING ATTENTION TO THE PLIGHT OF THE POLAR BEAR WHICH SCIENTISTS CLAIM COULD BE EXTINCT AS EARLY AS 2050 DUE TO THE EFFECTS OF GLOBAL WARMING.


The climate change imperative demands nothing short of an energy revolution. The expert consensus is that this fundamental change must begin very soon and be well underway within the next ten years in order to avert the worst impacts. What we need is a complete transformation in the way we produce, consume and distribute energy and at the same time maintain economic growth. Nothing short of such a revolution will enable us to limit global warming to less than a rise in temperature of 2°C, above which the impacts become devastating.
Current electricity generation relies mainly on burning fossil fuels, with their associated CO2 emissions, in very large power stations which waste much of their primary input energy. More energy is lost as the power is moved around the electricity grid network and converted from high transmission voltage down to a supply suitable for domestic or commercial consumers. The system is innately vulnerable to disruption: localised technical, weather-related or even deliberately caused faults can quickly cascade, resulting in widespread blackouts. Whichever technology is used to generate electricity within this old fashioned configuration, it will inevitably be subject to some, or all, of these problems. At the core of the Energy [R]evolution there therefore needs to be a change in the way that energy is both produced and distributed.
key principles
the energy [r]evolution can be achieved by adhering to five key principles:
1.respect natural limits ­ phase out fossil fuels by the end of this century We must learn to respect natural limits. There is only so much carbon that the atmosphere can absorb. Each year we emit over 25 billion tonnes of carbon equivalent; we are literally filling up the sky. Geological resources of coal could provide several hundred years of fuel, but we cannot burn them and keep within safe limits. Oil and coal development must be ended.
The Energy [R]evolution Scenario has a target to reduce energy related CO2 emissions to a maximum of 10 Gt (Giga tonnes) by 2050 and phase out fossil fuels by 2085.
2.equity and fairness As long as there are natural limits there needs to be a fair distribution of benefits and costs within societies, between nations and between present and future generations. At one extreme, a third of the world's population has no access to electricity, whilst the most industrialised countries consume much more than their fair share.
The effects of climate change on the poorest communities are exacerbated by massive global energy inequality. If we are to address climate change, one of the principles must be equity and fairness, so that the benefits of energy services ­ such as light, heat, power and transport ­ are available for all: north and south, rich and poor. Only in this way can we create true energy security, as well as the conditions for genuine human wellbeing.
The Energy [R]evolution Scenario has a target to achieve energy equity as soon as technically possible. By 2050 the average per capita emission should be between 1 and 2 tonnes of CO2.

the energy [r]evolution | KEY PRINCIPLES - FROM PRINCIPLES TO PRACTISE

3. implement clean, renewable solutions and decentralise

energy systems There is no energy shortage. All we need to do is

use existing technologies to harness energy effectively and

4

efficiently. Renewable energy and energy efficiency measures are

ready, viable and increasingly competitive. Wind, solar and other

renewable energy technologies have experienced double digit

market growth for the past decade.

Just as climate change is real, so is the renewable energy sector. Sustainable decentralised energy systems produce less carbon emissions, are cheaper and involve less dependence on imported fuel. They create more jobs and empower local communities. Decentralised systems are more secure and more efficient. This is what the Energy [R]evolution must aim to create.

"THE STONE AGE DID NOT END FOR LACK OF STONE, AND THE OIL AGE WILL END LONG BEFORE THE WORLD RUNS OUT OF OIL."
Sheikh Zaki Yamani, former Saudi Arabian oil minister
To stop the Earth's climate spinning out of control, most of the world's fossil fuel reserves ­ coal, oil and gas ­ must remain in the ground. Our goal is for humans to live within the natural limits of our small planet.
4.decouple growth from fossil fuel use Starting in the developed countries, economic growth must fully decouple from fossil fuels. It is a fallacy to suggest that economic growth must be predicated on their increased combustion.
We need to use the energy we produce much more efficiently, and we need to make the transition to renewable energy ­ away from fossil fuels ­ quickly in order to enable clean and sustainable growth.
5.phase out dirty, unsustainable energy We need to phase out coal and nuclear power. We cannot continue to build coal plants at a time when emissions pose a real and present danger to both ecosystems and people. And we cannot continue to fuel the myriad nuclear threats by pretending nuclear power can in any way help to combat climate change. There is no role for nuclear power in the Energy [R]evolution.
from principles to practice
In 2005, renewable energy sources accounted for 13% of the world's primary energy demand. Biomass, which is mostly used for heating, is the main renewable energy source. The share of renewable energy in electricity generation was 18%. The contribution of renewables to primary energy demand for heat supply was around 24%. About 80% of primary energy supply today still comes from fossil fuels, and 6% from nuclear power14.
The time is right to make substantial structural changes in the energy and power sector within the next decade. Many power plants in industrialised countries, such as the USA, Japan and the European Union, are nearing retirement; more than half of all operating power plants are over 20 years old. At the same time developing countries, such as China, India and Brazil, are looking to satisfy the growing energy demand created by expanding economies.
references 14 `ENERGY BALANCE OF NON-OECD COUNTRIES' AND `ENERGY BALANCE OF OECD COUNTRIES', IEA, 2007
29

GLOBAL ENERGY [R]EVOLUTION A SUSTAINABLE GLOBAL ENERGY OUTLOOK

the energy [r]evolution | DEVELOPMENT PATHWAY

Within the next ten years, the power sector will decide how this new demand will be met, either by fossil and nuclear fuels or by the
4 efficient use of renewable energy. The Energy [R]evolution Scenario
is based on a new political framework in favour of renewable energy and cogeneration combined with energy efficiency.
To make this happen both renewable energy and cogeneration ­ on a large scale and through decentralised, smaller units ­ have to grow faster than overall global energy demand. Both approaches must replace old generating technologies and deliver the additional energy required in the developing world.
As it is not possible to switch directly from the current large scale fossil and nuclear fuel based energy system to a full renewable energy supply, a transition phase is required to build up the necessary infrastructure. Whilst remaining firmly committed to the promotion of renewable sources of energy, we appreciate that gas, used in appropriately scaled cogeneration plant, is valuable as a transition fuel, and able to drive cost-effective decentralisation of the energy infrastructure. With warmer summers, tri-generation, which incorporates heat-fired absorption chillers to deliver cooling capacity in addition to heat and power, will become a particularly valuable means to achieve emissions reductions.
a development pathway
The Energy [R]evolution envisages a development pathway which turns the present energy supply structure into a sustainable system. There are two main stages to this.
step 1: energy efficiency The Energy [R]evolution is aimed at the ambitious exploitation of the potential for energy efficiency. It focuses on current best practice and technologies which will become available in the future, assuming continuous innovation. The energy savings are fairly equally distributed over the three sectors ­ industry, transport and domestic/business. Intelligent use, not abstinence, is the basic philosophy for future energy conservation.
The most important energy saving options are improved heat insulation and building design, super efficient electrical machines and drives, replacement of old style electrical heating systems by renewable heat production (such as solar collectors) and a reduction in energy consumption by vehicles used for goods and passenger traffic. Industrialised countries, which currently use energy in the most inefficient way, can reduce their consumption drastically without the loss of either housing comfort or information and entertainment electronics. The Energy [R]evolution Scenario uses energy saved in OECD countries as a compensation for the increasing power requirements in developing countries. The ultimate goal is stabilisation of global energy consumption within the next two decades. At the same time the aim is to create "energy equity" ­ shifting the current one-sided waste of energy in the industrialised countries towards a fairer worldwide distribution of efficiently used supply.
A dramatic reduction in primary energy demand compared to the IEA's "Reference Scenario" (see Chapter 6) ­ but with the same GDP and population development - is a crucial prerequisite for achieving a significant share of renewable energy sources in the overall energy supply system, compensating for the phasing out of nuclear energy and reducing the consumption of fossil fuels.

step 2: structural changes
decentralised energy and large scale renewables In order to achieve higher fuel efficiencies and reduce distribution losses, the Energy [R]evolution Scenario makes extensive use of Decentralised Energy (DE).This is energy generated at or near the point of use.
DE is connected to a local distribution network system, supplying homes and offices, rather than the high voltage transmission system. The proximity of electricity generating plant to consumers allows any waste heat from combustion processes to be piped to buildings nearby, a system known as cogeneration or combined heat and power. This means that nearly all the input energy is put to use, not just a fraction as with traditional centralised fossil fuel plant.
DE also includes stand-alone systems entirely separate from the public networks, for example heat pumps, solar thermal panels or biomass heating. These can all be commercialised at a domestic level to provide sustainable low emission heating. Although DE technologies can be considered `disruptive' because they do not fit the existing electricity market and system, with appropriate changes they have the potential for exponential growth, promising `creative destruction' of the existing energy sector.
A huge proportion of global energy in 2050 will be produced by decentralised energy sources, although large scale renewable energy supply will still be needed in order to achieve a fast transition to a renewables dominated system. Large offshore wind farms and concentrating solar power (CSP) plants in the sunbelt regions of the world will therefore have an important role to play.
cogeneration The increased use of combined heat and power generation (CHP) will improve the supply system's energy conversion efficiency, whether using natural gas or biomass. In the longer term, decreasing demand for heat and the large potential for producing heat directly from renewable energy sources will limit the further expansion of CHP.
renewable electricity The electricity sector will be the pioneer of renewable energy utilisation. All renewable electricity technologies have been experiencing steady growth over the past 20 to 30 years of up to 35% annually and are expected to consolidate at a high level between 2030 and 2050. By 2050, the majority of electricity will be produced from renewable energy sources. Expected growth of electricity use in transport will further promote the effective use of renewable power generation technologies.
renewable heating In the heat supply sector, the contribution of renewables will increase significantly. Growth rates are expected to be similar to those of the renewable electricity sector. Fossil fuels will be increasingly replaced by more efficient modern technologies, in particular biomass, solar collectors and geothermal. By 2050, renewable energy technologies will satisfy the major part of heating and cooling demand.

optimised integration of renewable energy
Modification of the energy system will be necessary to accommodate the significantly higher shares of renewable energy expected under the Energy [R]evolution Scenario. This is not unlike what happened in the 1970s and 1980s, when most of the centralised power plants now operating were constructed in OECD countries. New high voltage power lines were built, night storage heaters marketed and large electric-powered hot water boilers installed in order to sell the electricity produced by nuclear and coal-fired plants at night.
Several OECD countries have demonstrated that it is possible to smoothly integrate a large proportion of decentralised energy, including variable sources such as wind. A good example is Denmark, which has the highest percentage of combined heat and power generation and wind power in Europe. With strong political support, 50% of electricity and 80% of district heat is now supplied by cogeneration plants. The contribution of wind power has reached more than 18% of Danish electricity demand. At certain times, electricity generation from cogeneration and wind turbines even exceeds demand. The load compensation required for grid stability in Denmark is managed both through regulating the capacity of the few large power stations and through import and export to neighbouring countries. A three tier tariff system enables balancing of power generation from the decentralised power plants with electricity consumption on a daily basis.
It is important to optimise the energy system as a whole through intelligent management by both producers and consumers, by an appropriate mix of power stations and through new systems for storing electricity.

appropriate power station mix: The power supply in OECD countries is mostly generated by coal and ­ in some cases ­ nuclear power stations, which are difficult to regulate. Modern gas power stations, by contrast, are not only highly efficient but easier and faster to regulate and thus better able to compensate for fluctuating loads. Coal and nuclear power stations have lower fuel and operating costs but comparably high investment costs. They must therefore run round-the-clock as `base load' in order to earn back their investment. Gas power stations have lower investment costs and are profitable even at low output, making them better suited to balancing out the variations in supply from renewable energy sources.
load management: The level and timing of demand for electricity can be managed by providing consumers with financial incentives to reduce or shut off their supply at periods of peak consumption. Control technology can be used to manage the arrangement. This system is already used for some large industrial customers. A Norwegian power supplier even involves private household customers by sending them a text message with a signal to shut down. Each household can decide in advance whether or not they want to participate. In Germany, experiments are being conducted with time flexible tariffs so that washing machines operate at night and refrigerators turn off temporarily during periods of high demand.
This type of load management has been simplified by advances in communications technology. In Italy, for example, 30 million innovative electricity counters have been installed to allow remote meter reading and control of consumer and service information. Many household electrical products or systems, such as refrigerators, dishwashers, washing machines, storage heaters, water pumps and air conditioning, can be managed either by temporary shut-off or by rescheduling their time of operation, thus freeing up electricity load for other uses.

generation management: Renewable electricity generation systems can also be involved in load optimisation. Wind farms, for example, can be temporarily switched off when too much power is available on the network.
energy storage: Another method of balancing out electricity supply and demand is through intermediate storage. This storage can be decentralised, for example by the use of batteries, or centralised. So far, pumped storage hydropower stations have been the main method of storing large amounts of electric power. In a pumped storage system, energy from power generation is stored in a lake and then allowed to flow back when required, driving turbines and generating electricity. 280 such pumped storage plants exist worldwide. They already provide an important contribution to security of supply, but their operation could be better adjusted to the requirements of a future renewable energy system.
In the long term, other storage solutions are beginning to emerge. One promising solution besides the use of hydrogen is the use of compressed air. In these systems, electricity is used to compress air into deep salt domes 600 metres underground and at pressures of up to 70 bar. At peak times, when electricity demand is high, the air is allowed to flow back out of the cavern and drive a turbine. Although this system, known as CAES (Compressed Air Energy Storage) currently still requires fossil fuel auxiliary power, a socalled "adiabatic" plant is being developed which does not. To achieve this, the heat from the compressed air is intermediately stored in a giant heat store. Such a power station can achieve a storage efficiency of 70%.
The forecasting of renewable electricity generation is also continually improving. Regulating supply is particularly expensive when it has to be found at short notice. However, prediction techniques for wind power generation have become considerably more accurate in recent years and are still being improved. The demand for balancing supply will therefore decrease in the future.

the "virtual power station" 16

The rapid development of information technologies is helping to pave the way for a decentralised energy supply based on

4

the energy [r]evolution | THE "VIRTUAL POWER STATION"

cogeneration plants, renewable energy systems and conventional

power stations. Manufacturers of small cogeneration plants already

offer internet interfaces which enable remote control of the system.

It is now possible for individual householders to control their

electricity and heat usage so that expensive electricity drawn from

the grid can be minimised ­ and the electricity demand profile is

smoothed. This is part of the trend towards the `smart house' where

its mini cogeneration plant becomes an energy management centre.

We can go one step further than this with a `virtual power station'.

Virtual does not mean that the power station does not produce real

electricity. It refers to the fact that there is no large, spatially

located power station with turbines and generators. The hub of the

virtual power station is a control unit which processes data from

many decentralised power stations, compares them with predictions

of power demand, generation and weather conditions, retrieves the

available power market prices and then intelligently optimises the

overall power station activity. Some public utilities already use such

systems, integrating cogeneration plants, wind farms, photovoltaic

systems and other power plants. The virtual power station can also

link consumers into the management process.

"it is important to optimise the energy system as a whole through intelligent management by both producers and consumers..."

future power grids

4

The power grid network must also change in order to realise decentralised structures with a high share of renewable energy.

the energy [r]evolution | FUTURE POWER GRIDS

Today's grids are designed to transport power from a few

centralised power stations out to the passive consumers. A future

system must enable an active integration of consumers and

decentralised power generators and thus realise real time two-way

power and information flows. Large power stations will feed

electricity into the high voltage grid but small decentralised systems

such as solar, cogeneration and wind plants will deliver their power

into the low or medium voltage grid. In order to transport

electricity from renewable generation such as offshore wind farms

in remote areas (see box), a limited number of new high voltage

transmission lines will need to be constructed. These power lines will

also be available for cross-border power trade. Within the Energy

[R]evolution Scenario, the share of variable renewable energy

sources is expected to reach about 10% of total electricity

generation by 2020 and about 35% by 2050.

case 1: a north sea electricity grid
A new Greenpeace report shows how a regionally integrated approach to the large-scale development of offshore wind in the North Sea could deliver reliable clean energy for millions of homes. The `North Sea Electricity Grid [R]evolution' report (September 2008) calls for the creation of an offshore network to enable the smooth flow of electricity generated from renewable energy sources into the power systems of seven different countries - the United Kingdom, France, Germany, Belgium, The Netherlands, Denmark and Norway ­ at the same time enabling significant emissions savings. The cost of developing the grid is expected to be between 15 and 20 billion. This investment would not only allow the broad integration of renewable energy but also unlock unprecedented power trading opportunities and cost efficiency. In a recent example, a new 600 kilometre-long power line between Norway and the Netherlands cost 600 million to build, but is already generating a daily cross-border trade valued at 800,000.
The grid would enable the efficient integration of renewable energy into the power system across the whole North Sea region. By aggregating power generation from wind farms spread across the whole area, periods of very low or very high power flows would be reduced to a negligible amount. A dip in wind power generation in one area would be `balanced' by higher production in another area, even hundreds of kilometres away. Over a year, an installed offshore wind power capacity of 68.4 GW in the North Sea would be able to generate an estimated 247 TWh of electricity.
An offshore grid in the North Sea would also allow, for example, the import of electricity from hydro power generation in Norway to the British and UCTE (Central European) network. This could replace thermal baseload plants and increase flexibility within a portfolio. In addition, increased liquidity and trading facilities on the European power markets will allow for a more efficient portfolio management. The value of such an offshore therefore lies in its contribution to increased security of supply, its function in aggregating the dispatch of power from offshore wind farms and its role as a facilitator for power exchange and trade between regions and power systems.

"a future system must enable an active integration of consumers and decentralised power generators..."

34

Energy is central to reducing poverty, providing major benefits in the areas of health, literacy and equity. More than a quarter of the

world's population has no access to modern energy services. In sub-

Saharan Africa, 80% of people have no electricity supply. For

cooking and heating, they depend almost exclusively on burning

biomass ­ wood, charcoal and dung.

Poor people spend up to a third of their income on energy, mostly to cook food. Women in particular devote a considerable amount of time to collecting, processing and using traditional fuel for cooking. In India, two to seven hours each day can be devoted to the collection of cooking fuel. This is time that could be spent on child care, education or income generation. The World Health Organisation estimates that 2.5 million women and young children in developing countries die prematurely each year from breathing the fumes from indoor biomass stoves.

The Millennium Development Goal of halving global poverty by 2015 will not be reached without adequate energy to increase production, income and education, create jobs and reduce the daily grind involved in having to just survive. Halving hunger will not come about without energy for more productive growing, harvesting, processing and marketing of food.

Improving health and reducing death rates will not happen without energy for the refrigeration needed for clinics, hospitals and vaccination campaigns.The world's greatest child killer, acute respiratory infection, will not be tackled without dealing with smoke from cooking fires in the home. Children will not study at night without light in their homes. Clean water will not be pumped or treated without energy.
The UN Commission on Sustainable Development argues that "to implement the goal accepted by the international community of halving the proportion of people living on less than US $1 per day by 2015, access to affordable energy services is a prerequisite".
the role of sustainable, clean renewable energy
To achieve the dramatic emissions cuts needed to avoid climate change ­ in the order of 80% in OECD countries by 2050 ­ will require a massive uptake of renewable energy. The targets for renewable energy must be greatly expanded in industrialised countries both to substitute for fossil fuel and nuclear generation and to create the necessary economies of scale necessary for global expansion. Within the Energy [R]evolution Scenario we assume that modern renewable energy sources, such as solar collectors, solar cookers and modern forms of bio energy, will replace inefficient, traditional biomass use.


scenarios for a future energy supply | BACKGROUND

Moving from principles to action on energy supply and climate change mitigation requires a long-term perspective. Energy infrastructure takes time to build up; new energy technologies take time to develop. Policy shifts often also need many years to have an effect. Any analysis that seeks to tackle energy and environmental
5 issues therefore needs to look ahead at least half a century.
Scenarios are important in describing possible development paths, to give decision-makers an overview of future perspectives and to indicate how far they can shape the future energy system. Two different scenarios are used here to characterise the wide range of possible paths for the future energy supply system: a Reference Scenario, reflecting a continuation of current trends and policies, and the Energy [R]evolution Scenario, which is designed to achieve a set of dedicated environmental policy targets.
The reference scenario is based on the Reference Scenario published by the International Energy Agency in World Energy Outlook 2007 (WEO 2007)18. This only takes existing international energy and environmental policies into account. The assumptions include, for example, continuing progress in electricity and gas market reforms, the liberalisation of cross-border energy trade and recent policies designed to combat environmental pollution. The Reference Scenario does not include additional policies to reduce greenhouse gas emissions. As the IEA's scenario only covers a time horizon up to 2030, it has been extended by extrapolating its key macroeconomic indicators. This provides a baseline for comparison with the Energy [R]evolution Scenario.
The energy [r]evolution scenario has a key target for the reduction of worldwide carbon dioxide emissions down to a level of around 10 Gigatonnes per year by 2050 in order for the increase in global temperature to remain under +2°C. A second objective is the global phasing out of nuclear energy. To achieve these targets, the scenario is characterised by significant efforts to fully exploit the large potential for energy efficiency. At the same time, all costeffective renewable energy sources are used for heat and electricity generation as well as the production of bio fuels. The general framework parameters for population and GDP growth remain unchanged from the Reference Scenario.
These scenarios by no means claim to predict the future; they simply describe two potential development paths out of the broad range of possible `futures'. The Energy [R]evolution Scenario is designed to indicate the efforts and actions required to achieve its ambitious objectives and to illustrate the options we have at hand to change our energy supply system into one that is sustainable.

scenario background The scenarios in this report were jointly commissioned by Greenpeace and the European Renewable Energy Council from the Institute of Technical Thermodynamics, part of the German Aerospace Center (DLR). The supply scenarios were calculated using the MESAP/PlaNet simulation model used for the previous Energy [R]evolution study19. Energy demand projections were developed by Ecofys Netherlands, based on an analysis of the future potential for energy efficiency measures. The biomass potential, using Greenpeace sustainability criteria, has been developed especially for this scenario by the German Biomass Research Centre. The future development pathway for car technologies is based on a special report produced in 2008 by the Institute of Vehicle Concepts, DLR for Greenpeace International.
energy efficiency study
The aim of the Ecofys study was to develop a low energy demand scenario for the period 2005 to 2050 for the IEA regions as defined in the World Energy Outlook report series. Calculations were made for each decade from 2010 onwards. Energy demand was split up into electricity and fuels. The sectors which were taken into account were industry, transport and other consumers, including households and services.
Under the low energy demand scenario, worldwide final energy demand is reduced by 38% in 2050 in comparison to the Reference Scenario, resulting in a final energy demand of 350 EJ (ExaJoules). The energy savings are fairly equally distributed over the three sectors of industry, transport and other uses. The most important energy saving options are efficient passenger and freight transport and improved heat insulation and building design. Chapter 11 provides more details about this study.

"moving from principles to action.."

the future for cars
The Institute of Vehicle Concepts in Stuttgart, Germany has developed a global scenario for cars covering ten world regions. The aim was to produce a demanding but feasible scenario to lower global car CO2 emissions within the context of the overall objectives of this report. The approach takes into account a vast range of technical measures to reduce the energy consumption of vehicles, but also considers the dramatic increase in vehicle ownership and annual mileage taking place in developing countries. The major parameters are vehicle technology, alternative fuels, changes in sales of different vehicle sizes (segment split) and changes in vehicle kilometres travelled (modal split).
The scenario assumes that a large share of renewable electricity will be available in the future. A combination of ambitious efforts towards higher efficiency in vehicle technologies, a major switch to grid-connected electric vehicles and incentives for vehicle users to save carbon dioxide lead to the conclusion that it is possible to reduce CO2 emissions from `well-to-wheel' in 2050 by roughly 25%20 compared to 1990 and 40% compared to 2005.

By 2050, 60% of the final energy used in transport will still come

from fossil sources, mainly gasoline and diesel. Renewable

electricity will cover 25%, bio fuels 13% and hydrogen 2%. Total

energy consumption in 2050 will be similar to the consumption in

2005, however, in spite of enormous increases in fuel use in some

regions of the world.

5

The peak in global CO2 emissions from transport occurs between 2010 and 2015. From 2010 onwards, new legislation in the US and Europe will contribute to breaking the upwards trend in emissions. From 2020, the effect of introducing grid-connected electric cars can be clearly seen. Chapter 13 provides more details about this report.

the global potential for sustainable bio energy
As part of the Energy [R]evolution Scenario, Greenpeace commissioned the German Biomass Research Centre (the former Institute for Energy and Environment) to look at the worldwide potential for energy crops up to 2050. A summary of this report can be found in Chapter 8.

references 20 THERE IS NO RELIABLE NUMBER AVAILABLE FOR GLOBAL LDV EMISSIONS IN 1990, SO A ROUGH ESTIMATE HAS BEEN MADE.
main scenario assumptions
Development of a global energy scenario requires the use of a multiregion model in order to reflect the significant structural differences between energy supply systems. The International Energy Agency
5 breakdown of world regions, as used in the ongoing series of World
Energy Outlook reports, has been chosen because the IEA also provides the most comprehensive global energy statistics21.

The previous Energy [R]evolution Scenario used three regions to cover Asia: East Asia, South Asia and China. In line with WEO 2007, this new edition maintains the three region approach, but assesses China and India separately and aggregates the remaining Non-OECD countries in Asia under `Developing Asia'. The loss of comparability with the previous study is outweighed by the ability to compare the new results with current IEA reports and still provides a reasonable analysis of Asia in terms of population and economic development. The definitions of the world regions are shown in Figure 5.1.


1. population development
One important underlying factor in energy scenario building is future population development. Population growth affects the size and composition of energy demand, directly and through its impact on economic growth and development. World Energy Outlook 2007 uses the United Nations Development Programme (UNDP) projections for population development. For this study the most recent population projections from UNDP up to 2050 are applied22.
Table 5.1 summarises this study's assumptions on world population development.The world's population is expected to grow by 0.77 % on average over the period 2005 to 2050, from 6.5 billion people in 2005 to more than 9.1 billion in 2050. Population growth will slow over the projection period, from 1.2% during 2005-2010 to 0.4% during 20402050. However, the updated projections show an increase in population of almost 300 million compared to the previous edition.This will further increase the demand for energy. The population of the developing regions will continue to grow most rapidly.The Transition Economies will face a continuous decline, followed after a short while by the OECD Pacific countries. OECD Europe and OECD North America are expected to maintain their population, with a peak in around 2020/2030 and a slight decline afterwards. The share of the population living in today's NonOECD countries will increase from the current 82% to 86% in 2050. China's contribution to world population will drop from 20% today to 15% in 2050. Africa will remain the region with the highest growth rate, leading to a share of 21% of world population in 2050.
Satisfying the energy needs of a growing population in the developing regions of the world in an environmentally friendly manner is a key challenge for achieving a global sustainable energy supply.
2. economic growth
Economic growth is a key driver for energy demand. Since 1971, each 1% increase in global Gross Domestic Product (GDP) has been accompanied by a 0.6% increase in primary energy consumption.The decoupling of energy demand and GDP growth is therefore a prerequisite for reducing demand in the future. Most global energy/economic/ environmental models constructed in the past have relied on market exchange rates to place countries in a common currency for estimation and calibration.This approach has been the subject of considerable discussion in recent years, and the alternative of purchasing power parity (PPP) exchange rates has been proposed. Purchasing power parities compare the costs in different currencies of a fixed basket of traded and non-traded goods and services and yield a widely-based measure of the standard of living.This is important in analysing the main drivers of energy demand or for comparing energy intensities among countries.
Although PPP assessments are still relatively imprecise compared to statistics based on national income and product trade and national price indexes, they are considered to provide a better basis for global scenario development.23 Thus all data on economic development in WEO 2007 refers to purchasing power adjusted GDP. However, as WEO 2007 only covers the time period up to 2030, the projections for 2030-2050 are based on our own estimates.
references 21 `ENERGY BALANCE OF NON-OECD COUNTRIES' AND `ENERGY BALANCE OF OECD COUNTRIES', IEA, 2007 22 `WORLD POPULATION PROSPECTS: THE 2006 REVISION', UNITED NATIONS, POPULATION DIVISION, DEPARTMENT OF ECONOMIC AND SOCIAL AFFAIRS (UNDP), 2007 23 NORDHAUS, W, `ALTERNATIVE MEASURES OF OUTPUT IN GLOBAL ECONOMICENVIRONMENTAL MODELS: PURCHASING POWER PARITY OR MARKET EXCHANGE RATES?', REPORT PREPARED FOR IPCC EXPERT MEETING ON EMISSION SCENARIOS, USEPA WASHINGTON DC, JANUARY 12-14, 2005

scenarios for a future energy supply | MAIN SCENARIO ASSUMPTIONS

Prospects for GDP growth have increased considerably compared to

the previous study, whilst underlying growth trends continue much the

same. GDP growth in all regions is expected to slow gradually over the

coming decades. World GDP is assumed to grow on average by 3.6%

per year over the period 2005-2030, compared to 3.3% from 1971 to

2002, and on average by 3.3 % per year over the entire modelling

5

period. China and India are expected to grow faster than other

regions, followed by the Developing Asia countries, Africa and the

Transition Economies. The Chinese economy will slow as it becomes

more mature, but will nonetheless become the largest in the world in

PPP terms early in the 2020s. GDP in OECD Europe and OECD

Pacific is assumed to grow by around 2% per year over the projection

period, while economic growth in OECD North America is expected to

be slightly higher. The OECD share of global PPP-adjusted GDP will

decrease from 55% in 2005 to 29% in 2050.


OECD EUROPE
· OECD NORTH AMERICA · OECD PACIFIC · TRANSITION ECONOMIES · INDIA · CHINA · DEVELOPING ASIA · LATIN AMERICA · AFRICA ·· MIDDLE EAST

3. fossil fuel and biomass price projections
The recent dramatic increase in global oil prices has resulted in much higher forward price projections for fossil fuels. Under the 2004 `high oil and gas price' scenario from the European Commission, for example, an oil price of just $34 per barrel was assumed in 2030. More recent projections of oil prices in 2030 range from the IEA's $200662/bbl ($200560/bbl) (WEO 2007) up to $2006119/bbl ($2005115/bbl) in the `high price' scenario of the US Energy Information Administration's Annual Energy Outlook 2008.

Since the last Energy [R]evolution study was published, however, the price of oil has moved over $100/bbl for the first time (at the end of 2007), and in July 2008 reached a record high of more than $140/bbl. Although oil prices fell back to $100/bbl in September 2008, the above projections might still be considered too conservative. Considering the growing global demand for oil and gas we have assumed a price development path for fossil fuels in which the price of oil reaches $120/bbl by 2030 and $140/bbl in 2050.
As the supply of natural gas is limited by the availability of pipeline infrastructure, there is no world market price for natural gas. In most regions of the world the gas price is directly tied to the price of oil. Gas prices are assumed to increase to $20-25/GJ by 2050.

4. cost of CO2 emissions
Assuming that a CO2 emissions trading system is established in all world regions in the long term, the cost of CO2 allowances needs to be included in the calculation of electricity generation costs. Projections of emissions costs are even more uncertain than energy prices, and available studies span a broad range of future CO2 cost estimates. As in the previous Energy [R]evolution study we assume CO2 costs of $10/tCO2 in 2010, rising to $50/tCO2 in 2050. Additional CO2 costs are applied in Kyoto Protocol Non-Annex B (developing) countries only after 2020.



5. power plant investment costs
fossil fuel technologies and carbon capture and storage (CCS) While the fossil fuel power technologies in use today for coal, gas, lignite and oil are established and at an advanced stage of market development, further cost reduction potentials are assumed. The potential for cost reductions is limited, however, and will be achieved mainly through an increase in efficiency, bringing down investment costs24.
There is much speculation about the potential for carbon capture and storage (CCS) technology to mitigate the effect of fossil fuel consumption on climate change, even though the technology is still under development.
CCS is a means of trapping CO2 from fossil fuels, either before or after they are burned, and `storing' (effectively disposing of) it in the sea or beneath the surface of the Earth. There are currently three different methods of capturing CO2: `pre-combustion', `postcombustion' and `oxyfuel combustion'. However, development is at a very early stage and CCS will not be implemented - in the best case - before 2020 and will probably not become commercially viable as a possible effective mitigation option until 2030.
Cost estimates for CCS vary considerably, depending on factors such as power station configuration, technology, fuel costs, size of project and location. One thing is certain, however, CCS is expensive. It requires significant funds to construct the power stations and the necessary infrastructure to transport and store carbon. The IPCC assesses costs at $15-75 per ton of captured CO225, while a recent US Department of Energy report found installing carbon capture systems to most modern plants resulted in a near doubling of costs26. These costs are estimated to increase the price of electricity in a range from 21-91%27.

Pipeline networks will also need to be constructed to move CO2 to storage sites. This is likely to require a considerable outlay of capital28. Costs will vary depending on a number of factors, including pipeline length, diameter and manufacture from corrosion-resistant steel, as well as the volume of CO2 to be
transported. Pipelines built near population centres or on difficult 5
terrain, such as marshy or rocky ground, are more expensive29.
The IPCC estimates a cost range for pipelines of $1-8/ton of CO2 transported. A United States Congressional Research Services report calculated capital costs for an 11 mile pipeline in the Midwestern region of the US at approximately $6 million. The same report estimates that a dedicated interstate pipeline network in North Carolina would cost upwards of $5 billion due to the limited geological sequestration potential in that part of the country30. Storage and subsequent monitoring and verification costs are estimated by the IPCC to range from $0.5-8/tCO2 injected and $0.1-0.3/tCO2 injected, respectively. The overall cost of CCS could therefore serve as a major barrier to its deployment31.
For the above reasons, CCS power plants are not included in our financial analysis.
Table 5.4 summarises our assumptions on the technical and economic parameters of future fossil-fuelled power plant technologies. In spite of growing raw material prices, we assume that further technical innovation will result in a moderate reduction of future investment costs as well as improved power plant efficiencies. These improvements are, however, outweighed by the expected increase in fossil fuel prices, resulting in a significant rise in electricity generation costs.


scenarios for a future energy supply | MAIN SCENARIO ASSUMPTIONS

6. cost projections for renewable energy technologies
The range of renewable energy technologies available today display marked differences in terms of their technical maturity, costs and development potential. Whereas hydro power has been widely used
5 for decades, other technologies, such as the gasification of biomass,
have yet to find their way to market maturity. Some renewable sources by their very nature, including wind and solar power, provide a variable supply, requiring a revised coordination with the grid network. But although in many cases these are `distributed' technologies - their output being generated and used locally to the consumer - the future will also see large-scale applications in the form of offshore wind parks, photovoltaic power plants or concentrating solar power stations.
By using the individual advantages of the different technologies, and linking them with each other, a wide spectrum of available options can be developed to market maturity and integrated step by step into the existing supply structures. This will eventually provide a complementary portfolio of environmentally friendly technologies for heat and power supply and the provision of transport fuels.
Many of the renewable technologies employed today are at a relatively early stage of market development. As a result, the costs of electricity, heat and fuel production are generally higher than those of competing conventional systems - a reminder that the external (environmental and social) costs of conventional power production are not included in the market prices. It is expected, however, that compared with conventional technologies large cost reductions can be achieved through technical advances, manufacturing improvements and large-scale production. Especially when developing long-term scenarios spanning periods of several decades, the dynamic trend of cost developments over time plays a crucial role in identifying economically sensible expansion strategies.

To identify long-term cost developments, learning curves have been applied which reflect the correlation between cumulative production volumes of a particular technology and a reduction in its costs. For many technologies, the learning factor (or progress ratio) falls in the range between 0.75 for less mature systems to 0.95 and higher for well-established technologies. A learning factor of 0.9 means that costs are expected to fall by 10% every time the cumulative output from the technology doubles. Empirical data shows, for example, that the learning factor for PV solar modules has been fairly constant at 0.8 over 30 years whilst that for wind energy varies from 0.75 in the UK to 0.94 in the more advanced German market.
Assumptions on future costs for renewable electricity technologies in the Energy [R]evolution Scenario are derived from a review of learning curve studies, for example by Lena Neij and others32, from the analysis of recent technology foresight and road mapping studies, including the European Commission funded NEEDS (New Energy Externalities Developments for Sustainability)33 project or the IEA Energy Technology Perspectives 2008, and a discussion with experts from the renewable energy industry.

"large cost reductions can be achieved through technical advances, manufacturing improvements and large-scale production."

photovoltaics (pv)
The worldwide photovoltaics (PV) market has been growing at over 35% per annum in recent years and the contribution it can make to electricity generation is starting to become significant. Development work is focused on improving existing modules and system components by increasing their energy efficiency and reducing material usage. Technologies like PV thin film (using alternative semiconductor materials) or dye sensitive solar cells are developing quickly and present a huge potential for cost reduction. The mature technology crystalline silicon, with a proven lifetime of 30 years, is continually increasing its cell and module efficiency (by 0.5% annually), whereas the cell thickness is rapidly decreasing (from 230 to 180 microns over the last five years). Commercial module efficiency varies from 14 to 21% depending on silicon quality and fabrication process.
The learning factor for PV modules has been fairly constant over the last 30 years, with a cost reduction of 20% each time the installed capacity doubles, indicating a high rate of technical learning. Assuming a globally installed capacity of 1,600 GW by between 2030 and 2040, and with an electricity output of 2,600 TWh, we can expect that generation costs of around 5-10 cents/kWh (depending on the region) will be achieved. During the following five to ten years, PV will become competitive with retail electricity prices in many parts of the world and competitive with fossil fuel costs by 2050. The importance of photovoltaics comes from its decentralised/ centralised character, its flexibility for use in an urban environment and huge potential for cost reduction.

concentrating solar power (csp)

Solar thermal `concentrating' power stations (CSP) can only use

direct sunlight and are therefore dependent on high irradiation

locations. North Africa, for example, has a technical potential

which far exceeds local demand. The various solar thermal

5

technologies (parabolic trough, power towers and parabolic dish

concentrators) offer good prospects for further development and

cost reductions. Because of their more simple design, `Fresnel'

collectors are considered as an option for additional cost reduction.

The efficiency of central receiver systems can be increased by

producing compressed air at a temperature of up to 1,000°C, which

is then used to run a combined gas and steam turbine.

Thermal storage systems are a key component for reducing CSP electricity generation costs. The Spanish Andasol 1 plant, for example, is equipped with molten salt storage with a capacity of 7.5 hours. A higher level of full load operation can be realised by using a thermal storage system and a large collector field. Although this leads to higher investment costs, it reduces the cost of electricity generation.

Depending on the level of irradiation and mode of operation, it is expected that long term future electricity generation costs of 6-10 cents/kWh can be achieved. This presupposes rapid market introduction in the next few years.

scenarios for a future energy supply | MAIN SCENARIO ASSUMPTIONS


scenarios for a future energy supply | MAIN SCENARIO ASSUMPTIONS

wind power
Within a short period of time, the dynamic development of wind power has resulted in the establishment of a flourishing global market. The world's largest wind turbines, several of which have
5 been installed in Germany, have a capacity of 6 MW. While
favourable policy incentives have made Europe the main driver for the global wind market, in 2007 more than half of the annual market was outside Europe. This trend is likely to continue. The boom in demand for wind power technology has nonetheless led to supply constraints. As a consequence, the cost of new systems has stagnated or even increased. Because of the continuous expansion of production capacities, the industry expects to resolve the bottlenecks in the supply chain over the next few years. Taking into account market development projections, learning curve analysis and industry expectations, we assume that investment costs for wind turbines will reduce by 30% for onshore and 50% for offshore installations up to 2050.

biomass
The crucial factor for the economics of biomass utilisation is the cost of the feedstock, which today ranges from a negative cost for waste wood (based on credit for waste disposal costs avoided) through inexpensive residual materials to the more expensive energy crops. The resulting spectrum of energy generation costs is correspondingly broad. One of the most economic options is the use of waste wood in steam turbine combined heat and power (CHP) plants. Gasification of solid biomass, on the other hand, which opens up a wide range of applications, is still relatively expensive. In the long term it is expected that favourable electricity production costs will be achieved by using wood gas both in micro CHP units (engines and fuel cells) and in gas-and-steam power plants. Great potential for the utilisation of solid biomass also exists for heat generation in both small and large heating centres linked to local heating networks. Converting crops into ethanol and `bio diesel' made from rapeseed methyl ester (RME) has become increasingly important in recent years, for example in Brazil, the USA and Europe. Processes for obtaining synthetic fuels from biogenic synthesis gases will also play a larger role.
A large potential for exploiting modern technologies exists in Latin and North America, Europe and the Transition Economies, either in stationary appliances or the transport sector. In the long term Europe and the Transition Economies will realise 20-50% of the potential for biomass from energy crops, whilst biomass use in all the other regions will have to rely on forest residues, industrial wood waste and straw. In Latin America, North America and Africa in particular, an increasing residue potential will be available.
In other regions, such as the Middle East and all Asian regions, the additional use of biomass is restricted, either due to a generally low availability or already high traditional use. For the latter, using modern, more efficient technologies will improve the sustainability of current usage and have positive side effects, such as reducing indoor pollution and the heavy workloads currently associated with traditional biomass use.


geothermal
Geothermal energy has long been used worldwide for supplying heat, and since the beginning of the last century for electricity generation as well. Geothermally generated electricity was previously limited to sites with specific geological conditions, but further intensive research and development work has enabled the potential areas to be widened. In particular the creation of large underground heat exchange surfaces (Enhanced Geothermal Systems - EGS) and the improvement of low temperature power conversion, for example with the Organic Rankine Cycle, open up the possibility of producing geothermal electricity anyywhere. Advanced heat and power cogeneration plants will also improve the economics of geothermal electricity.
As a large part of the costs for a geothermal power plant come from deep underground drilling, further development of innovative drilling technology is expected. Assuming a global average market growth for geothermal power capacity of 9% per year up to 2020, adjusting to 4% beyond 2030, the result would be a cost reduction potential of 50% by 2050:
· for conventional geothermal power, from 7 cents/kWh to about 2 cents/kWh.
· for EGS, despite the presently high figures (about 20 cents/kWh), electricity production costs - depending on the payments for heat supply - are expected to come down to around 5 cents/kWh in the long term.
Because of its non-fluctuating supply and a grid load operating almost 100% of the time, geothermal energy is considered to be a key element in a future supply structure based on renewable sources. Until now we have just used a marginal part of the geothermal heating and cooling potential. Shallow geothermal drilling makes possible the delivery of heating and cooling at any time anywhere, and can be used for thermal energy storage.

ocean energy
Ocean energy, particularly offshore wave energy, is a significant resource, and has the potential to satisfy an important percentage of electricity supply worldwide. Globally, the potential of ocean energy
has been estimated at around 90,000 TWh/year. The most significant 5
advantages are the vast availability and high predictability of the resource and a technology with very low visual impact and no CO2 emissions. Many different concepts and devices have been developed, including taking energy from the tides, waves, currents and both thermal and saline gradient resources. Many of them are in an advanced phase of R&D, large scale prototypes have been deployed in real sea conditions and some have reached pre-market deployment. There are a few grid connected, fully operational commercial wave and tidal generating plants.
The cost of energy from initial tidal and wave energy farms has been estimated to be in the range of 15-55 cents/kWh, and for initial tidal stream farms in the range of 11-22 cents/kWh. Generation costs of 10-25 cents/kWh are expected by 2020. Key areas for development will include concept design, optimisation of the device configuration, reduction of capital costs by exploring the use of alternative structural materials, economies of scale and learning from operation. According to the latest research findings, the learning factor is estimated to be 10-15% for offshore wave and 5-10% for tidal stream. In the medium term, ocean energy has the potential to become one of the most competitive and cost effective forms of generation. In the next few years a dynamic market penetration is expected, following a similar curve to wind energy.
Because of the early development stage any future cost estimates for ocean energy systems are uncertain, and no learning curve data is available. Present cost estimates are based on analysis from the European NEEDS project34.

scenarios for a future energy supply | MAIN SCENARIO ASSUMPTIONS



hydro power
Hydropower is a mature technology with a significant part of its potential already exploited. There is still, however, some potential left both for new schemes (especially small scale run-of-river
5 projects with little or no reservoir impoundment) and for
repowering of existing sites. The significance of hydropower is also likely to be encouraged by the increasing need for flood control and maintenance of water supply during dry periods. The future is in sustainable hydropower which makes an effort to integrate plants with river ecosystems while reconciling ecology with economically attractive power generation.

summary of renewable energy cost development
Figure 5.4 summarises the cost trends for renewable energy technologies as derived from the respective learning curves. It should be emphasised that the expected cost reduction is basically not a function of time, but of cumulative capacity, so dynamic market development is required. Most of the technologies will be able to reduce their specific investment costs to between 30% and 70% of current levels by 2020, and to between 20% and 60% once they have achieved full development (after 2040).
Reduced investment costs for renewable energy technologies lead directly to reduced heat and electricity generation costs, as shown in Figure 5.5. Generation costs today are around 8 to 25 cents/kWh (10-25 $cents/kWh) for the most important technologies, with the exception of photovoltaics. In the long term, costs are expected to converge at around 4 to 10 cents/kWh (5-12 $cents/kWh). These estimates depend on site-specific conditions such as the local wind regime or solar irradiation, the availability of biomass at reasonable prices or the credit granted for heat supply in the case of combined heat and power generation.


The development of future global energy demand is determined by three key factors:
6 · Population development: the number of people consuming energy
or using energy services.
· Economic development, for which Gross Domestic Product (GDP) is the most commonly used indicator. In general, an increase in GDP triggers an increase in energy demand.
· Energy intensity: how much energy is required to produce a unit of GDP.
Both the Reference and Energy [R]evolution Scenarios are based on the same projections of population and economic development. The future development of energy intensity, however, differs between the two, taking into account the measures to increase energy efficiency under the Energy [R]evolution Scenario.

global: projection of energy intensity
An increase in economic activity and a growing population does not necessarily have to result in an equivalent increase in energy demand. There is still a large potential for exploiting energy efficiency measures. Under the Reference Scenario, we assume that energy intensity will be reduced by 1.25% on average per year, leading to a reduction in final energy demand per unit of GDP of about 56% between 2005 and 2050. Under the Energy [R]evolution Scenario, it is assumed that active policy and technical support for energy efficiency measures will lead to an even higher reduction in energy intensity of almost 73%.

global: development of energy demand by sector
Combining the projections on population development, GDP growth and energy intensity results in future development pathways for the world's energy demand. These are shown in Figure 6.4 for both the Reference and Energy [R]evolution Scenarios. Under the Reference Scenario, total primary energy demand almost doubles from 474,900 PJ/a in 2005 to 867,700 PJ/a in 2050. In the Energy [R]evolution Scenario, demand increases up to 2015 by 16% and decreases to close to today's level of 480,860 PJ in 2050.

The accelerated increase in energy efficiency, which is a crucial prerequisite for achieving a sufficiently large share of renewable energy sources in our energy supply, is beneficial not only for the environment but also for economics. Taking into account the full service life, in most cases the implementation of energy efficiency measures saves costs compared to an additional energy supply. The mobilisation of cost-effective energy saving potential leads directly
to a reduction in costs. A dedicated energy efficiency strategy thus 6
also helps to compensate in part for the additional costs required during the market introduction phase of renewable energy sources.
Under the Energy [R]evolution Scenario, electricity demand is expected to increase disproportionately, with households and services the main source of growing consumption (see Figure 6.5). With the exploitation of efficiency measures, however, an even higher increase can be avoided, leading to electricity demand of around 30,800 TWh/a in the year 2050. Compared to the Reference Scenario, efficiency measures avoid the generation of about 12,800 TWh/a.This reduction in energy demand can be achieved in particular by introducing highly efficient electronic devices using the best available technology in all demand sectors. Employment of solar architecture in both residential and commercial buildings will help to curb the growing demand for active air-conditioning.
Efficiency gains in the heat supply sector are even larger. Under the Energy [R]evolution Scenario, final demand for heat supply can even be reduced

(see Figure 6.6). Compared to the Reference Scenario, consumption equivalent to 46,000 PJ/a is avoided through efficiency gains by 2050. As a result of energy-related renovation of the existing stock of residential buildings, as well as the introduction of low energy standards and `passive houses' for new buildings, enjoyment of the same comfort and energy services will be accompanied by a much lower future energy demand.
In the transport sector, it is assumed under the Energy [R]evolution Scenario that energy demand will increase by 12 % to around 94,000 PJ/a in 2015 and will fall slightly afterwards down to 83,300 PJ/a in 2050, saving 100,000 PJ compared to the Reference Scenario. This reduction can be achieved by the introduction of highly efficient vehicles, by shifting the transport of goods from road to rail and by changes in mobility-related behaviour patterns.


key results | GLOBAL - ELECTRICITY GENERATION

The development of the electricity supply sector is characterised by a

6

dynamically growing renewable energy market and an increasing share of renewable electricity. This will compensate for the phasing out of

nuclear energy and reduce the number of fossil fuel-fired power plants

required for grid stabilisation. By 2050, 77% of the electricity

produced worldwide will come from renewable energy sources.

`New' renewables ­ mainly wind, solar thermal energy and PV ­ will

contribute over 60% of electricity generation. The following strategy

paves the way for a future renewable energy supply:

· The phasing out of nuclear energy and rising electricity demand will be met initially by bringing into operation new highly efficient gas-fired combined-cycle power plants, plus an increasing capacity of wind turbines, biomass, concentrating solar power plants and solar photovoltaics. In the long term, wind will be the most important single source of electricity generation.

· Solar energy, hydro and biomass will make substantial contributions to electricity generation. In particular, as non-fluctuating renewable energy sources, hydro and solar thermal, combined with efficient heat storage, are important elements in the overall generation mix.

· The installed capacity of renewable energy technologies will grow from the current 1,000 GW to 9,100 GW in 2050. Increasing renewable capacity by a factor of nine within the next 42 years requires political support and well-designed policy instruments, however. There will be a considerable demand for investment in new production capacity over the next 20 years. As investment cycles in the power sector are long, decisions on restructuring the world's energy supply system need to be taken now.

To achieve an economically attractive growth in renewable energy sources, a balanced and timely mobilisation of all technologies is of great importance. This mobilisation depends on technical potentials, cost reduction and technological maturity. Figure 21 shows the comparative evolution of the different renewable technologies over time. Up to 2020, hydro-power and wind will remain the major contributors to the growing market share. After 2020, the continuing growth of wind will be complemented by electricity from biomass, photovoltaic and solar thermal (CSP) energy.

key results | GLOBAL - COSTS - HEATING & COOLING

global: future costs of electricity generation
Figure 27 shows that the introduction of renewable technologies under the Energy [R]evolution Scenario slightly increases the costs of electricity generation compared to the Reference Scenario. This difference will be less than 0.2 cents/kWh up to 2020. Note that any increase in fossil fuel prices beyond the projection given in Table 6.1 will reduce the gap between the two scenarios. Because of the lower CO2 intensity of electricity generation, by 2020 electricity generation costs will become economically favourable under the Energy [R]evolution Scenario, and by 2050 generation costs will be more than 5 cents/kWh below those in the Reference Scenario.
Due to growing demand, we face a significant increase in society's expenditure on electricity supply. Under the Reference Scenario, the unchecked growth in demand, the increase in fossil fuel prices and the cost of CO2 emissions result in total electricity supply costs rising from today's $1,750 billion per year to more than $7,300 bn in 2050. Figure 28 shows that the Energy [R]evolution Scenario not only complies with global CO2 reduction targets but also helps to stabilise energy costs and relieve the economic pressure on society. Increasing energy efficiency and shifting energy supply to renewables leads to long term costs for electricity supply that are one third lower than in the Reference Scenario. It becomes clear that pursuing stringent environmental targets in the energy sector also pays off in terms of economics.

global: heat and cooling supply

Development of renewables in the heat supply sector raises

different issues. Today, renewables provide 24%of primary energy

demand for heat supply, the main contribution coming from the use

of biomass. The lack of district heating networks is a severe

structural barrier to the large scale utilisation of geothermal and

solar thermal energy. Past experience shows that it is easier to

implement effective support instruments in the grid-connected

6

electricity sector than in the heat market, with its multitude of

different actors. Dedicated support instruments are required to

ensure a dynamic development.

In the Energy [R]evolution Scenario, renewables satisfy more than 70% of the total global heating demand in 2050.

· Energy efficiency measures can decrease the current per capita demand for heat supply by 30% in spite of improving living standards.

· For direct heating, solar collectors, biomass/biogas as well as geothermal energy will increasingly substitute for fossil fuel-fired systems.

· A shift from coal and oil to natural gas in the remaining conventional applications will lead to a further reduction of CO2 emissions.


key results | GLOBAL - TRANSPORT - CONSUMPTION - CO2 EMISSIONS

In the transport sector, it is assumed that under the Energy
6 [R]evolution Scenario, due to fast growing demand for services,
energy demand will further increase up to 2015. After that demand will decrease, falling to below its current level in 2050. Compared to the Reference Scenario, energy demand is reduced by 54%. This reduction can be achieved by the introduction of highly efficient vehicles, by shifting the transport of goods from road to rail and by changes in mobility-related behaviour patterns. By implementing attractive alternatives to individual cars, the amount of cars will grow more slowly than in the Reference Scenario. In 2050, electricity will provide 24% of the transport sector's total energy demand, while 61% of the demand will be covered by fossil fuels.
figure 6.12: global: transport under the two scenarios
(`EFFICIENCY' = REDUCTION COMPARED TO THE REFERENCE SCENARIO)
BIO FUELS
· NATURAL GAS ·· OIL PRODUCTS

Taking into account the assumptions discussed above, the resulting primary energy consumption under the Energy [R]evolution Scenario is shown in Figure 6.13. Compared to the Reference Scenario, overall energy demand will be reduced by almost 45% in 2050. More than half of the remaining demand will be covered by renewable energy sources. Note that because of the `efficiency method' used for the calculation of primary energy consumption, which postulates that the amount of electricity generation from hydro, wind, solar and geothermal energy equals the primary energy consumption, the share of renewables seems to be lower than their actual importance as energy suppliers.

development of global CO2 emissions
Whilst worldwide emissions of CO2 will almost double under the Reference Scenario, under the Energy [R]evolution Scenario they will decrease from 24,350 million tonnes in 2005 to 10,600 m/t in 2050. Annual per capita emissions will drop from 3.7 tonnes to 1.15 t. In spite of the phasing out of nuclear energy and increasing demand, CO2 emissions will decrease in the electricity sector. In the long run efficiency gains and the increased use of renewable electricity will even reduce CO2 emissions in the transport sector. With a share of 35% of total CO2 in 2050, the power sector will fall significantly but remain the largest source of emissions, followed by transport.

global: regional breakdown of CO2 emissions in 2050 global: CO2 emissions by source

With effective efficiency standards OECD countries can reduce

In 2050, coal will be by far the largest source of CO2, mainly

their per capita energy consumption significantly while developing from coal-fired power stations in China and India as well as power

countries could slow down their massive increase in energy demand. stations in other developing countries. Since those emissions are

At the same time renewable energy sources can increase there

mainly from power stations built between 2000 and 2015, and the

share in the energy mix to over 50 % globally. In some regions, the average lifetime of a coal-fired power plant is calculated at 40

renewable energy share will be well above 80%, while economic growth is still maintained over the entire scenario period.

years, in order to achieve the projected reduction, the construction
of new coal power stations must end across most of the world by 6


2015 and in developing countries by 2020. With this shift, annual per capita CO2 emissions will fall from their

current level of about 3.6 tonnes to 1.15 tonnes in 2050. OECD

The second biggest emitter is oil, mainly from the remaining oil

countries will be able to reduce their CO2 emissions by about 80%. used in the transport sector.

The Energy [R]evolution Scenario for the USA shows that it is

possible to reduce per capita CO2 emissions from 19 tonnes now to

3 tonnes by 2050. For the EU-27 countries, per capita emissions

will fall from 8 to just under 2 tonnes per capita. Developing

countries such as the Philippines could even keep per capita emissions at their current level of about 1 tonne of CO2 until 2050, while maintaining economic growth. A combination of efficiency standards and renewable energy development proves to be the most
regional breakdown of energy [r]evolution scenario The outcome of the Energy [R]evolution Scenario for each region of the world shows how the global pattern is adapted to regional circumstances in terms of predicted demand and the potential for developing different sources of future energy generation.
59

GLOBAL ENERGY [R]EVOLUTION A SUSTAINABLE GLOBAL ENERGY OUTLOOK

oecd north america

GLOBAL SCENARIO

OECD NORTH AMERICA LATIN AMERICA OECD EUROPE AFRICA

MIDDLE EAST TRANSITION ECONOMIES INDIA

DEVELOPING ASIA CHINA OECD PACIFIC

key results | OECD NORTH AMERICA - DEMAND

oecd north america: energy demand by sector
Combining the projections on population development, GDP growth
6 and energy intensity results in future development pathways for
North America's energy demand. These are shown in Figure 6.18 for both the Reference and Energy [R]evolution Scenarios. Under the Reference Scenario, total primary energy demand increases by more than 40% from the current 115,900 PJ/a to 164,300 PJ/a in 2050. In the Energy [R]evolution Scenario, primary energy demand decreases by 33% compared to current consumption and is expected by 2050 to reach 77,700 PJ/a.
Under the Energy [R]evolution Scenario, electricity demand is expected to decrease in the industry sector, but to grow in the transport as well as in the residential and service sectors (see Figure 6.19). Total electricity demand will rise to 5,730 TWh/a in the year 2050. Compared to the Reference Scenario, efficiency measures avoid the generation of about 2,460 TWh/a. This reduction in energy demand can be achieved in particular by introducing highly efficient electronic devices using the best available technology in all demand sectors. Employment of solar

architecture in both residential and commercial buildings will help to curb the growing demand for active air-conditioning.
Efficiency gains in the heat supply sector are even larger. Under the Energy [R]evolution Scenario, demand for heat supply will grow up to 2030, but after that can even be reduced to below the current level (see Figure 6.20). Compared to the Reference Scenario, consumption equivalent to 7,850 PJ/a is avoided through efficiency gains by 2050. As a result of energy-related renovation of the existing stock of residential buildings, as well as the introduction of low energy standards and `passive houses' for new buildings, enjoyment of the same comfort and energy services will be accompanied by a much lower future energy demand.
In the transport sector, it is assumed under the Energy [R]evolution Scenario that energy demand will decrease by half to 16,720 PJ/a by 2050, saving 65% compared to the Reference Scenario. This reduction can be achieved by the introduction of highly efficient vehicles, by shifting the transport of goods from road to rail and by changes in mobility-related behaviour patterns.

oecd north america: electricity generation
The development of the electricity supply sector is characterised by a dynamically growing renewable energy market and an increasing share of renewable electricity. This will compensate for the phasing out of nuclear energy and reduce the number of fossil fuel-fired power plants required for grid stabilisation. By 2050, 94% of the electricity produced in OECD North America will come from renewable energy sources. `New' renewables ­ mainly wind, solar thermal energy and PV ­ will contribute over 85% of electricity generation.
Figure 6.22 shows the comparative evolution of the different renewable technologies in OECD North America over time. Up to 2020, hydro-power and wind will remain the main contributors to the growing market share. After 2020, the continuing growth of wind will be complemented by electricity from biomass, photovoltaics and solar thermal (CSP) energy.


oecd north america: future costs of electricity generation
Figure 6.23 shows that the introduction of renewable technologies
6 under the Energy [R]evolution Scenario slightly increases the costs
of electricity generation compared to the Reference Scenario. This difference will be less than 0.4 cents/kWh up to 2020. Because of the lower CO2 intensity of electricity generation, by 2020 electricity generation costs will become economically favourable under the Energy [R]evolution Scenario, and by 2050 generation costs will be more than 5 cents/kWh below those in the Reference Scenario.
Under the Reference Scenario, on the other hand, unchecked growth in demand, the increase in fossil fuel prices and the cost of CO2 emissions result in total electricity supply costs rising from today's $420 billion per year to more than $1,350 bn in 2050. Figure 6.24 shows that the Energy [R]evolution Scenario not only complies with OECD North America CO2 reduction targets but also helps to stabilise energy costs and relieve the economic pressure on society. Increasing energy efficiency and shifting energy supply to renewables leads to long term costs for electricity supply that are one third lower than in the Reference Scenario.

oecd north america: heat and cooling supply
Today, renewables provide 11% of North America's primary energy demand for heat supply, the main contribution coming from the use of biomass. The lack of district heating networks is a severe structural barrier to the large scale utilisation of geothermal and solar thermal energy. Dedicated support instruments are required to ensure a dynamic development.
In the Energy [R]evolution Scenario, renewables provide 69% of North America's total heating demand in 2050.
· Energy efficiency measures help to reduce the currently growing demand for heating and cooling, in spite of improving living standards.
· For direct heating, solar collectors, biomass/biogas as well as geothermal energy are increasingly substituting for fossil fuelfired systems.
· A shift from coal and oil to natural gas in the remaining conventional applications will lead to a further reduction of CO2 emissions.
oecd north america: transport
A key initiative in North America is to introduce incentives to drive smaller cars, which today are virtually non-existant. In addition, a shift to efficient modes of transport like rail, light rail and bus is important, especially in the expanding large metropolitan areas. Together with the rising price of fossil fuels, these changes reduce the huge growth in car sales projected by the Reference Scenario. In the Energy [R]evolution Scenario, the car fleet still grows by 20% from the year 2000 to 2050. However the energy demand of the transport sector is reduced by 47%. Highly efficient propulsion technology, including hybrid, plug-in hybrid and battery-electric powertrains, will bring large efficiency gains. A quarter of the transport energy demand by 2050 is covered by electricity, 30% by bio fuels.


oecd north america: development of CO2 emissions
Whilst North America's emissions of CO2 will increase by 42% under the Reference Scenario, under the Energy [R]evolution Scenario they will decrease from 6,430 million tonnes in 2005 to 1,060 m/t in 2050. Annual per capita emissions will drop from 14.7 tonnes to 1.8 t. In spite of the phasing out of nuclear energy and increasing demand, CO2 emissions will decrease in the electricity sector. In the long run efficiency gains and the increased use of renewable electricity in the transport sector will even reduce CO2 emissions there. With a share of 46% of total CO2, the transport sector will be the largest source of emissions in 2050.

latin america: energy demand by sector
Combining the projections on population development, GDP growth
6 and energy intensity results in future development pathways for
Latin America's energy demand. These are shown in Figure 6.29 for both the Reference and Energy [R]evolution Scenarios. Under the Reference Scenario, total primary energy demand more than doubles from the current 21,140 PJ/a to 52,300 PJ/a in 2050. In the Energy [R]evolution Scenario, a smaller 54% increase on current consumption is expected by 2050, reaching 32,500 PJ/a.
Under the Energy [R]evolution Scenario, electricity demand is expected to increase disproportionately, with households and services the main source of growing consumption. This is due to wider access to energy services in developing countries (see Figure 6.30). With the exploitation of efficiency measures, however, an even higher increase

can be avoided, leading to electricity demand of around 2,150 TWh/a in 2050. Compared to the Reference Scenario, efficiency measures avoid the generation of about 660 TWh/a. This reduction can be achieved in particular by introducing highly efficient electronic devices. Employment of solar architecture in both residential and commercial buildings will help to curb the growing demand for air-conditioning.
Efficiency gains in the heat supply sector are even larger. Under the Energy [R]evolution Scenario, final demand for heat supply can even be reduced (see Figure 6.31). Compared to the Reference Scenario, consumption equivalent to 2,400 PJ/a is avoided through efficiency gains by 2050. In the transport sector, it is assumed under the Energy [R]evolution Scenario that energy demand will increase by a fifth to 6,100 PJ/a by 2050, saving 50% compared to the Reference Scenario.


latin america: electricity generation
The development of the electricity supply sector is characterised by an increasing share of renewable electricity. By 2050, 95% of the electricity produced in Latin America will come from renewable energy sources. `New' renewables ­ mainly wind, solar thermal energy and PV ­ will contribute more than 60% of electricity generation. The installed capacity of renewable energy technologies will grow from the current 139 GW to 695 GW in 2050 - increasing renewable capacity by a factor of five within the next 42 years.
Figure 6.33 shows the comparative evolution of the different renewable technologies over time. Up to 2020, hydro-power and wind will remain the main contributors to the growing market share. After 2020, the continuing growth of wind will be complemented by electricity from biomass, photovoltaics and solar thermal (CSP) energy.

latin america: future costs of electricity generation
Figure 6.34 shows that the introduction of renewable technologies
6 under the Energy [R]evolution Scenario significantly decreases the
future costs of electricity generation compared to the Reference Scenario. Because of the lower CO2 intensity of electricity generation, costs will become economically favourable under the Energy [R]evolution Scenario. By 2050 generation costs will be more than 8 cents/kWh below those in the Reference Scenario.
Under the Reference Scenario, on the other hand, unchecked growth in demand, the increase in fossil fuel prices and the cost of CO2 emissions result in total electricity supply costs rising from today's $70 billion per year to more than $551 bn in 2050. Figure 6.35 shows that the Energy [R]evolution Scenario not only complies with Latin America's CO2 reduction targets but also helps to stabilise energy costs and relieve the economic pressure on society. Increasing energy efficiency and shifting energy supply to renewables leads to long term costs for electricity supply that are one third lower than in the Reference Scenario.

latin america: heat and cooling supply
Today, renewables provide around 40% of primary energy demand for heat supply in Latin America, the main contribution coming from the use of biomass. The availability of less efficient but cheap appliances is a severe structural barrier to efficiency gains. Large-scale utilisation of geothermal and solar thermal energy for heat supply will be largely restricted to the industrial sector.
In the Energy [R]evolution Scenario, renewables provide 83% of Latin America's total heating and cooling demand in 2050.
· Energy efficiency measures restrict the future primary energy demand for heat and cooling supply to a 60% increase, in spite of improving living standards.
· In the industry sector solar collectors, biomass/biogas as well as geothermal energy are increasingly replacing conventional fossil fuel-fired heating systems.
· A shift from coal and oil to natural gas in the remaining conventional applications leads to a further reduction of CO2 emissions.

figure 6.34: latin america: development of specific electricity generation costs under the two scenarios
latin america: primary energy consumption

Despite a huge growth in services, the increase in energy consumption Taking into account the assumptions discussed above, the resulting

in the transport sector by 2050 can be limited to 19% under the

primary energy consumption under the Energy [R]evolution

6

Energy [R]evolution Scenario. Current 90% dependency on fossil fuels Scenario is shown in Figure 6.38. Compared to the Reference

is transformed into a 30% contribution from bio fuels and 22% from Scenario, overall energy demand will be reduced by about 38% in

electricity.The market for cars will grow by a factor of five less than in 2050. Latin America's energy demand will increase from 21,000

the Reference Scenario. Measures are taken to keep the car sales split PJ/a to 32,500 PJ/a. Around 70% of this will be covered by

by segment like its present breakdown, with one third represented by

renewable energy sources.

medium-sized vehicles and more than half by small vehicles.

Technological progress increases the share of hybrid vehicles to 65% in

2050. Incentives to use more efficient transport modes reduces vehicle

kilometre travelled to in average 11.000 km per annum.

· HYDROGEN · ELECTRICITY · BIO FUELS · NATURAL GAS ·· OIL PRODUCTS
latin america: development of CO2 emissions
Whilst Latin America's emissions of CO2 will almost triple under the Reference Scenario, under the Energy [R]evolution Scenario they will decrease from 830 million tonnes in 2005 to 370 m/t in 2050. Annual per capita emissions will drop from 1.8 tonnes to 0.6 t. In spite of the phasing out of nuclear energy and increasing demand, CO2 emissions will decrease in the electricity sector. In the long run efficiency gains and the increased use of renewable electricity in vehicles will even reduce CO2 emissions in the transport sector. With a share of 53% of total CO2 in 2050, the transport sector will remain the largest source of emissions.

oecd europe: energy demand by sector
The future development pathways for Europe's energy demand are
6 shown in Figure 6.40 for both the Reference and Energy [R]evolution
Scenarios. Under the Reference Scenario, total primary energy demand in OECD Europe increases by more than 10% from the current 81,500 PJ/a to 90,300 PJ/a in 2050. In the Energy [R]evolution Scenario, demand decreases by 40% compared to current consumption, reaching 48,900 PJ/a by the end of the scenario period.
Under the Energy [R]evolution Scenario, electricity demand in all three sectors is expected to decrease after 2015 (see Figure 6.41). Because of the growing use of electric vehicles, however, electricity use for transport increases to 3,520 TWh/a in the year 2050. Compared to the Reference Scenario, efficiency measures avoid the generation of about 1,460 TWh/a. This reduction in energy demand can be achieved in particular by introducing highly efficient electronic devices using the best available technology.

Efficiency gains in the heat supply sector are even larger. Under the Energy [R]evolution Scenario, final demand for heat supply can even be reduced (see Figure 6.42). Compared to the Reference Scenario, consumption equivalent to 7,350 PJ/a is avoided through efficiency gains by 2050. As a result of energy-related renovation of the existing stock of residential buildings, as well as the introduction of low energy standards and new `passive houses', enjoyment of the same comfort and energy services will be accompanied by a much lower future energy demand.
In the transport sector, it is assumed under the Energy [R]evolution Scenario that energy demand will decrease by almost half to 8700 PJ/a by 2050, saving 58% compared to the Reference Scenario. This reduction can be achieved by the introduction of highly efficient vehicles, by shifting the transport of goods from road to rail and by changes in mobility-related behaviour patterns.

oecd europe: electricity generation
The development of the electricity supply sector is characterised by a dynamically growing renewable energy market. This will compensate for the phasing out of nuclear energy and reduce the number of fossil fuel-fired power plants required for grid stabilisation. By 2050, 86% of the electricity produced in OECD Europe will come from renewable energy sources. `New' renewables ­ mainly wind, solar thermal energy and PV ­ will contribute 67%.
The installed capacity of renewable energy technologies will grow from the current 250 GW to 1,030 GW in 2050, increasing renewables capacity by a factor of four. Figure 6.44 shows the evolution of the different renewable technologies. Up to 2020, hydro-power and wind will remain the main contributors to the growing market share. After 2020, the continuing growth of wind will be complemented by electricity from biomass, photovoltaics and solar thermal (CSP) energy.
None of these numbers describe a maximum feasibility, but a possible balanced approach. With the right policy development, the solar industry believes that a much further uptake could happen. This is particularly true for concentrated solar power (CSP) which could unfold to 30GW already by 2020 and more than 120GW in 2050. The photovoltaic industry believes in a possible electricity generation capacity of 350GW by 2020 in Europe alone, assuming the necessary policy changes.



oecd europe: future costs of electricity generation
Figure 6.45 shows that the introduction of renewable technologies
6 under the Energy [R]evolution Scenario slightly increases the costs of
electricity generation compared to the Reference Scenario. This difference will be less than 0.4 cents/kWh up to 2020, however. Because of the lower CO2 intensity of electricity generation, electricity generation costs will become economically favourable under the Energy [R]evolution Scenario by 2020, and by 2050 costs will be more than 3 cents/kWh below those in the Reference Scenario.
Under the Reference Scenario, the unchecked growth in demand, the increase in fossil fuel prices and the cost of CO2 emissions result in total electricity supply costs rising from today's $330 billion per year to more than $800 bn in 2050. Figure 6.46 shows that the Energy [R]evolution Scenario not only complies with OECD Europe CO2 reduction targets but also helps to stabilise energy costs and relieve the economic pressure on society. Increasing energy efficiency and shifting energy supply to renewables leads to long term costs for electricity supply that are one third lower than in the Reference Scenario.
figure 6.45: oecd europe: development of specific electricity generation costs under the two scenarios
(CO2 EMISSION COSTS IMPOSED FROM 2010, WITH AN INCREASE FROM 15 $/TCO2 IN 2010 TO 50 $/TCO2 IN 2050)

oecd europe: heat and cooling supply Renewables currently provide 11% of OECD Europe's primary energy demand for heat supply, the main contribution coming from the use of biomass. The lack of district heating networks is a severe structural barrier to the large scale utilisation of geothermal and solar thermal energy. In the Energy [R]evolution Scenario, renewables provide 61% of OECD Europe's total heating and cooling demand in 2050. · Energy efficiency measures can decrease the current demand for
heat supply by 18%, in spite of improving living standards. · For direct heating, solar collectors, biomass/biogas as well as
geothermal energy are increasingly substituting for fossil fuelfired systems.
figure 6.47: oecd europe: development of heat supply structure under the two scenarios
(`EFFICIENCY' = REDUCTION COMPARED TO THE REFERENCE SCENARIO)

africa: energy demand by sector
Future development pathways for Africa's energy demand are shown in
6 Figure 6.51 for both the Reference and Energy [R]evolution Scenarios.
Under the Reference Scenario, total primary energy demand more than doubles from the current 25,200 PJ/a to 53,300 PJ/a in 2050. In the Energy [R]evolution Scenario, a much smaller 50% increase on current consumption is expected by 2050 to reach 38,300 PJ/a.
Under the Energy [R]evolution Scenario, electricity demand in Africa is expected to increase disproportionately, with households and services the main source of growing consumption (see Figure 6.52). With the exploitation of efficiency measures, however, an even higher increase can be avoided, leading to electricity demand of around 1,340 TWh/a in the year 2050. Compared to the Reference Scenario, efficiency measures avoid the generation of about 620 TWh/a.

Efficiency gains in the heat supply sector are also significant. Under the Energy [R]evolution Scenario, final demand for heat supply can even be reduced (see Figure 6.53). Compared to the Reference Scenario, consumption equivalent to 550 PJ/a is avoided through efficiency gains by 2050.
In the transport sector, it is assumed under the Energy [R]evolution Scenario that energy demand will almost double to 5,300 PJ/a by 2050, still saving 46% compared to the Reference Scenario. This reduction can be achieved by the introduction of highly efficient vehicles, by shifting the transport of goods from road to rail and by changes in mobility-related behaviour.


africa: electricity generation
The development of the electricity supply sector is characterised by a dynamically growing renewable energy market and an increasing share of renewable electricity. By 2050, 73% of the electricity produced in Africa will come from renewable energy sources. A main driver for the development of solar power generation capacities will be the export of solar electricity to OECD Europe. `New' renewables ­ mainly wind, solar thermal energy and PV ­ will contribute more than 60% of electricity generation.
The installed capacity of renewable energy technologies will grow from the current 21 GW to 388 GW in 2050, increasing renewable capacity by a factor of 18 over the next 42 years. More than 60 GW CSP plants will produce electricity for export to Europe.
Figure 6.55 shows the comparative evolution of different renewable technologies over time. Up to 2020, hydro-power and wind will remain the main contributors to the growing market share. After 2020, the continuing growth of wind will be complemented by electricity from biomass, photovoltaics and solar thermal (CSP) energy.

africa: future costs of electricity generation
Figure 6.56 shows that the introduction of renewable technologies
6 under the Energy [R]evolution Scenario significantly decreases the
future costs of electricity generation. Because of the lower CO2 intensity, electricity generation costs will steadily become more economic under the Energy [R]evolution Scenario and by 2050 will be more than 9 cents/kWh below those in the Reference Scenario.
Under the Reference Scenario, by contrast, unchecked demand growth, the increase in fossil fuel prices and the cost of CO2 emissions result in total electricity supply costs rising from today's $59 billion per year to more than $468 bn in 2050. Figure 6.57 shows that the Energy [R]evolution Scenario not only complies with Africa's CO2 reduction targets but also helps to stabilise energy costs. Increasing energy efficiency and shifting energy supply to renewables leads to long term costs for electricity supply that are one third lower than in the Reference Scenario.

africa: heat and cooling supply
Today, renewables provide around 75% of primary energy demand for heat supply in Africa, the main contribution coming from the use of biomass. The availability of less efficient but cheap appliances is a severe structural barrier to efficiency gains. Large-scale utilisation of geothermal and solar thermal energy for heat supply is restricted to the industrial sector. Dedicated support instruments are required to ensure a continuously dynamic development of renewables in the heat market.
In the Energy [R]evolution Scenario, renewables provide 72% of Africa's total heating and cooling demand in 2050.
· Energy efficiency measures can restrict the future energy demand for heat and cooling supply to a 50% increase, in spite of improving living standards.
· In the industry sector solar collectors, biomass/biogas as well as geothermal energy are increasingly substituting for conventional fossil-fired heating systems.
· A shift from coal and oil to natural gas in the remaining conventional applications leads to a further reduction of CO2 emissions.
figure 6.58: africa: development of heat supply structure under the two scenarios
(`EFFICIENCY' = REDUCTION COMPARED TO THE REFERENCE SCENARIO)

key results | AFRICA - TRANSPORT - CONSUMPTION - CO2 EMISSIONS

africa: transport
In the transport sector, it is assumed under the Energy [R]evolution Scenario that energy demand will almost double to 5,300 PJ/a by 2050, still saving 46% compared to the Reference Scenario.This reduction can be achieved by the introduction of highly efficient vehicles, by shifting the transport of goods from road to rail and by changes in mobility-related behaviour.The African car fleet is projected to grow by a factor of 6 to roughly 100 million vehicles. Development of fuel efficiency is delayed by 20 years compared to other world regions for economic reasons. By 2050, Africa will still have the lowest average fuel consumption.

africa: primary energy consumption
Taking into account the assumptions discussed above, the resulting
primary energy consumption under the Energy [R]evolution Scenario 6
is shown in Figure 6.60. Compared to the Reference Scenario, overall energy demand will be reduced by about 30% in 2050. Under the Energy [R]evolution Scenario, Africa's energy demand will increase from 25,200 PJ/a to 38,300 PJ/a in 2050. Around 56% of this demand will be covered by renewable energy sources.

africa: development of CO2 emissions
While Africa's emissions of CO2 will almost triple under the Reference Scenario, under the Energy [R]evolution Scenario they will increase from 780 million tonnes in 2003 to 895 m/t in 2050. Annual per capita emissions will drop from 0.8 tonnes to 0.45 t. In spite of increasing demand, CO2 emissions will decrease in the electricity sector. In the long run efficiency gains and the increased use of bio fuels and electricity will reduce CO2 emissions in the transport sector. With a share of 28% of total CO2 in 2050, the power sector will drop below transport as the largest source of emissions.

middle east: energy demand by sector
The future development pathways for the Middle East's energy
6 demand are shown in Figure 6.62 for both the Reference and
Energy [R]evolution Scenarios. Under the Reference Scenario, total primary energy demand more than doubles from the current 21,400 PJ/a to 54,980 PJ/a in 2050. In the Energy [R]evolution Scenario, a much smaller 28% increase on current consumption is expected by 2050, reaching 27,600 PJ/a.
Under the Energy [R]evolution Scenario, electricity demand is expected to increase disproportionately, with households and services the main source of growing consumption (see Figure 6.63), leading to an electricity demand of around 1,620 TWh/a in the year 2050. Compared to the Reference Scenario, efficiency measures avoid the generation of about 390 TWh/a.

Efficiency gains in the heat supply sector are even larger. Under the Energy [R]evolution Scenario (see Figure 6.64), consumption equivalent to 2,650 PJ/a is avoided through efficiency gains by 2050.
In the transport sector, it is assumed under the Energy [R]evolution Scenario that energy demand will be slightly reduced compared to today's level, reaching 3,990 PJ/a by 2050, a saving of 49% compared to the Reference Scenario. This reduction can be achieved by the introduction of highly efficient vehicles, by shifting the transport of goods from road to rail and by changes in mobilityrelated behaviour patterns.

middle east: electricity generation
The development of the electricity supply sector is characterised by an increasing share of renewable electricity. By 2050, 95% of the electricity produced in the Middle East will come from renewable energy sources. `New' renewables ­ mainly wind, solar thermal energy and PV ­ will contribute about 90% of electricity generation.
The installed capacity of renewable energy technologies will grow from the current 10 GW to 556 GW in 2050, a very large increase over the next 42 years requiring political support and well-designed policy instruments. Figure 6.66 shows the comparative evolution of the different technologies over the period up to 2050.


middle east: future costs of electricity generation
Figure 6.67 shows that the introduction of renewable technologies
6 under the Energy [R]evolution Scenario will lead to a significant
reduction of electricity generation costs. Under the Reference Scenario, on the other hand, the unchecked growth in demand, increase in fossil fuel prices and the cost of CO2 emissions result in total electricity supply costs rising from today's $133 billion per year to more than $870 bn in 2050. Figure 6.68 shows that the Energy [R]evolution Scenario not only meets the Middle East's CO2 reduction targets but also helps to stabilise energy costs. Long term costs for electricity supply are one third lower than in the Reference Scenario.

middle east: heat and cooling supply
Renewables currently provide only 1% of primary energy demand for heat and cooling in the Middle East, the main contribution coming from the use of biomass and solar collectors. Dedicated support instruments are required to ensure a continuously dynamic development of renewables in the heat market.
In the Energy [R]evolution Scenario, renewables satisfy 83% of the Middle East's total heating and cooling demand in 2050.
· Energy efficiency measures can restrict the future primary energy demand for heat and cooling supply to a doubling rather than tripling, in spite of improving living standards.
· In the industry sector solar collectors, biomass/biogas as well as geothermal energy are increasingly substituting for conventional fossil-fired heating systems.

middle east: transport
Traditionally, in a region with major oil resources, transport has been powered 100% by fossil fuels. Rising prices, together with other incentives, lead to a projected share of 27% of renewable electricity in this sector. Highly efficient electrified cars ­ plug-in-hybrid and battery vehicles ­ contribute to a total energy saving of 16%, although the car fleet is still projected to grow by a factor of 5 by 2050. The further promotion of energy efficient transport modes will help to reduce annual vehicle kilometres travelled by 0.25% p.a.

middle east: primary energy consumption

Taking into account these assumptions, the resulting primary energy

consumption under the Energy [R]evolution Scenario is shown in


middle east: development of CO2 emissions
While CO2 emissions in the Middle East will triple under the Reference Scenario by 2050, and are thus far removed from a sustainable development path, under the Energy [R]evolution Scenario they will decrease from 1,170 million tonnes in 2005 to 390 m/t in 2050. Annual per capita emissions will drop from 6.2 tonnes/capita to 1.1 t. In spite of an increasing electricity demand, CO2 emissions will decrease strongly in the electricity sector. In the long run efficiency gains and the increased use of renewable electricity in vehicles will even reduce CO2 emissions in the transport sector.

transition economies: energy demand by sector
Future development pathways for energy demand in the Transition
6 Economies are shown in Figure 6.73 for both the Reference and
Energy [R]evolution Scenarios. Under the Reference Scenario, total primary energy demand increases by 38 % from the current 46,250 PJ/a to 63,930 PJ/a in 2050. In the Energy [R]evolution Scenario, demand decreases by 23% compared to current consumption and is expected to reach 35,760 PJ/a by 2050.
Under the Energy [R]evolution Scenario, electricity demand is expected to increase disproportionately, with transport and the households and services sectors being the main source of growing consumption (see Figure 6.74). With the exploitation of efficiency measures, however, an even higher increase can be avoided, leading

to electricity demand of around 1,550 TWh/a in 2050. Compared to the Reference Scenario, efficiency measures avoid the generation of about 560 TWh/a.
Efficiency gains in the heat supply sector are even larger. Under the Energy [R]evolution Scenario, final demand for heat supply can even be reduced after 2030 (see Figure 6.75). Compared to the Reference Scenario, consumption equivalent to 5,990 PJ/a is avoided through efficiency gains.
In the transport sector, it is assumed under the Energy [R]evolution Scenario that energy demand will decrease by 28% to 4,240 PJ/a by 2050, saving 57% compared to the Reference Scenario.

transition economies: electricity generation
The development of the electricity supply sector is characterised by a growing renewable energy market. This will compensate for the phasing out of nuclear energy and reduce the number of fossil fuelfired power plants required for grid stabilisation. By 2050, 81% of the electricity produced in the Transition Economy countries will come from renewable energy sources. `New' renewables ­ mainly wind, solar thermal energy and PV ­ will contribute 65% of electricity generation.
The installed capacity of renewable energy technologies will grow from the current 93 GW to 550 GW in 2050, increasing capacity by a factor of six over the next 42 years. This will require political support and well-designed policy instruments.
Figure 6.77 shows the expansion rate of the different renewable technologies over time. Up to 2020, hydro-power and wind will remain the main contributors. After 2020, the continuing growth of wind will be complemented by electricity from biomass, photovoltaics and geothermal energy.


transition economies: future costs of electricity generation
6 Figure 6.78 shows that the introduction of renewable technologies under
the Energy [R]evolution Scenario slightly increases the costs of electricity generation compared to the Reference Scenario. This difference will be about 0.5 cents/kWh in 2015. Because of the lower CO2 intensity of electricity generation, by 2020 these costs will become economically favourable under the Energy [R]evolution Scenario and by 2050 will be more than 5 cents/kWh below those in the Reference Scenario.
Due to growing demand, there will be a significant increase in society's expenditure on electricity supply. Under the Reference Scenario, total electricity supply costs will rise from today's $190 billion per year to $520 bn in 2050. Figure 6.79 shows that the Energy [R]evolution Scenario not only complies with the Transition Economies' CO2 reduction targets but also helps to stabilise energy costs and relieve the economic pressure on society. Long term costs for electricity supply are one third lower than in the Reference Scenario.
transition economies: heat and cooling supply
Renewables currently provide just 3% of the Transition Economies' primary energy demand for heat supply, the main contribution coming from the use of biomass. The lack of available infrastructure for modern and efficient district heating networks is a barrier to the large scale utilisation of biomass, geothermal and solar thermal energy. Dedicated support instruments are required to ensure a dynamic development.
In the Energy [R]evolution Scenario, renewables provide 75% of the Transition Economies' total heating demand in 2050.
· Energy efficiency measures can moderate the increase in heat demand, and in spite of improving living standards after 2030 lead to a decrease in demand, which in 2050 is slightly lower than at present.
· For direct heating, solar collectors, biomass/biogas as well as geothermal energy are increasingly substituting for fossil fuelfired systems.
· A shift from coal and oil to natural gas in the remaining conventional applications will lead to a further reduction of CO2 emissions.
figure 6.80: transition economies: development of heat supply structure under the two scenarios
(`EFFICIENCY' = REDUCTION COMPARED TO THE REFERENCE SCENARIO)
transition economies: transport
Development of the transport sector is characterised by the diversification of energy sources towards bio fuels (9%) and electricity (28%) up to 2050. The time taken to reach reference target levels for efficient vehicles is delayed by ten years compared to the most other industrialised countries. Although the light duty vehicle stock will triple by 2050, increasingly attractive and highly efficient suburban and long distance rail services, as well as growing fuel prices, will lead to the vehicle kilometres travelled falling by 10% between 2010 and 2050. These measures and incentives, together with highly efficient cars, will result in nearly 30% energy savings in the transport sector.
figure 6.81: transition economies: transport under the two scenarios
(`EFFICIENCY' = REDUCTION COMPARED TO THE REFERENCE SCENARIO)
transition economies: development of CO2 emissions
Whilst emissions of CO2 will increase by 11% under the Reference Scenario, under the Energy [R]evolution Scenario they will decrease from 2,380 million tonnes in 2005 to 540 m/t in 2050. Annual per capita emissions will drop from 7.0 tonnes to 1.8 t. In spite of the phasing out of nuclear energy and increasing demand, CO2 emissions will decrease in the electricity sector.

transition economies: primary energy consumption
Taking into account the changes outlined above, the resulting primary
energy consumption under the Energy [R]evolution Scenario is shown 6
in Figure 6.82. Compared to the Reference Scenario, overall energy demand will be reduced by 44% in 2050. Around 60% of the remaining demand will be covered by renewable energy sources.


india: energy demand by sector
The potential future development pathways for India's primary
6 energy demand are shown in Figure 6.84 for both the Reference and
Energy [R]evolution Scenarios. Under the Reference Scenario, total primary energy demand quadruples from the current 22,300 PJ/a to 89,100 PJ/a in 2050. In the Energy [R]evolution Scenario, by contrast, demand will increase by about 230 % and is expected to reach 52,000 PJ/a by 2050.
Under the Energy [R]evolution Scenario, electricity demand is expected to increase substantially (see Figure 6.85). With the exploitation of efficiency measures, however, a higher increase can be avoided, leading to demand of around 3,500 TWh/a in 2050. Compared to the Reference Scenario, efficiency measures avoid the generation of about 1,410 TWh/a. This reduction can be achieved in

particular by introducing highly efficient electronic devices using the best available technology in all demand sectors.
Efficiency gains for heat and cooling supply are also significant. Under the Energy [R]evolution Scenario, final demand for heating and cooling can even be reduced (see Figure 6.86). Compared to the Reference Scenario, consumption equivalent to 3,130 PJ/a is avoided through efficiency gains by 2050.
In the transport sector it is assumed that a fast growing economy will see energy demand, even under the Energy [R]evolution Scenario, increase dramatically - from 1,550 PJ/a in 2005 to 8,700 PJ/a by 2050. This still saves 50% compared to the Reference Scenario. This reduction can be achieved by the introduction of highly efficient vehicles, shifting freight transport from road to rail and by changes in travel behaviour.

india: electricity generation
By 2050, about 60% of the electricity produced in India will come from renewable energy sources. `New' renewables ­ mainly wind, solar thermal energy and PV ­ will contribute almost 50%. The installed capacity of renewable energy technologies will grow from the current 38 GW to 915 GW in 2050, a substantial increase over the next 42 years.
Figure 6.88 shows the comparative evolution of different renewable technologies over time. Up to 2030, hydro-power and wind will remain the main contributors. After 2020, the continuing growth of wind will be complemented by electricity from biomass, photovoltaics and solar thermal (CSP) energy.


india: future costs of electricity generation
Figure 6.89 shows that the introduction of renewable technologies
6 under the Energy [R]evolution Scenario significantly decreases the
future costs of electricity generation compared to the Reference Scenario. Because of the lower CO2 intensity, electricity generation costs will become economically favourable under the Energy [R]evolution Scenario and by 2050 will be more than 4.5 cents/kWh below those in the Reference Scenario.
Under the Reference Scenario, a massive growth in demand, increased fossil fuel prices and the cost of CO2 emissions result in total electricity supply costs rising from today's $64 billion per year to more than $930 bn in 2050. Figure 6.90 shows that the Energy [R]evolution Scenario not only complies with India's CO2 reduction targets but also helps to stabilise energy costs. Increasing energy efficiency and shifting energy supply to renewables leads to long term costs that are one third lower than in the Reference Scenario.

india: heat and cooling supply
Renewables presently provide 63% of primary energy demand for heat and cooling supply in India, the main contribution coming from the use of biomass. Dedicated support instruments are required to ensure a continuously dynamic development of renewables in the heat market.
In the Energy [R]evolution Scenario, renewables will provide 71% of India's heating and cooling demand by 2050.
· Energy efficiency measures will restrict future primary energy demand for heat and cooling supply to an increase of 90% by 2005, in spite of improving living standards. This compares to 130% in the Reference Scenario.
· In the industry sector solar collectors, biomass/biogas and geothermal energy are increasingly replacing conventional fossilfired heating systems.
· A shift from coal and oil to natural gas in the remaining conventional applications leads to a further reduction of CO2 emissions.

india: transport
India's car fleet is projected to grow by a factor of 16 from 2000 to 2050. Presently characterised by small cars (70%), this will stay the same up to 2050. Although India will remain a low price car market, the key to efficiency lies in electrified powertrains (hybrid, plug-in and battery electric). Biofuels will take over 6% and electricity 22% of total transport energy demand. Stringent energy efficiency measures will help limit growth of transport energy demand by 2050 to about a factor of 5.5 compared to 2005.

india: primary energy consumption

Taking into account the above assumptions, the resulting primary

energy consumption under the Energy [R]evolution Scenario is

6

shown in Figure 6.93. Compared to the Reference Scenario, overall

demand will be reduced by about 40% in 2050. Around half of this

will be covered by renewable energy sources.


india: development of CO2 emissions
While CO2 emissions in India will increase under the Reference Scenario by a factor of 5.4 up to 2050, and are thus far removed from a sustainable development path, under the Energy [R]evolution Scenario they will increase from the current 1,074 million tonnes in 2005 to reach a peak of 1,820 m/t in 2030. After that they will decrease to 1,660 m/t in 2050. Annual per capita emissions will increase to 1.3 tonnes/capita in 2030 and fall again to 1.0 t/capita in 2050. In spite of the phasing out of nuclear energy and increasing electricity demand, CO2 emissions will decrease in the electricity sector.
After 2030, efficiency gains and the increased use of renewables in all sectors will soften the still increasing CO2 emissions in transport, the power sector and industry. Although its share is decreasing, the power sector will remain the largest source of emissions in India, contributing 50% of the total in 2050, followed by transport.
developing asia: energy demand by sector
The future development pathways for Developing Asia's primary
6 energy demand are shown in Figure 6.95 for both the Reference
and Energy [R]evolution Scenarios. Under the Reference Scenario, total primary energy demand more than doubles from the current 31,100 PJ/a to 67,400 PJ/a in 2050. In the Energy [R]evolution Scenario, a much smaller 40% increase in consumption is expected by 2050, reaching 43,800 PJ/a.
Under the Energy [R]evolution Scenario, electricity demand is expected to increase disproportionately in Developing Asia (see Figure 6.96). With the introduction of serious efficiency measures, however, an even higher increase can be avoided, leading to electricity demand of around 1,965 TWh/a in 2050. Compared to the Reference Scenario, efficiency measures avoid the generation of about 860 TWh/a.

Efficiency gains in the heat supply sector are also significant (see Figure 6.97). Compared to the Reference Scenario, consumption equivalent to 2,900 PJ/a is avoided through efficiency measures by 2050. In the transport sector, it is assumed under the Energy [R]evolution Scenario that energy demand will rise to 8,300 PJ/a by 2050, saving 90% compared to the Reference Scenario.

 electricity generation
The development of the electricity supply sector is characterised by an increasing share of renewable electricity. This will compensate for the phasing out of nuclear energy and reduce the number of fossil fuel-fired power plants required. By 2050, 67% of the electricity produced in Developing Asia will come from renewable energy sources. `New' renewables ­ mainly wind, solar thermal energy and PV ­ will contribute 55%.
The installed capacity of renewable energy technologies will grow from the current 51 GW to 590 GW in 2050, increasing capacity by a factor of more than ten.
Figure 6.99 shows the comparative evolution of the different technologies over time. Up to 2020, hydro-power and wind will remain the main contributors. After 2020, the continuing growth of wind will be complemented by electricity from biomass, photovoltaics and geothermal sources.


developing asia: future costs of electricity generation
6 Figure 6.100 shows that the introduction of renewable technologies
under the Energy [R]evolution Scenario significantly decreases the future costs of electricity generation compared to the Reference Scenario. Because of lower CO2 intensity in electricity generation, costs will become economically favourable under the Energy [R]evolution Scenario. By 2050 they will be more than 5 cents/kWh below those in the Reference Scenario.
Under the Reference Scenario, unchecked growth in demand, an increase in fossil fuel prices and the cost of CO2 emissions result in total electricity supply costs rising from today's $98 billion per year to more than $566 bn in 2050. Figure 6.101 shows that the Energy [R]evolution Scenario not only complies with Developing Asia's CO2 reduction targets but also helps to stabilise energy costs. Increasing energy efficiency and shifting supply to renewables leads to long term costs that are almost one third lower than in the Reference Scenario.
developing asia: heat and cooling supply
The starting point for renewables in the heat supply sector is quite different from the power sector. Today, renewables provide 53% of primary energy demand for heat and cooling supply in Developing Asia, the main contribution coming from biomass. Dedicated support instruments are still required to ensure a continuously dynamic development of renewables in the heat market.
In the Energy [R]evolution Scenario, renewables provide 70% of Developing Asia's heating and cooling demand in 2050.
· Energy efficiency measures can restrict the future primary energy demand for heat and cooling supply to a increase of 48%, compared to 77% in the Reference Scenario, in spite of improving living standards.
· In the industry sector solar collectors, biomass/biogas and geothermal energy are increasingly replacing conventional fossil fuel-fired heating systems.
· A shift from coal and oil to natural gas in the remaining conventional applications leads to a further reduction of CO2 emissions.
figure 6.102: developing asia: development of heat supply structure under the two scenarios
(`EFFICIENCY' = REDUCTION COMPARED TO THE REFERENCE SCENARIO)

developing asia: transport
This region's light duty vehicle stock is projected to grow by a factor of 10 from 2000 to 2050. Biofuels will reach a share of 7%, electricity 9% of the energy needed in the total transport sector. Highly efficient hybrid car technologies, together with plug-in and battery electric vehicles, will lead to significant gains in energy efficiency.

developing asia: primary energy consumption
Taking into account the assumptions discussed above, the resulting
primary energy consumption under the Energy [R]evolution Scenario 6
is shown in Figure 6.104. Compared to the Reference Scenario, overall demand will be reduced by almost 35% in 2050. Around half of the remaining demand will be covered by renewables.

developing asia: development of CO2 emissions
Whilst Developing Asia's CO2 emissions will increase by a factor of 2.5 under the Reference Scenario, in the Energy [R]evolution Scenario they will decrease from 1,300 million tonnes in 2005 to 1,150 m/t in 2050. Annual per capita emissions will drop from 1.3 tonnes to 0.8 t. In spite of the phasing out of nuclear energy and increasing demand, CO2 emissions will decrease in the electricity sector. In the long run efficiency gains and the increased use of renewable electricity in vehicles will stabilise CO2 emissions in the transport sector. With a share of 22% of total CO2 in 2050, the power sector will drop below transport as the largest source of emissions.

china: energy demand by sector
The future development pathways for China's primary energy
6 demand are shown in Figure 6.106 for both the Reference and
Energy [R]evolution Scenarios. Under the Reference Scenario, total primary energy demand will increase by a factor of 2.5 from the current 73,000 PJ/a to 185,020 PJ/a in 2050. In the Energy [R]evolution Scenario, primary energy demand increases up to 2030 by 60% and decreases to a level of 99,150 PJ/a in 2050.
Under the Energy [R]evolution Scenario, electricity demand is expected to increase disproportionately (see Figure 6.107). With the exploitation of efficiency measures, however, an even higher increase can be avoided, leading to demand of around 7,500 TWh/a in 2050. Compared to the Reference Scenario, efficiency measures avoid the generation of about 3,160 TWh/a.

Efficiency gains in the heat supply sector are large as well. Under the Energy [R]evolution Scenario, final demand for heat supply can even be reduced (see Figure 6.108). Compared to the Reference Scenario, consumption equivalent to 10,300 PJ/a is avoided through efficiency gains by 2050.
In the transport sector, it is assumed under the Energy [R]evolution Scenario that energy demand will increase considerably, from 5,100 PJ/a in 2005 to 17,300 PJ/a by 2050. However this still saves 50% compared to the Reference Scenario.

china: electricity generation
A dynamically growing renewable energy market will compensate for the phasing out of nuclear energy and reduce the number of fossil fuel-fired power plants required for grid stabilisation. By 2050, 63% of the electricity produced in China will come from renewable energy sources. `New' renewables ­ mainly wind, solar thermal energy and PV ­ will contribute 46% of electricity generation. The following strategy paves the way for a future renewable energy supply:
Rising electricity demand will be met initially by bringing into operation new highly efficient gas-fired combined-cycle power plants, plus an increasing capacity of wind turbines and biomass. In the long term, wind will be the most important single source of electricity generation. Solar energy, hydro-power and biomass will also make substantial contributions.
The installed capacity of renewable energy technologies will grow from the current 119 GW to 1,950 GW in 2050, an enormous increase resulting in a considerable demand for investment over the next 20 years. Figure 6.110 shows the comparative evolution of the different renewable technologies over time. Up to 2020, hydropower and wind will remain the main contributors. After 2020, the continuing growth of wind will be complemented by electricity from biomass, photovoltaics and solar thermal energy.

china: future costs of electricity generation
Figure 6.111 shows that the introduction of renewable technologies
6 under the Energy [R]evolution Scenario slightly increases the costs
of electricity generation compared to the Reference Scenario. The difference will be less than 1 cents/kWh up to 2020. Because of the lower CO2 intensity, by 2020 electricity generation costs in China will become economically favourable under the Energy [R]evolution Scenario, and by 2050 will be more than 5 cents/kWh below those in the Reference Scenario.
Under the Reference Scenario, the unchecked growth in demand, the increase in fossil fuel prices and the cost of CO2 emissions result in total electricity supply costs rising from today's $ 205 billion per year to more than $ 1,940 bn in 2050. Figure 6.112 shows that the Energy [R]evolution Scenario not only complies with China's CO2 reduction targets but also helps to stabilise energy costs. Increasing energy efficiency and shifting energy supply to renewables leads to long term costs for electricity supply that are one third lower than in the Reference Scenario.

china: heat and cooling supply
Today, renewables provide 28% of primary energy demand for heat and cooling supply in China, the main contribution coming from the use of biomass.
In the Energy [R]evolution Scenario, renewables provide 65% of China's total heating and cooling demand by 2050.
· Energy efficiency measures will restrict the future primary energy demand for heat and cooling supply to an increase of 21%, compared to 61% in the Reference Scenario, in spite of improving living standards.
· In the industry sector solar collectors, biomass/biogas as well as geothermal energy are increasingly substituting for conventional fossil-fired heating systems.
· A shift from coal and oil to natural gas in the remaining conventional applications leads to a further reduction of CO2 emissions.

In 2050, the light duty vehicle stock in China will be 20 times larger

Taking into account the above assumptions, the resulting primary

than today.Today, more medium to large sized cars are driven in China, energy consumption under the Energy [R]evolution Scenario is

6

with an unusually high annual mileage. With growing individual mobility, shown in Figure 6.115. Compared to the Reference Scenario,

an increasing share of small efficient cars is projected, with vehicle

overall energy demand will be reduced by almost 47 in 2050.

kilometres driven converging with industrialised country averages. More Around 47% of the remaining demand will be covered by

efficient propulsion technologies, including hybrid-electric powertrains

renewable energy sources.

and lightweight construction, will help limit the increase in total

transport energy demand to a factor of 3.4, reaching 17,300 PJ/a in

2050. As China already has a large fleet of electric vehicles, this will

grow to the point where almost 25% of total transport energy is

covered by electricity. Bio fuels will contribute about 7%.
· HYDROGEN · ELECTRICITY · BIO FUELS · NATURAL GAS ·· OIL PRODUCTS
china: development of CO2 emissions
Whilst China's emissions of CO2 will almost triple under the Reference Scenario, under the Energy [R]evolution Scenario they will decrease from 4,400 million tonnes in 2005 to 3,200 m/t in 2050. Annual per capita emissions will drop from 3.4 tonnes to 2.3 t. In spite of increasing demand, CO2 emissions will decrease in the electricity sector. In the long run efficiency gains and the increased use of renewable electricity in vehicles will even reduce CO2 emissions in the transport sector. With a share of 50% of total CO2 in 2050, the power sector will remain the largest source of emissions.
oecd pacific: energy demand by sector
The future development pathways for the OECD Pacific's primary
6 energy demand are shown in Figure 6.117 for both the Reference and
Energy [R]evolution Scenarios. Under the Reference Scenario, total primary energy demand increases by 27% - from the current 37,040 PJ/a to 47,020 PJ/a in 2050. In the Energy [R]evolution Scenario, by contrast, primary energy demand decreases by 33% compared to current consumption and is expected by 2050 to reach 24,950 PJ/a.
Under the Energy [R]evolution Scenario, electricity demand in the industry as well as the residential and services sectors is expected to fall slightly below the current level of demand (see Figure 6.118). The growing use of electric vehicles however leads to an increase in electricity demand, reaching 1,920 TWh/a in 2050. Overall demand is still 560 TWh/a lower than in the Reference Scenario.

Efficiency gains in the heat supply sector are even larger. Under the Energy [R]evolution Scenario, final demand for heat supply can even be reduced (see Figure 6.119). Compared to the Reference Scenario, consumption equivalent to 2,860 PJ/a is avoided through efficiency gains by 2050.
In the transport sector, it is assumed under the Energy [R]evolution Scenario that energy demand will decrease by 40% to 4,000 PJ/a by 2050, saving about 50% compared to the Reference Scenario.

oecd pacific: electricity generation
A dynamically growing renewable energy market will compensate for the phasing out of nuclear energy and reduce the number of fossil fuel-fired power plants required for grid stabilisation. By 2050, 78% of the electricity produced in the OECD Pacific will come from renewable energy sources. `New' renewables ­ mainly wind, solar thermal energy and PV ­ will contribute 68%.
The installed capacity of renewable energy technologies will grow from the current 62 GW to more than 600 GW in 2050, an increase by a factor of ten.
To achieve an economically attractive growth in renewable energy sources, a balanced and timely mobilisation of all technologies is of great importance. Figure 6.121 shows the comparative evolution of the different renewables over time. Up to 2020, hydro-power and wind will remain the main contributors. After 2020, the continuing growth of wind will be complemented by electricity from biomass, photovoltaic and solar thermal energy.

Figure 6.122 shows that the introduction of renewable technologies
6 under the Energy [R]evolution Scenario slightly increases the costs
of electricity generation in the OECD Pacific compared to the Reference Scenario. The difference will be less than 1.5 cents/kWh up to 2030. Because of the lower CO2 intensity, by 2020 electricity generation costs will become economically favourable under the Energy [R]evolution Scenario, and by 2050 they will be more than 4 cents/kWh below those in the Reference Scenario.
Under the Reference Scenario, by contrast, unchecked growth in demand, an increase in fossil fuel prices and the cost of CO2 emissions result in total electricity supply costs rising from today's $160 billion per year to more than $400 bn in 2050. Figure 6.123 shows that the Energy [R]evolution Scenario not only complies with the OECD Pacific's CO2 reduction targets but also helps to stabilise energy costs. Increasing energy efficiency and shifting energy supply to renewables leads to long term costs for electricity supply that are one third lower than in the Reference Scenario.

oecd pacific: heat and cooling supply
Renewables currently provide 5% of OECD Pacific's primary energy demand for heat supply, the main contribution coming from biomass. Dedicated support instruments are required to ensure a future dynamic development.
In the Energy [R]evolution Scenario, renewables provide 73% of OECD Pacific's total heating and cooling demand by 2050.
· Energy efficiency measures can decrease the current demand for heat supply by 10%, in spite of improving living standards.
· For direct heating, solar collectors, biomass/biogas as well as geothermal energy are increasingly substituting for fossil fuelfired systems.
· A shift from coal and oil to natural gas in the remaining conventional applications will lead to a further reduction of CO2 emissions.

oecd pacific: transport
The low duty vehicles (LDV) market in OECD Pacific is driven by Japan, with a unique share of small cars and a fuel consumption average of 6.45 litres/100 km in the new car fleet. Other countries in the region typically drive larger cars, and incentives to encourage smaller cars will be crucial. The LDV stock is projected to grow by a factor of 1.4 to 119 million vehicles. While 94% of all LDVs use petrol today, electrified vehicles will play a key role, especially in Japan's well suited small cars, in reducing energy demand. By 2050, 35% of total transport energy is covered by electricity and 25% by bio fuels.
figure 6.125: oecd pacific: transport under the two scenarios
(`EFFICIENCY' = REDUCTION COMPARED TO THE REFERENCE SCENARIO)

oecd pacific: primary energy consumption

Taking into account the above assumptions, the resulting primary

energy consumption under the Energy [R]evolution Scenario is

6

shown in Figure 6.126. Compared to the Reference Scenario, overall

energy demand will be reduced by 47% in 2050. Around 55% of

the remaining demand will be covered by renewable energy sources.
Whilst the OECD Pacific's emissions of CO2 will increase by 20% under the Reference Scenario, under the Energy [R]evolution Scenario they will decrease from 1,900 million tonnes in 2005 to 430 m/t in 2050. Annual per capita emissions will fall from 9.5 tonnes to 2.4 t. In the long run efficiency gains and the increased use of renewable electricity in vehicles will even reduce CO2 emissions in the transport sector. With a share of 45% of total CO2 in 2050, the power sector will remain the largest source of emissions.

global market overview
The global market for renewable energy has been expanding in recent years at a record rate, an indication of its potential to realise the future targets outlined in the Energy [R]evolution Scenario.
· Renewable electricity generation capacity reached an estimated 240 Gigawatts (GW) worldwide in 2007, an increase of 50 % over 2004. Renewables represent 5 % of global power capacity and 3.4 % of global power generation. These figures exclude large hydropower, which alone accounted for 15 % of global power generation.
· Renewable energy (excluding large hydropower) generated as much electric power worldwide in 2006 as one-quarter of the world's nuclear power plants.
· The largest component of renewable generation capacity is wind power, which grew by 28 % worldwide in 2007 to reach 95 GW. The annual capacity growth rate is even higher: 40 % more in 2007 than the year before.
· The fastest growing energy technology in the world is grid-connected solar photovoltaics (PV), with a 50 % annual increase in cumulative installed capacity in both 2006 and 2007 to reach 7.7 GW. This translates into 1.5 million homes with rooftop solar PV feeding into the grid.
· Rooftop solar heat collectors provide hot water to nearly 50 million households worldwide, and space heating to a growing number of homes. Existing solar hot water/heating capacity increased by 19 % in 2006 to reach 105 Gigawatts thermal (GWth) globally.
· The use of biomass and geothermal energy for both power and heating has been increasing in a number of countries, including for district heating networks. More than 2 million ground source heat pumps are now used in 30 countries to heat (and cool) buildings.
· Renewable energy, in particular small hydropower, biomass and solar PV, is providing electricity, heat, motive power and water pumping for tens of millions of people in the rural areas of developing countries, serving agriculture, small industry, homes and schools. 25 million households cook and light their homes with biogas and 2.5 million households use solar lighting systems.
· Developing countries account for more than 40 % of existing renewable power capacity, more than 70 % of solar hot water capacity and 45 % of bio fuels production.
In terms of investment, an estimated $71 billion was invested in new renewable power and heating capacity worldwide in 2007 (excluding large hydropower). Of this, 47 % was for wind power and 30 % for solar PV. Investment in large hydropower, the most established renewable energy source, added a further $15­20 billion. The total amount invested in new renewable energy capacity, manufacturing plants and research and development during 2007 is estimated to have reached a record $100 billion.

Investment flows have also became more diversified and mainstream, with funding flowing from a wide range of sources, including major commercial and investment banks, venture capital and private equity investors, multilateral and bilateral development organisations as well as smaller local financiers. The renewable energy industry has seen many new companies launched, huge increases in company valuations and numerous initial public offerings. The 140 highest-valued publicly traded renewable energy companies now have a combined market capitalisation of over $100 billion.

futu[r]e investment | GLOBAL MARKET OVERVIEW

Major industrial growth is occurring in a number of emerging renewable technologies, including thin-film solar PV, concentrating

7

solar thermal power generation and advanced or second generation

bio fuels. Worldwide employment in renewable energy

manufacturing, operation and maintenance exceeded 2.4 million

jobs in 2006, including some 1.1 million in bio fuels production.

The main reason for this industrial expansion is that national targets for renewable energy have been adopted in at least 66 countries worldwide, including all 27 European Union member states, 29 US states and nine Canadian provinces. Most targets are for a percentage of electricity production or primary energy to be achieved by a specific future year. There is now an EU-wide target, for example, for 20 % of energy to come from renewables by 2020 and a Chinese target of 15 %. Targets for bio fuel use in transport energy also now exist in several countries, including an EU-wide target for 10 % by 2020.

Specific policies to promote renewables have also mushroomed in recent years. At least 60 countries - 37 developed and transition countries and 23 developing countries - have adopted some type of policy to promote renewable power generation. The most common is the feed-in law, through which a set premium price is paid for each unit of renewable power generation. By 2007, at least 37 countries and nine states or provinces had adopted feed-in policies, more than half of which have been enacted since 2002. At least 44 states, provinces and countries have enacted renewable portfolio standards (RPS), which place an obligation on energy companies to source a rising percentage of their power from renewable sources. Other forms of support for renewable power generation include capital investment subsidies or rebates, tax incentives and credits, sales tax and value-added tax exemptions, net metering, public investment or financing and public competitive bidding.

Beneath a national and state level, municipalities around the world are also setting targets for future shares of renewable energy, typically in the range of 10­20 %. Some cities have established carbon dioxide reduction targets, others are enacting policies to promote solar hot water and solar PV or introducing urban planning rules which incorporate renewable energy. Market facilitation organisations are supporting the growth of renewable energy markets and policies through networking, market research, training, project facilitation, consulting, financing, policy advice and other technical assistance. There are now hundreds of such organisations around the world, including industry associations, non-governmental organisations, multilateral and bilateral development agencies, international partnerships and government agencies.

growth rates of the renewable energy industry
Figure 7.2 shows that many renewable energy technologies grew at rates of 15­30 % annually during the five year period 2002­2006, including wind power, solar hot water, geothermal heating and offgrid solar PV. Grid-connected solar PV eclipsed all of these, with a 60 % annual average growth rate for the period. Bio fuels also grew rapidly during the period, at a 40 % annual average for biodiesel and 15 % for ethanol. Other technologies are growing more slowly, at 3­5 %, including large hydropower, biomass power and heat, and geothermal power, although in some countries these technologies are growing much more rapidly than the global average.
These expansion rates compare with the global growth rates for fossil fuels of 2­4 % in recent years (higher in some developing countries)35.

future growth rates
In order to get a better understanding of what different technologies can deliver, however, it is necessary to examine more closely how future production capacities can be achieved from the current baseline. The wind industry, for example, has a current annual production capacity of about 25,000 MW. If this output were not expanded, total capacity would reach 650 GW by the year 2050. This includes the need for "repowering" of older wind turbines after 20 years. But according to this scenario the share of wind electricity in global production by 2050 would need to grow from today's 1% to 4.5% under the Reference Scenario and 6.5% under the Energy [R]evolution pathway.

A relatively modest expansion from today's 25 GW production capacity, however, to about 80 GW by 2020 and 100 GW in 2040 would lead to a total installed capacity of 1,800 GW in 2050, providing between 12% and 18% of world electricity demand.

The tables below provide an overview of current generation levels,

the capacities required under the Energy [R]evolution Scenario and

industry projections of a more advanced market growth. The good

news is that the scenario does not even come close to the limit of

the renewable industries' own projections. However, the scenario

assumes that at the same time strong energy efficiency measures

are taken in order to save resources and develop a more cost

7

optimised energy supply.

futu[r]e investment | FUTURE GROWTH RATES
investment in new power plants
The overall global level of investment required in new power plants up to 2030 will be in the region of $ 11 to 14 trillion. The main driver for investment in new generation capacity in OECD countries will be the ageing power plant fleet. Utilities will make their technology choices within the next five to ten years based on national energy policies, in particular market liberalisation, renewable energy and CO2 reduction targets. Within Europe, the EU emissions trading scheme may have a major impact on whether the majority of investment goes into fossil fuel power plants or renewable energy and
7 co-generation. In developing countries, international financial
institutions will play a major role in future technology choices.
The investment volume required to realise the Energy [R]evolution Scenario is $ 14.7 trillion, approximately 30% higher than in the Reference Scenario, which will require $ 11.3 trillion. Whilst the levels of investment in renewable energy and fossil fuels are almost equal under the Reference Scenario, with about $ 4.5 trillion each up to 2030, the Energy [R]evolution Scenario shifts about 80% of investment towards renewable energy. The fossil fuel share of power sector investment is focused mainly on combined heat and power and efficient gas-fired power plants.
The average annual investment in the power sector under the Energy [R]evolution Scenario between 2005 and 2030 is approximately $ 590 billion. This is equal to the current amount of subsidies for fossil fuels globally in less than two years. Most investment in new power generation will take place in China, followed by North America and Europe. South Asia, including India, and East Asia, including Indonesia, Thailand and the Philippines, will also be `hot spots' of new power generation investment.

renewable power generation investment
Under the Reference Scenario the investment expected in renewable electricity generation will be $ 4.7 trillion. This compares with $ 8.9 trillion in the Energy [R]evolution Scenario. The regional distribution in the two scenarios, however, is almost the same.
How investment is divided between the different renewable power generation technologies depends on their level of technical development. Technologies like wind power, which in some regions with good wind resources is already cost competitive with conventional fuels, will take a larger investment volume and a bigger market share. The market volume by technology and region also depends on the local resources and policy framework.
For solar photovoltaics, the main market will remain for some years in Europe and the US, but will soon expand across China and India. Because solar PV is a highly modular and decentralised technology which can be used almost everywhere, its market will eventually be spread across the entire world.

Concentrated solar power systems, on the other hand, can only be operated within the world's sunbelt regions. The main investment in this technology will therefore take place in North Africa, the Middle East, parts of the USA and Mexico, as well as south-west China, India, Australia and southern Europe.
The main development of the wind industry will take place in Europe, North America and China. Offshore wind technology will take a larger share from roughly 2015 onwards. The main offshore wind development will take place in North Europe and North America.
The market for geothermal power plants will be mainly in North America and East Asia. The USA, Indonesia and the Philippines, and some countries of central and southern Africa, have the highest potential over the next 20 years. After 2030, geothermal generation will expand to other parts of the world, including Europe and India.
Bio energy power plants will be distributed across the whole world as there is potential almost everywhere for biomass and/or biogas (cogeneration) power plants.

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GLOBAL ENERGY [R]EVOLUTION A SUSTAINABLE GLOBAL ENERGY OUTLOOK

fossil fuel power generation investment

Under the Reference Scenario, the main market expansion for new fossil fuel power plants will be in China, followed by North America, which will have a volume equal to India and Europe combined. In the Energy [R]evolution Scenario the overall investment in fossil fuel power stations up to 2030 will be $ 2,600 billion, significantly lower than the Reference Scenario's $ 4,500 billion.

China will be by far the largest investor in coal power plants in both

scenarios. While in the Reference Scenario the growth trend of the

7

current decade (2000­2010) will continue towards 2030, the Energy [R]evolution Scenario assumes that in the second and third

decades (2011-2030) growth slows down significantly. In the

Reference Scenario the massive expansion of coal firing is due to

activity in China, followed by the USA, India, East Asia and Europe.

The total cost for fossil fuel investment in the Reference Scenario between 2005 and 2030 amounts to $ 80.6 trillion, compared to $ 61.8 trillion in the Energy [R]evolution Scenario.This means that fuel costs in the Energy [R]evolution Scenario are already about 25% lower by 2030 and will be

50% lower by 2050. Although the investment in gas-fired power stations and cogeneration plants is about the same in both scenarios, the finance committed to oil and coal for electricity generation in the Energy [R]evolution Scenario is almost 30% below the Reference version.
fuel cost savings with renewables
Because renewable energy has no fuel costs, the total fuel cost savings in the Energy [R]evolution Scenario reach a total of $18.7 trillion, or $ 750 billion per year. A comparison between the extra fuel costs associated with the Reference Scenario and the extra investment costs of the Energy [R]evolution version shows that the average annual additional fuel costs are about five times higher than the additional investment requirements of the alternative scenario. In fact, the additional costs for coal fuel from today until the year 2030 are as high as $ 15.9 trillion: this would cover the entire investment in renewable and cogeneration capacity required to implement the Energy [R]evolution Scenario. These renewable energy sources will produce electricity without any further fuel costs beyond 2030, while the costs for coal and gas will continue to be a burden on national economies.


"the issue of security of supply is now at the top of the energy policy agenda."
GREENPEACE INTERNATIONAL CLIMATE CAMPAIGN
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GLOBAL ENERGY [R]EVOLUTION A SUSTAINABLE GLOBAL ENERGY OUTLOOK

energy resources & security of supply | OIL - RESERVES CHAOS

The issue of security of supply is now at the top of the energy policy agenda. Concern is focused both on price security and the security of physical supply. At present around 80% of global energy demand is met by fossil fuels. The unrelenting increase in energy demand is matched by the finite nature of these sources. The regional distribution of oil and gas resources, on the other hand, does not match the distribution of demand. Some countries have to rely almost entirely on fossil fuel imports. The maps on the following pages provide an overview of the availability of different fuels and their regional distribution. Information in this chapter is based partly on the report `Plugging the Gap'36.
oil
8
Oil is the lifeblood of the modern global economy, as the effects of the supply disruptions of the 1970s made clear. It is the number one source of energy, providing 36% of the world's needs and the fuel employed almost exclusively for essential uses such as transportation. However, a passionate debate has developed over the ability of supply to meet increasing consumption, a debate obscured by poor information and stirred by recent soaring prices.

the reserves chaos
Public data about oil and gas reserves is strikingly inconsistent, and potentially unreliable for legal, commercial, historical and sometimes political reasons. The most widely available and quoted figures, those from the industry journals Oil & Gas Journal and World Oil, have limited value as they report the reserve figures provided by companies and governments without analysis or verification. Moreover, as there is no agreed definition of reserves or standard reporting practice, these figures usually stand for different physical and conceptual magnitudes. Confusing terminology (`proved', `probable', `possible', `recoverable', `reasonable certainty') only adds to the problem.
Historically, private oil companies have consistently underestimated their reserves to comply with conservative stock exchange rules and through natural commercial caution. Whenever a discovery was made, only a portion of the geologist's estimate of recoverable resources was reported; subsequent revisions would then increase the reserves from that same oil field over time. National oil companies, mostly represented by OPEC (Organisation of Petroleum Exporting Countries), are not subject to any sort of accountability, so their reporting practices are even less clear. In the late 1980s, OPEC countries blatantly overstated their reserves while competing for production quotas, which were allocated as a proportion of the reserves. Although some revision was needed after the companies were nationalised, between 1985 and 1990, OPEC countries increased their joint reserves by 82%. Not only were these dubious revisions never corrected, but many of these countries have reported untouched reserves for years, even if no sizeable discoveries were made and production continued at the same pace. Additionally, the Former Soviet Union's oil and gas reserves have been overestimated by about 30% because the original assessments were later misinterpreted.
Whilst private companies are now becoming more realistic about the extent of their resources, the OPEC countries hold by far the majority of the reported reserves, and information on their resources is as unsatisfactory as ever. In brief, these information sources should be treated with considerable caution. To fairly estimate the world's oil resources a regional assessment of the mean backdated (i.e. `technical') discoveries would need to be performed.

gas
Natural gas has been the fastest growing fossil energy source in the last two decades, boosted by its increasing share in the electricity generation mix. Gas is generally regarded as an abundant resource and public concerns about depletion are limited to oil, even though few in-depth studies address the subject. Gas resources are more concentrated, and a few massive fields make up most of the reserves: the largest gas field in the world holds 15% of the `Ultimate Recoverable Resources' (URR), compared to 6% for oil. Unfortunately, information about gas resources suffers from the same bad practices as oil data because gas mostly comes from the same geological formations, and the same stakeholders are involved.
Most reserves are initially understated and then gradually revised upwards, giving an optimistic impression of growth. By contrast, Russia's reserves, the largest in the world, are considered to have been overestimated by about 30%. Owing to geological similarities, gas follows the same depletion dynamic as oil, and thus the same discovery and production cycles. In fact, existing data for gas is of worse quality than for oil, with ambiguities arising over the amount produced partly because flared and vented gas is not always accounted for. As opposed to published reserves, the technical ones have been almost constant since 1980 because discoveries have roughly matched production.

coal

Coal was the world's largest source of primary energy until it was overtaken by oil in the 1960s. Today, coal supplies almost one quarter of the world's energy. Despite being the most abundant of fossil fuels, coal's development is currently threatened by environmental concerns; hence its future will unfold in the context of both energy security and global warming.

Coal is abundant and more equally distributed throughout the world

than oil and gas. Global recoverable reserves are the largest of all

fossil fuels, and most countries have at least some. Moreover, existing

and prospective big energy consumers like the US, China and India

are self-sufficient in coal and will be for the foreseeable future. Coal

has been exploited on a large scale for two centuries, so both the

8

product and the available resources are well known; no substantial

new deposits are expected to be discovered. Extrapolating the

demand forecast forward, the world will consume 20% of its current

reserves by 2030 and 40% by 2050. Hence, if current trends are

maintained, coal would still last several hundred years.

energy resources & security of supply | GAS - COAL
nuclear
Uranium, the fuel used in nuclear power plants, is a finite resource whose economically available reserves are limited. Its distribution is almost as concentrated as oil and does not match regional consumption. Five countries - Canada, Australia, Kazakhstan, Russia and Niger - control three quarters of the world's supply. As a significant user of uranium, however, Russia's reserves will be exhausted within ten years.
Secondary sources, such as old deposits, currently make up nearly half of worldwide uranium reserves. However, those will soon be used up. Mining capacities will have to be nearly doubled in the next few years to meet current needs.

A joint report by the OECD Nuclear Energy Agency37 and the International Atomic Energy Agency estimates that all existing nuclear power plants will have used up their nuclear fuel, employing current technology, within less than 70 years. Given the range of scenarios for the worldwide development of nuclear power, it is likely that uranium supplies will be exhausted sometime between 2026 and 2070. This forecast includes the use of mixed oxide fuel (MOX), a mixture of uranium and plutonium.

and future predictions for

the E[R] scenario.

renewable energy
Nature offers a variety of freely available options for producing energy. Their exploitation is mainly a question of how to convert sunlight, wind, biomass or water into electricity, heat or power as efficiently, sustainably and cost-effectively as possible.
On average, the energy in the sunshine that reaches the Earth is about one kilowatt per square metre worldwide. According to the Research Association for Solar Power, power is gushing from renewable energy sources at a rate of 2,850 times more energy than is needed in the world. In one day, the sunlight which reaches the Earth produces enough energy to satisfy the world's current power requirements for eight years. Even though only a percentage of that
8 potential is technically accessible, this is still enough to provide just
under six times more power than the world currently requires.

definition of types of energy resource potential38
theoretical potential The theoretical potential identifies the physical upper limit of the energy available from a certain source. For solar energy, for example, this would be the total solar radiation falling on a particular surface.
conversion potential This is derived from the annual efficiency of the respective conversion technology. It is therefore not a strictly defined value, since the efficiency of a particular technology depends on technological progress.
technical potential This takes into account additional restrictions regarding the area that is realistically available for energy generation. Technological, structural and ecological restrictions, as well as legislative requirements, are accounted for.
economic potential The proportion of the technical potential that can be utilised economically. For biomass, for example, those quantities are included that can be exploited economically in competition with other products and land uses.
sustainable potential This limits the potential of an energy source based on evaluation of ecological and socio-economic factors.

energy resources & security of supply | RENEWABLE ENERGY

renewable energy potential by region and technology
Based on the report `Renewable Energy Potentials' from REN 21, a global policy network39, we can provide a more detailed overview of renewable energy prospects by world region and technology. The table below focuses on large economies, which consume 80 % of the world's primary energy and produce a similar share of the world's greenhouse gas emissions.
Solar photovoltaic (PV) technology can be harnessed almost everywhere, and its technical potential is estimated at over 1,500 EJ/year, closely followed by concentrating solar thermal power (CSP). These two cannot simply be added together, however, because they would require much of the same land resources. The onshore wind potential is equally vast, with almost 400 EJ/year available beyond the order of magnitude of future electricity consumption. The estimate for offshore wind potential (22 EJ/year) is cautious, as only wind intensive areas on ocean shelf areas, with a relatively shallow water depth, and outside shipping lines and

protected areas, are included. The various ocean or marine energy potentials also reach a similar magnitude, most of it from ocean waves. Cautious estimates reach a figure of around 50 EJ/year. The estimates for hydro and geothermal resources are well established, each having a technical potential of around 50 EJ/year. Those figures should be seen in the context of a current global energy demand of around 500 EJ.
In terms of heating and cooling, apart from using biomass, there is the option of using direct geothermal energy. The potential is extremely large and could cover 20 times the current world energy demand for heat. The potential for solar heating, including passive solar building design, is virtually limitless. However, heat is costly to transport and one should only consider geothermal heat and solar
water heating potentials which are sufficiently close to the point of 8
consumption. Passive solar technology, which contributes enormously to the provision of heating services, is not considered as a (renewable energy) supply source in this analysis but as an efficiency factor to be taken into account in the demand forecasts.
the global potential for sustainable biomass
As part of background research for the Energy [R]evolution Scenario, Greenpeace commissioned the German Biomass Research Centre, the former Institute for Energy and Environment, to investigate the worldwide potential for energy crops in different scenarios up to 2050. In addition, information has been compiled from scientific studies of the worldwide potential and from data derived from state of the art remote sensing techniques such as satellite images. A summary of the report's findings is given below; references can be found in the full report.
assessment of biomass potential studies
8 Various studies have looked historically at the potential for bio
energy and come up with widely differing results. Comparison between them is difficult because they use different definitions of the various biomass resource fractions. This problem is particularly significant in relation to forest derived biomass. Most research has focused almost exclusively on energy crops, as their development is considered to be more significant for satisfying the demand for bio energy. The result is that the potential for using forest residues (wood left over after harvesting) is often underestimated.
Data from 18 studies has been examined, with a concentration on those studies which report the potential for biomass residues. Among these there were ten comprehensive assessments with more or less detailed documentation of the methodology. The majority focus on the long-term potential for 2050 and 2100. Little information is available for 2020 and 2030. Most of the studies were published within the last ten years. Figure 8.2 shows the variations in potential by biomass type from the different studies.
figure 8.2: ranges of potentials for different resource categories

Looking at the contribution of individual resources to the total biomass potential, the majority of studies agree that the most promising resource is energy crops from dedicated plantations. Only six give a regional breakdown, however, and only a few quantify all types of residues separately. Quantifying the potential of minor fractions, such as animal residues and organic wastes, is difficult as the data is relatively poor.


potential of energy crops
Apart from the utilisation of biomass from residues, the cultivation of energy crops in agricultural production systems is of greatest significance. The technical potential for growing energy crops has been calculated on the assumption that demand for food takes priority. As a first step the demand for arable and grassland for food production has been calculated for each of 133 countries in different scenarios. These scenarios are:
· Business as usual (BAU) scenario: Present agricultural activity continues for the foreseeable future
· Basic scenario: No forest clearing; reduced use of fallow areas for agriculture
· Sub-scenario 1: Basic scenario plus expanded ecological protection areas and reduced crop yields
· Sub-scenario 2: Basic scenario plus food consumption reduced in industrialised countries
· Sub-scenario 3: Combination of sub-scenarios 1 and 2

In a next step the surpluses of agricultural areas were classified either as arable land or grassland. On grassland, hay and grass silage are produced, on arable land fodder silage and Short Rotation Coppice (such as fast-growing willow or poplar) are cultivated. Silage of green fodder and grass are assumed to be used for biogas production, wood from SRC and hay from grasslands for the production of heat, electricity and synthetic fuels. Country specific yield variations were taken into consideration.
The result is that the global biomass potential from energy crops in 2050 falls within a range from 6 EJ in Sub-scenario 1 up to 97 EJ in the BAU scenario.
The best example of a country which would see a very different future
under these scenarios in 2050 is Brazil. Under the BAU scenario large 8
agricultural areas would be released by deforestation, whereas in the Basic and Sub 1 scenarios this would be forbidden, and no agricultural areas would be available for energy crops. By contrast a high potential would be available under Sub-scenario 2 as a consequence of reduced meat consumption. Because of their high populations and relatively small agricultural areas, no surplus land is available for energy crop production in Central America, Asia and Africa. The EU, North America and Australia, however, have relatively stable potentials.

The results of this exercise show that the availability of biomass resources is not only driven by the effect on global food supply but the conservation of natural forests and other biospheres. So the assessment of future biomass potential is only the starting point of a discussion about the integration of bioenergy into a renewable energy system.

The total global biomass potential (energy crops and residues) therefore ranges in 2020 from 66 EJ (Sub-scenario 1) up to 110 EJ (Sub-scenario 2) and in 2050 from 94 EJ (Sub-scenario 1) to 184 EJ (BAU scenario). These numbers are conservative and include a level of uncertainty, especially for 2050. The reasons for this uncertainty are the potential effects of climate change, possible changes in the worldwide political and economic situation, a higher yield as a result of changed agricultural techniques and/or faster development in plant breeding.
This chapter describes the range of technologies available now and in the future to satisfy the world's energy demand. The Energy [R]evolution Scenario is focused on the potential for energy savings and renewable sources, primarily in the electricity and heat generating sectors. Although fuel use in transport is accounted for in the scenarios of future energy supply, no detailed description is given here of fuel sources, such as bio fuels for vehicles, which offer an alternative to the currently predominant oil.
fossil fuel technologies
The most commonly used fossil fuels for power generation around the world are coal and gas. Oil is still used where other fuels are not readily available, for example islands or remote sites, or where there is an indigenous resource. Together, coal and gas currently account for over half of global electricity supply.
coal combustion technologies In a conventional coal-fired power station, pulverised or powdered coal is blown into a combustion chamber where it is burnt at high temperature. The hot gases and heat produced converts water flowing through pipes lining the boiler into steam. This drives a steam turbine and generates electricity. Over 90% of global coal-fired capacity uses this system. Coal power stations can vary in capacity from a few hundred megawatts up to several thousand.
A number of technologies have been introduced to improve the environmental performance of conventional coal combustion. These include coal cleaning (to reduce the ash content) and various `bolton' or `end-of-pipe' technologies to reduce emissions of particulates, sulphur dioxide and nitrogen oxide, the main pollutants resulting from coal firing apart from carbon dioxide. Flue gas desulphurisation (FGD), for example, most commonly involves `scrubbing' the flue gases using an alkaline sorbent slurry, which is predominantly lime or limestone based.

More fundamental changes have been made to the way coal is burned to both improve its efficiency and further reduce emissions of pollutants. These include:

· Integrated Gasification Combined Cycle: Coal is not burnt directly but reacted with oxygen and steam to form a synthetic gas composed mainly of hydrogen and carbon monoxide. This is cleaned and then burned in a gas turbine to generate electricity and produce steam to drive a steam turbine. IGCC improves the efficiency of coal combustion from 38-40% up to 50%.

· Supercritical and Ultrasupercritical: These power plants operate at higher temperatures than conventional combustion, again increasing efficiency towards 50%.

· Fluidised Bed Combustion: Coal is burned in a reactor

comprised of a bed through which gas is fed to keep the fuel in

a turbulent state. This improves combustion, heat transfer and the

recovery of waste products. By elevating pressures within a bed,

a high-pressure gas stream can be used to drive a gas turbine,

9

generating electricity. Emissions of both sulphur dioxide and

nitrogen oxide can be reduced substantially.

energy technologies | FOSSIL FUEL

· Pressurised Pulverised Coal Combustion: Mainly being developed in Germany, this is based on the combustion of a finely ground cloud of coal particles creating high pressure, high temperature steam for power generation. The hot flue gases are used to generate electricity in a similar way to the combined cycle system.

Other potential future technologies involve the increased use of coal gasification. Underground Coal Gasification, for example, involves converting deep underground unworked coal into a combustible gas which can be used for industrial heating, power generation or the manufacture of hydrogen, synthetic natural gas or other chemicals. The gas can be processed to remove CO2 before it is passed on to end users. Demonstration projects are underway in Australia, Europe, China and Japan.

gas combustion technologies Natural gas can be used for electricity generation through the use of either gas turbines or steam turbines. For the equivalent amount of heat, gas produces about 45% less carbon dioxide during its combustion than coal.

Gas turbine plants use the heat from gases to directly operate the turbine. Natural gas fuelled turbines can start rapidly, and are therefore often used to supply energy during periods of peak demand, although at higher cost than baseload plants.

Particularly high efficiencies can be achieved through combining gas turbines with a steam turbine in combined cycle mode. In a combined cycle gas turbine (CCGT) plant, a gas turbine generator produces electricity and the exhaust gases from the turbine are then used to make steam to generate additional electricity. The efficiency of modern CCGT power stations can be more than 50%. Most new gas power plants built since the 1990s have been of this type.

At least until the recent increase in global gas prices, CCGT power stations have been the cheapest option for electricity generation in many countries. Capital costs have been substantially lower than for coal and nuclear plants and construction time shorter.

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GLOBAL ENERGY [R]EVOLUTION A SUSTAINABLE GLOBAL ENERGY OUTLOOK

energy technologies | FOSSIL FUEL

carbon reduction technologies Whenever coal or gas is burned, carbon dioxide (CO2) is produced. Depending on the type of power plant, a large quantity of the gas will dissipate into the atmosphere and contribute to climate change. A hard coal power plant discharges roughly 720 grammes of carbon dioxide per kilowatt hour, a modern gas-fired plant about 370g CO2/kWh. To ensure that no CO2 emerges from the power plant chimney, the gas must first be removed, and then stored somewhere. Both carbon capture and storage (CCS) have limitations. Even after employing proposed capture technologies, a residual amount of carbon dioxide - between 60 and 150g CO2/kWh - will continue to be emitted.
carbon dioxide storage CO2 captured at the point of incineration has to be stored somewhere. Current thinking is that it can be trapped in the oceans or under the Earth's surface at a depth of over 3,000 feet. As with nuclear waste, however, the question is whether this will just displace the problem elsewhere.
9
Ocean storage could result in greatly accelerated acidification of large sea areas and would be detrimental to a great many organisms, if not entire ecosystems, in the vicinity of injection sites. CO2 disposed of in this way is likely to get back into the atmosphere in a relatively short time. The oceans are both productive resources and a common natural endowment for this and future generations. Given the diversity of other options available for dealing with CO2 emissions, direct disposal to the ocean, sea floor, lakes and other open reservoir structures must be ruled out.
Among the options available for underground storage, empty oil and gas fields are riddled with holes drilled during their exploration and production phases. These holes have to be sealed over. Normally special cement is used, but carbon dioxide is relatively reactive with water and attacks metals or cement, so that even sealed drilling holes present a safety hazard. To many experts the question is not if but when leakages will occur.
Because of the lack of experience with CO2 storage, its safety is often compared to the storage of natural gas. This technology has been tried and tested for decades and is considered by industry to be low risk. Greenpeace does not share this assessment. A number of serious leaks from gas storage installations have occurred around the world, sometimes requiring evacuation of nearby residents.
Sudden leakage of CO2 can be fatal. Carbon dioxide is not itself poisonous, and is contained (approx. 0.04 per cent) in the air we breathe. But as concentrations increase it displaces the vital oxygen in the air. Air with concentrations of 7 to 8% CO2 by volume causes death by suffocation after 30 to 60 minutes.
There are also health hazards when large amounts of CO2 are explosively released. Although the gas normally disperses quickly after leaking, it can accumulate in depressions in the landscape or closed buildings, since carbon dioxide is heavier than air. It is equally dangerous when it escapes more slowly and without being noticed in residential areas, for example in cellars below houses.
The dangers from such leaks are known from natural volcanic CO2 degassing. Gas escaping at the Lake Nyos crater lake in Cameroon, Africa in 1986 killed over 1,700 people. At least ten people have died in the Lazio region of Italy in the last 20 years as a result of CO2 being released.
134

carbon storage and climate change targets Can carbon storage contribute to climate change reduction targets? In order to avoid dangerous climate change, we need to reduce CO2 globally by 50% in 2050. Power plants that store CO2 are still being developed, however, and could only become reality in 15 years at the earliest. This means they will not make any substantial contribution towards protecting the climate until the year 2020 at the earliest. They are thus irrelevant to the goals of the Kyoto Protocol.
Nor is CO2 storage of any great help in attaining the goal of an 80% reduction by 2050 in OECD countries. If it does become available in 2020, most of the world's new power plants will have just finished being modernised. All that could then be done would be for existing power plants to be retrofitted and CO2 captured from the waste gas flow. As retrofitting existing power plants is highly expensive, a high carbon price would be needed.
Employing CO2 capture will also increase the price of electricity from fossil fuels. Although the costs of storage depend on many factors, including the technology used for separation, transport and the storage installation, experts from the UN Intergovernmental Panel on Climate Change calculate the additional costs at between 3.5 and 5.0 cents/kWh of power. Since modern wind turbines in good wind locations are already cost competitive with new build coal-fired power plants today, the costs will probably be at the top end. This means the technology would more than double the cost of electricity.
The conclusion reached in the Energy [R]evolution Scenario is that renewable energy sources are already available, in many cases cheaper, and without the negative environmental impacts that are associated with fossil fuel exploitation, transport and processing. It is renewable energy together with energy efficiency and energy conservation ­ and not carbon capture and storage ­ that has to increase worldwide so that the primary cause of climate change ­ the burning of fossil fuels like coal, oil and gas ­ is stopped.
Greenpeace opposes any CCS efforts which lead to:
· The undermining or threats to undermine existing global and regional regulations governing the disposal of wastes at sea (in the water column, at or beneath the seabed).
· Continued or increasing finance to the fossil fuel sector at the expense of renewable energy and energy efficiency.
· The stagnation of renewable energy, energy efficiency and energy conservation improvements.
· The promotion of this possible future technology as the only major solution to climate change, thereby leading to new fossil fuel developments ­ especially lignite and black coal-fired power plants, and an increase in emissions in the short to medium term.

image SELLAFIELD NUCLEAR PLANT, CUMBRIA, UK.
image TEMELÍN NUCLEAR POWER PLANT IN THE CZECH REPUBLIC.

© GP/CUNNINGHAM © JURA/DREAMSTIME

nuclear technologies
Generating electricity from nuclear power involves transferring the heat produced by a controlled nuclear fission reaction into a conventional steam turbine generator. The nuclear reaction takes place inside a core and surrounded by a containment vessel of varying design and structure. Heat is removed from the core by a coolant (gas or water) and the reaction controlled by a moderating element or "moderator".
Across the world over the last two decades there has been a general slowdown in building new nuclear power stations. This has been caused by a variety of factors: fear of a nuclear accident, following the events at Three Mile Island, Chernobyl and Monju, increased scrutiny of economics and environmental factors, such as waste management and radioactive discharges.
nuclear reactor designs: evolution and safety issues At the beginning of 2005 there were 441 nuclear power reactors operating in 31 countries around the world. Although there are dozens of different reactor designs and sizes, there are three broad categories either currently deployed or under development. These are:
Generation I: Prototype commercial reactors developed in the 1950s and 1960s as modified or enlarged military reactors, originally either for submarine propulsion or plutonium production.
Generation II: Mainstream reactor designs in commercial operation worldwide.
Generation III: New generation reactors now being built.
Generation III reactors include the so-called Advanced Reactors, three of which are already in operation in Japan, with more under construction or planned. About 20 different designs are reported to be under development40, most of them `evolutionary' designs developed from Generation II reactor types with some modifications, but without introducing drastic changes. Some of them represent more innovative approaches. According to the World Nuclear Association, reactors of Generation III are characterised by the following:
· A standardised design for each type to expedite licensing, reduce capital cost and construction time.
· A simpler and more rugged design, making them easier to operate and less vulnerable to operational upsets.
· Higher availability and longer operating life, typically 60 years.
· Reduced possibility of core melt accidents.
· Minimal effect on the environment.
· Higher burn-up to reduce fuel use and the amount of waste.
· Burnable absorbers (`poisons') to extend fuel life.

To what extent these goals address issues of higher safety standards, as opposed to improved economics, remains unclear.

Of the new reactor types, the European Pressurised Water Reactor (EPR) has been developed from the most recent Generation II designs to start operation in France and Germany41. Its stated goals are to improve safety levels - in particular, reduce the probability of a severe accident by a factor of ten, achieve mitigation of severe accidents by restricting their consequences to the plant itself, and reduce costs. Compared to its predecessors, however, the EPR displays several modifications which constitute a reduction of safety margins, including:

· The volume of the reactor building has been reduced by simplifying the layout of the emergency core cooling system, and by using the results of new calculations which predict less hydrogen development during an accident.

· The thermal output of the plant has been increased by 15%

9

relative to existing French reactors by increasing core outlet

temperature, letting the main coolant pumps run at higher

capacity and modifying the steam generators.

energy technologies | NUCLEAR

· The EPR has fewer redundant pathways in its safety systems than a German Generation II reactor.

Several other modifications are hailed as substantial safety improvements, including a `core catcher' system to control a meltdown accident. Nonetheless, in spite of the changes being envisaged, there is no guarantee that the safety level of the EPR actually represents a significant improvement. In particular, reduction of the expected core melt probability by a factor of ten is not proven. Furthermore, there are serious doubts as to whether the mitigation and control of a core melt accident with the core catcher concept will actually work.

Finally, Generation IV reactors are currently being developed with the aim of commercialisation in 20-30 years.

references 40 IAEA 2004; WNO 2004A 41 HAINZ 2004

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GLOBAL ENERGY [R]EVOLUTION A SUSTAINABLE GLOBAL ENERGY OUTLOOK

energy technologies | RENEWABLE ENERGY

renewable energy technologies
Renewable energy covers a range of natural sources which are constantly renewed and therefore, unlike fossil fuels and uranium, will never be exhausted. Most of them derive from the effect of the sun and moon on the Earth's weather patterns. They also produce none of the harmful emissions and pollution associated with `conventional' fuels. Although hydroelectric power has been used on an industrial scale since the middle of the last century, the serious exploitation of other renewable sources has a more recent history.
solar power (photovoltaics pv) There is more than enough solar radiation available all over the world to satisfy a vastly increased demand for solar power systems. The sunlight which reaches the Earth's surface is enough to provide 2,850 times as much energy as we can currently use. On a global average, each square metre of land is exposed to enough sunlight to produce 1,700 kWh of power every
9 year.The average irradiation in Europe is about 1,000 kWh per square
metre, however, compared with 1,800 kWh in the Middle East.
Photovoltaic (PV) technology involves the generation of electricity from light. The secret to this process is the use of a semiconductor material which can be adapted to release electrons, the negatively charged particles that form the basis of electricity. The most common semiconductor material used in photovoltaic cells is silicon, an element most commonly found in sand. All PV cells have at least two layers of such semiconductors, one positively charged and one negatively charged. When light shines on the semiconductor, the electric field across the junction between these two layers causes electricity to flow. The greater the intensity of the light, the greater the flow of electricity. A photovoltaic system does not therefore need bright sunlight in order to operate, and can generate electricity even on cloudy days. Solar PV is different from a solar thermal collecting system (see below) where the sun's rays are used to generate heat, usually for hot water in a house, swimming pool etc.
The most important parts of a PV system are the cells which form the basic building blocks, the modules which bring together large numbers of cells into a unit, and, in some situations, the inverters used to convert the electricity generated into a form suitable for everyday use. When a PV installation is described as having a capacity of 3 kWp (peak), this refers to the output of the system under standard testing conditions, allowing comparison between different modules. In central Europe a 3 kWp rated solar electricity system, with a surface area of approximately 27 square metres, would produce enough power to meet the electricity demand of an energy conscious household.

types of PV system
· grid connected The most popular type of solar PV system for homes and businesses in the developed world. Connection to the local electricity network allows any excess power produced to be sold to the utility. Electricity is then imported from the network outside daylight hours. An inverter is used to convert the DC power produced by the system to AC power for running normal electrical equipment.
· grid support A system can be connected to the local electricity network as well as a back-up battery. Any excess solar electricity produced after the battery has been charged is then sold to the network. This system is ideal for use in areas of unreliable power supply.
· off-grid Completely independent of the grid, the system is connected to a battery via a charge controller, which stores the electricity generated and acts as the main power supply. An inverter can be used to provide AC power, enabling the use of normal appliances. Typical off-grid applications are repeater stations for mobile phones or rural electrification. Rural electrification means either small solar home systems covering basic electricity needs or solar mini grids, which are larger solar electricity systems providing electricity for several households.
· hybrid system A solar system can be combined with another source of power - a biomass generator, a wind turbine or diesel generator - to ensure a consistent supply of electricity. A hybrid system can be grid connected, stand alone or grid support.

figure 9.1: photovoltaics technology

1. LIGHT (PHOTONS)

2. FRONT CONTACT GRID

3. ANTI-REFLECTION COATING

1

4. N-TYPE SEMICONDUCTOR

5. BOARDER LAYOUT

6. P-TYPE SEMICONDUCTOR

7. BACKCONTACT 2

3 4 5

6

7

136

© CHRISTIAN KAISER/GP © GP/SOLNESS

image SOLAR PROJECT IN PHITSANULOK, THAILAND. SOLAR FACILITY OF THE INTERNATIONAL INSTITUTE AND SCHOOL FOR RENEWABLE ENERGY.
image SOLAR PANELS ON CONISTON STATION, NORTH WEST OF ALICE SPRINGS, NORTHERN TERRITORY.

concentrating solar power (CSP) Concentrating solar power (CSP) plants, also called solar thermal power plants, produce electricity in much the same way as conventional power stations. The difference is that they obtain their energy input by concentrating solar radiation and converting it to high temperature steam or gas to drive a turbine or motor engine. Large mirrors concentrate sunlight into a single line or point. The heat created there is used to generate steam. This hot, highly pressurised steam is used to power turbines which generate electricity. In sun-drenched regions, CSP plants can guarantee a large proportion of electricity production.
Four main elements are required: a concentrator, a receiver, some form of transfer medium or storage, and power conversion. Many different types of system are possible, including combinations with other renewable and non-renewable technologies, but the three most promising solar thermal technologies are:
· parabolic trough Trough-shaped mirror reflectors are used to concentrate sunlight on to thermally efficient receiver tubes placed in the trough's focal line. A thermal transfer fluid, such as synthetic thermal oil, is circulated in these tubes. Heated to approximately 400°C by the concentrated sun's rays, this oil is then pumped through a series of heat exchangers to produce superheated steam. The steam is converted to electrical energy in a conventional steam turbine generator, which can either be part of a conventional steam cycle or integrated into a combined steam and gas turbine cycle.
This is the most mature technology, with 354 MWe of plants connected to the Southern California grid since the 1980s and more than 2 million square metres of parabolic trough collectors installed worldwide.

· central receiver or solar tower A circular array of heliostats (large individually tracking mirrors) is used to concentrate sunlight on to a central receiver mounted at the top of a tower. A heattransfer medium absorbs the highly concentrated radiation reflected by the heliostats and converts it into thermal energy to be used for the subsequent generation of superheated steam for turbine operation. To date, the heat transfer media demonstrated include water/steam, molten salts, liquid sodium and air. If pressurised gas or air is used at very high temperatures of about 1,000°C or more as the heat transfer medium, it can even be used to directly replace natural gas in a gas turbine, thus making use of the excellent efficiency (60%+) of modern gas and steam combined cycles.

After an intermediate scaling up to 30 MW capacity, solar tower

developers now feel confident that grid-connected tower power

plants can be built up to a capacity of 200 MWe solar-only units.

Use of heat storage will increase their flexibility. Although solar

tower plants are considered to be further from commercialisation

than parabolic trough systems, they have good longer-term

9

prospects for high conversion efficiencies. Projects are being

developed in Spain, South Africa and Australia.

· parabolic dish A dish-shaped reflector is used to concentrate sunlight on to a receiver located at its focal point. The concentrated beam radiation is absorbed into the receiver to heat a fluid or gas to approximately 750°C. This is then used to generate electricity in a small piston, Stirling engine or a micro turbine, attached to the receiver.

The potential of parabolic dishes lies primarily for decentralised power supply and remote, stand-alone power systems. Projects are currently planned in the United States, Australia and Europe.

energy technologies | RENEWABLE ENERGY

figures 9.2: parabolic trough/central receiver or solar tower/parabolic dish technology

PARABOLIC TROUGH

CENTRAL RECEIVER
CENTRAL RECEIVER

PARABOLIC DISH

REFLECTOR ABSORBER TUBE SOLAR FIELD PIPING

HELIOSTATS

RECEIVER/ENGINE

REFLECTOR

137

GLOBAL ENERGY [R]EVOLUTION A SUSTAINABLE GLOBAL ENERGY OUTLOOK

solar thermal collectors Solar thermal collecting systems are based on a centuries-old principle: the sun heats up water contained in a dark vessel. Solar thermal technologies on the market now are efficient and highly reliable, providing energy for a wide range of applications - from domestic hot water and space heating in residential and commercial buildings to swimming pool heating, solar-assisted cooling, industrial process heat and the desalination of drinking water.

solar domestic hot water and space heating Domestic hot water production is the most common application. Depending on the conditions and the system's configuration, most of a building's hot water requirements can be provided by solar energy. Larger systems can additionally cover a substantial part of the energy needed for space heating. There are two main types of technology:

· vacuum tubes The absorber inside the vacuum tube absorbs

radiation from the sun and heats up the fluid inside. Additional

9

radiation is picked up from the reflector behind the tubes. Whatever the angle of the sun, the round shape of the vacuum

tube allows it to reach the absorber. Even on a cloudy day, when

the light is coming from many angles at once, the vacuum tube

collector can still be effective.

energy technologies | RENEWABLE ENERGY

· flat panel This is basically a box with a glass cover which sits on the roof like a skylight. Inside is a series of copper tubes with copper fins attached. The entire structure is coated in a black substance designed to capture the sun's rays. These rays heat up a water and antifreeze mixture which circulates from the collector down to the building's boiler.

solar assisted cooling Solar chillers use thermal energy to produce cooling and/or dehumidify the air in a similar way to a refrigerator or conventional air-conditioning. This application is well-suited to solar thermal energy, as the demand for cooling is often greatest when there is most sunshine. Solar cooling has been successfully demonstrated and large-scale use can be expected in the future.

figure 9.3: flat panel solar technology

wind power Over the last 20 years, wind energy has become the world's fastest growing energy source. Today's wind turbines are produced by a sophisticated mass production industry employing a technology that is efficient, cost effective and quick to install. Turbine sizes range from a few kW to over 5,000 kW, with the largest turbines reaching more than 100m in height. One large wind turbine can produce enough electricity for about 5,000 households. State-of-the-art wind farms today can be as small as a few turbines and as large as several hundred MW.
The global wind resource is enormous, capable of generating more electricity than the world's total power demand, and well distributed across the five continents. Wind turbines can be operated not just in the windiest coastal areas but in countries which have no coastlines, including regions such as central Eastern Europe, central North and South America, and central Asia. The wind resource out at sea is even more productive than on land, encouraging the installation of offshore wind parks with foundations embedded in the ocean floor. In Denmark, a wind park built in 2002 uses 80 turbines to produce enough electricity for a city with a population of 150,000.
Smaller wind turbines can produce power efficiently in areas that otherwise have no access to electricity. This power can be used directly or stored in batteries. New technologies for using the wind's power are also being developed for exposed buildings in densely populated cities.
wind turbine design Significant consolidation of wind turbine design has taken place since the 1980s. The majority of commercial turbines now operate on a horizontal axis with three evenly spaced blades. These are attached to a rotor from which power is transferred through a gearbox to a generator. The gearbox and generator are contained within a housing called a nacelle. Some turbine designs avoid a gearbox by using direct drive. The electricity output is then channelled down the tower to a transformer and eventually into the local grid network.
Wind turbines can operate from a wind speed of 3-4 metres per second up to about 25 m/s. Limiting their power at high wind speeds is achieved either by `stall' regulation ­ reducing the power output ­ or `pitch' control ­ changing the angle of the blades so that they no longer offer any resistance to the wind. Pitch control has become the most common method. The blades can also turn at a constant or variable speed, with the latter enabling the turbine to follow more closely the changing wind speed.

138

© PAUL LANGROCK/ZENIT/GP © P. PETERSEN/DREAMSTIME

image THE BIOENERGY VILLAGE OF JUEHNDE, WHICH IS THE FIRST COMMUNITY IN GERMANY THAT PRODUCES ALL ITS ENERGY NEEDED FOR HEATING AND ELECTRICITY WITH CO2 NEUTRAL BIOMASS.
image VESTAS VM 80 WIND TURBINES AT AN OFFSHORE WIND PARK IN THE WESTERN PART OF DENMARK.

The main design drivers for current wind technology are:
· high productivity at both low and high wind sites
· grid compatibility
· acoustic performance
· aerodynamic performance
· visual impact
· offshore expansion
Although the existing offshore market is only just over 1% of the world's land-based installed wind capacity, the latest developments in wind technology are primarily driven by this emerging potential. This means that the focus is on the most effective ways to make very large turbines.
Modern wind technology is available for a range of sites - low and high wind speeds, desert and arctic climates. European wind farms operate with high availability, are generally well integrated with the environment and accepted by the public. In spite of repeated predictions of a levelling off at an optimum mid-range size, and the fact that wind turbines cannot get larger indefinitely, turbine size has increased year on year from units of 20-60 kW in California in the 1980s up to the latest multi-MW machines with rotor diameters over 100 m. The average size of turbine installed around the world during 2007 was 1,492 kW, whilst the largest machine in operation is the Enercon E126, with a rotor diameter of 126 metres and a power capacity of 6 MW.
This growth in turbine size has been matched by the expansion of both markets and manufacturers. Almost 100,000 wind turbines now operate in over 50 countries around the world. The German market is the largest, but there has also been impressive growth in Spain, Denmark, India, China and the United States.

biomass energy Biomass is a broad term used to describe material of recent biological origin that can be used as a source of energy. This includes wood, crops, algae and other plants as well as agricultural and forest residues. Biomass can be used for a variety of end uses: heating, electricity generation or as fuel for transportation. The term `bio energy' is used for biomass energy systems that produce heat and/or electricity and `bio fuels' for liquid fuels used in transport. Biodiesel manufactured from various crops has become increasingly used as vehicle fuel, especially as the cost of oil has risen.
Biological power sources are renewable, easily stored, and, if sustainably harvested, CO2 neutral. This is because the gas emitted during their transfer into useful energy is balanced by the carbon dioxide absorbed when they were growing plants.
Electricity generating biomass power plants work just like natural
gas or coal power stations, except that the fuel must be processed 9
before it can be burned. These power plants are generally not as large as coal power stations because their fuel supply needs to grow as near as possible to the plant. Heat generation from biomass power plants can result either from utilising a Combined Heat and Power (CHP) system, piping the heat to nearby homes or industry, or through dedicated heating systems. Small heating systems using specially produced pellets made from waste wood, for example, can be used to heat single family homes instead of natural gas or oil.

biomass technology A number of processes can be used to convert energy from biomass. These divide into thermal systems, which involve direct combustion of solids, liquids or a gas via pyrolysis or gasification, and biological systems, which involve decomposition of solid biomass to liquid or gaseous fuels by processes such as anaerobic digestion and fermentation.

· thermal systems

Direct combustion is the most common way of converting

biomass to energy, for heat as well as electricity. Worldwide it

accounts for over 90% of biomass generation. Technologies can

be distinguished as either fixed bed, fluidised bed or entrained

flow combustion. In fixed bed combustion, such as a grate

furnace, primary air passes through a fixed bed, in which drying,

gasification and charcoal combustion takes place. The

combustible gases produced are burned after the addition of

secondary air, usually in a zone separated from the fuel bed. In

9

fluidised bed combustion, the primary combustion air is injected from the bottom of the furnace with such high velocity that the

material inside the furnace becomes a seething mass of particles

and bubbles. Entrained flow combustion is suitable for fuels

available as small particles, such as sawdust or fine shavings,

which are pneumatically injected into the furnace.

energy technologies | RENEWABLE ENERGY

Gasification Biomass fuels are increasingly being used with advanced conversion technologies, such as gasification systems, which offer superior efficiencies compared with conventional power generation. Gasification is a thermochemical process in which biomass is heated with little or no oxygen present to produce a low energy gas. The gas can then be used to fuel a gas turbine or combustion engine to generate electricity. Gasification can also decrease emission levels compared to power production with direct combustion and a steam cycle.

Pyrolysis is a process whereby biomass is exposed to high temperatures in the absence of air, causing the biomass to decompose. The products of pyrolysis always include gas (`biogas'), liquid (`bio-oil') and solid (`char'), with the relative proportions of each depending on the fuel characteristics, the method of pyrolysis and the reaction parameters, such as temperature and pressure. Lower temperatures produce more solid and liquid products and higher temperatures more biogas.

· biological systems These processes are suitable for very wet biomass materials such as food or agricultural wastes, including farm animal slurry.

Anaerobic digestion means the breakdown of organic waste by bacteria in an oxygen-free environment. This produces a biogas typically made up of 65% methane and 35% carbon dioxide. Purified biogas can then be used both for heating and electricity generation.

Fermentation Fermentation is the process by which growing plants with a high sugar and starch content are broken down with the help of micro-organisms to produce ethanol and methanol. The end product is a combustible fuel that can be used in vehicles.


Biomass power station capacities typically range up to 15 MW, but larger plants are possible of up to 400 MW capacity, with part of the fuel input potentially being fossil fuel, for example pulverised coal. The world's largest biomass fuelled power plant is located at Pietarsaari in Finland. Built in 2001, this is an industrial CHP plant producing steam (100 MWth) and electricity (240 MWe) for the local forest industry and district heat for the nearby town. The boiler is a circulating fluidised bed boiler designed to generate steam from bark, sawdust, wood residues, commercial bio fuel and peat.
A 2005 study commissioned by Greenpeace Netherlands concluded that it was technically possible to build and operate a 1,000 MWe biomass fired power plant using fluidised bed combustion technology and fed with wood residue pellets42.
bio fuels Converting crops into ethanol and bio diesel made from rapeseed methyl ester (RME) currently takes place mainly in Brazil, the USA and Europe. Processes for obtaining synthetic fuels from `biogenic synthesis' gases will also play a larger role in the future. Theoretically bio fuels can be produced from any biological carbon source, although the most common are photosynthetic plants. Various plants and plant-derived materials are used for bio fuel production. Globally bio fuels are most commonly used to power vehicles, but can also be used for other purposes. The production and use of bio fuels must result in a net reduction in carbon emissions compared to the use of traditional fossil fuels to have a positive effect in climate change mitigation. Sustainable bio fuels can reduce the dependency on petroleum and thereby enhance energy security.
Bio ethanol is a fuel manufactured through the fermentation of sugars. This is done by accessing sugars directly (sugar cane or beet) or by breaking down starch in grains such as wheat, rye, barley or maize. In the European Union bio ethanol is mainly produced from grains, with wheat as the dominant feedstock. In Brazil the preferred feedstock is sugar cane, whereas in the USA it is corn (maize). Bio ethanol produced from cereals has a by-product, a protein-rich animal feed called Dried Distillers Grains with Solubles (DDGS). For every tonne of cereals used for ethanol production, on average one third will enter the animal feed stream as DDGS. Because of its high protein level this is currently used as a replacement for soy cake. Bio ethanol can either be blended into gasoline (petrol) directly or be used in the form of ETBE (Ethyl Tertiary Butyl Ether).
Bio diesel is a fuel produced from vegetable oil sourced from rapeseed, sunflower seeds or soybeans as well as used cooking oils or animal fats. Bio diesel comes in a standard form as `mono-alkyl ester' and other kinds of diesel-grade fuels of biological origin are not included. In specific cases, used vegetable oils can be recycled as feedstock for bio diesel production. This can reduce the loss of used oils in the environment and provides a new way of transforming a waste into transport energy. Blends of bio diesel and conventional hydrocarbonbased diesel are the most common products distributed in the retail transport fuel market.
Most countries use a labelling system to explain the proportion of bio diesel in any fuel mix. Fuel containing 20% biodiesel is labelled B20, while pure bio diesel is referred to as B100. Blends of 20 % bio diesel with 80 % petroleum diesel (B20) can generally be used in unmodified diesel engines. Used in its pure form (B100) an engine may require certain modifications. Bio diesel can also be used as a heating fuel in domestic and commercial boilers. Older furnaces may contain rubber parts that would be affected by bio diesel's solvent properties, but can otherwise burn it without any conversion.


geothermal energy Geothermal energy is heat derived from deep underneath the Earth's crust. In most areas, this heat reaches the surface in a very diffuse state. However, due to a variety of geological processes, some areas, including the western part of the USA, west and central eastern Europe, Iceland, Asia and New Zealand are underlain by relatively shallow geothermal resources. These are classified as either low temperature (less than 90°C), moderate temperature (90° - 150°C) or high temperature (greater than 150°C). The uses to which these resources can be put depend on the temperature. The highest temperature is generally used only for electric power generation. Current global geothermal generation capacity totals approximately 8,000 MW. Uses for low and moderate temperature resources can be divided into two categories: direct use and ground-source heat pumps.
Geothermal power plants use the Earth's natural heat to vapourise water or an organic medium. The steam created then powers a turbine which produces electricity. In New Zealand and Iceland this technique has been used extensively for decades. In Germany, where it is necessary to drill many kilometres down to reach the necessary temperatures, it is only in the trial stages. Geothermal heat plants require lower temperatures and the heated water is used directly.

hydro power Water has been used to produce electricity for about a century. Today, around one fifth of the world's electricity is produced from hydro power. Large hydroelectric power plants with concrete dams and extensive collecting lakes often have very negative effects on the environment, however, requiring the flooding of habitable areas. Smaller `run-of-the-river' power stations, which are turbines powered by one section of running water in a river, can produce electricity in an environmentally friendly way.
The main requirement for hydro power is to create an artificial head so that water, diverted through an intake channel or pipe into a turbine, discharges back into the river downstream. Small hydro power is mainly `run-of-the-river' and does not collect significant amounts of stored water, requiring the construction of large dams and reservoirs. There are two broad categories of turbines: impulse turbines (notably the Pelton) in which a jet of water impinges on the runner designed to reverse the direction of the jet and thereby
extracts momentum from the water. This turbine is suitable for high 9
heads and `small' discharges. Reaction turbines (notably Francis and Kaplan) run full of water and in effect generate hydrodynamic `lift' forces to propel the runner blades. These turbines are suitable for medium to low heads, and medium to large discharges.


ocean energy tidal power Tidal power can be harnessed by constructing a dam or barrage across an estuary or bay with a tidal range of at least five metres. Gates in the barrage allow the incoming tide to build up in a basin behind it. The gates then close so that when the tide flows out the water can be channelled through turbines to generate electricity. Tidal barrages have been built across estuaries in France, Canada and China but a mixture of high cost projections coupled with environmental objections to the effect on estuarial habitats has limited the technology's further expansion.
9

wave and tidal stream power In wave power generation, a structure interacts with the incoming waves, converting this energy to electricity through a hydraulic, mechanical or pneumatic power take-off system. The structure is kept in position by a mooring system or placed directly on the seabed/seashore. Power is transmitted to the seabed by a flexible submerged electrical cable and to shore by a sub-sea cable.
Wave power converters can be made up from connected groups of smaller generator units of 100 ­ 500 kW, or several mechanical or hydraulically interconnected modules can supply a single larger turbine generator unit of 2 ­ 20 MW. The large waves needed to make the technology more cost effective are mostly found at great distances from the shore, however, requiring costly sub-sea cables to transmit the power. The converters themselves also take up large amounts of space. Wave power has the advantage of providing a more predictable supply than wind energy and can be located in the ocean without much visual intrusion.
There is no commercially leading technology on wave power conversion at present. Different systems are being developed at sea for prototype testing. The largest grid-connected system installed so far is the 2.25 MW Pelamis, with linked semi-submerged cyclindrical sections, operating off the coast of Portugal. Most development work has been carried out in the UK.


Using energy efficiently is cheaper than producing fresh energy and often has multiple positive effects. An efficient clothes washing machine or dishwasher, for example uses less power and less water. Efficiency also usually provides a higher level of comfort. A wellinsulated house, for instance, will feel warmer in the winter, cooler in the summer and be healthier to live in. An efficient refrigerator will make less noise, have no frost inside, no condensation outside and will probably last longer. Efficient lighting will offer you more light where you need it. Efficiency is thus really `more with less'.
There are very simple steps a householder can take, such as putting additional insulation in the roof, using super-insulating glazing or buying a high-efficiency washing machine when the old one wears out. All of these examples will save both money and energy. But the biggest savings will not be found in such incremental steps. The real gains come from rethinking the whole concept - `the whole house', `the whole car' or even `the whole transport system'. When you do this, energy needs can often be cut back by four to ten times.
In order to find out the global and regional energy efficiency
10 potential, the Dutch institute Ecofys developed energy demand
scenarios for this update of the Greenpeace Energy [R]evolution analysis. These scenarios cover energy demand over the period 2005-2050 for ten world regions. Two low energy demand scenarios for energy efficiency improvements have been defined. The first is based on the best technical energy efficiency potentials and is called `Technical'. The second is based on more moderate energy savings taking into account implementation constraints in terms of costs and other barriers. This scenario is called `Revolution'. The main results of the study are summarised below.
The starting point for the Ecofys analysis is that worldwide final energy demand is expected to grow by 95%, from 290 EJ in 2005 to 570 EJ in 2050, if we continue with business as usual. In the light of increasing fossil fuel prices, depleting resources and climate change, business as usual is simply not an option.

Final energy demand (EJ)

Growth in the transport sector is projected to be the largest, with energy demand expected to grow from 84 EJ in 2005 to 183 EJ in 2050. Demand for buildings and agriculture is expected to grow the least, from 91 EJ in 2005 to 124 EJ in 2050. Under the energy [r]evolution scenario, however, growth in energy demand can be limited to an increase of 28% up to 2050 in comparison to the 2005 level, whilst taking into account implementation constraints in terms of costs and other barriers. In Figure 10.2 the potential for energy efficiency improvements under this scenario are presented. The baseline is 2005 final energy demand per region. Table 10.1 shows that total worldwide energy demand has reduced to 376 PJ by 2050, with a breakdown by sector.
figure 10.1: reference scenario (business as usual) for worldwide final energy demand by sector

Since homes account for the largest share of energy demand from buildings, this section examines in detail the savings potential in households. Breakdowns of electricity use in the core EU-15 countries and the new member states are given in Figure 10.4 and Figure 10.5. A breakdown of electricity demand in the services sector can be found in Figure 10.6.
figure 10.4: breakdown of electricity use for residential end-use equipment in EU-15 countries in 2004
(BERTOLDI & ATANASIU, 2006)

Based on the results from three studies43, we have assumed the following breakdowns for energy use (fuel and electricity) under the Reference Scenario in 2050. Insufficient information is available to make a breakdown by world region. We assume however that the pattern for different regions will converge over the years.
Since an estimated 80% of fuel use in buildings is for space heating, the energy efficiency improvement potential here is considered to be large. In order to determine the potential for efficiency improvement in space heating we looked at the energy demand per m2 floor area per heating degree day (HDD). Heating degree days indicate the number of degrees that a day's average temperature is under 18°C, the temperature below which buildings
10 need to be heated.
The typical current heating demand for dwellings is 70-120 kJ/m2 44. Dwellings with a low energy use consume below 32 kJ/m2/, however, more than 70% less than the current level.

the low energy household
Technologies to reduce energy demand applied in this typical household are45:
· Triple-glazed windows with low emittance coatings. These windows greatly reduce heat loss to 40% compared to windows with one layer. The low emittance coating prevents energy waves in sunlight coming through, reducing the need for cooling.
· Insulation of roofs, walls, floors and basement. Proper insulation reduces heating and cooling demand by 50% in comparison to typical energy demand.
· Passive solar techniques make use of solar energy through the building's design - siting and window orientation. The term `passive' indicates that no mechanical equipment is used. All solar gains come through the windows.
· Balanced ventilation with heat recovery means that heated indoor air is channelled to a heat recovery unit and used to heat incoming outdoor air.
Current space heating demands in kJ per square metre per heating degree day for OECD dwellings are given in the table below.

space heating savings for new buildings We have assumed under the Energy [R]evolution Scenario that from 2010 onwards, all new dwellings will be low energy buildings using 48 kJ/m2/HDD. Since there is no data on current average energy consumption for dwellings in non-OECD countries, we have had to make assumptions for these regions. The potential for fuel savings46 is considered to be small in developing regions and about the same as the OECD in the Transition Economies. From this study we have taken the potential for developing regions to be equal to a 1.4% energy efficiency improvement per year, including replacing existing homes with more energy efficient housing (retrofitting). For the Transition Economies we have assumed the average OECD savings potential. For new homes, the savings compared to the average current dwelling are given in Table 10.4.

space heating savings by retrofit As well as constructing efficient new buildings there is a large savings potential to be found in retrofitting existing buildings. Important retrofit options are more efficient windows and insulation. According to the OECD/IEA, the first can save 39% of space heating energy demand while the latter can save 32% of space heating or cooling. Energy consumption in existing buildings in Europe could therefore decrease by more than 50%47. In OECD Europe and for the other regions we assume the same relative reductions as for new buildings, to take into account current average efficiency of dwellings in the regions. For existing homes, the savings compared to the average current dwelling are given in the table below.

In order to calculate the overall potential we need to know the share of new and existing buildings in 2050. The United Nations Economic Commission for Europe database48 contains data on the total housing stock, the increase from new construction and population. We have assumed that the total housing stock grows along with the population. The number of existing dwellings also decreases each year due to a certain level of replacement. On average this is about 1.3% of the total housing stock per year, meaning a 40% replacement over 40 years, the equivalent of an average house lifetime of 100 years. Figure 10.6 shows how the future housing stock could develop in The Netherlands.

references 46 ÜRGE-VORSATZ & NOVIKOVA (2008) 47 OECD/IEA,2006 48 UNECE, `HUMAN SETTLEMENT DATABASE', 2008
This example illustrates that new dwellings in The Netherlands (and therefore OECD Europe) make up 7% of the total housing stock in 2050 and retrofits account for 41%. Although the UNECE database does not have data for countries in all regions of the world, the percentages of new and retrofit houses in 2050 are not dependent on the absolute number of dwellings but only on the rate of population growth and the 1.3% assumption. This means that we can use the population growth to make forecasts for other regions (see Table 10.6).

1. standby power consumption Standby power consumption is the "lowest power consumption which cannot be switched off (influenced) by the user and may persist for an indefinite time when an appliance is connected to the mains electricity supply"49. In other words, the energy available when an appliance is connected to the power supply is not being used. Some appliances also consume energy when they are not on standby and are also not being used for their primary function, for example when an appliance has reached the end of a cycle but the `on' button is still engaged. This consumption does not fit into the definition of standby power but could still account for a substantial amount of energy use.
Reducing standby losses provides a major opportunity for costeffective energy savings. Nowadays, many appliances can be remotely and/or instantly activated or have a continuous digital display, and therefore require a standby mode. Standby power accounts for 20­90W per home in developed nations, ranging from 4 to 10% of total residential electricity use50 and 3-12% of total residential electricity use worldwide51. Printers use 30-40% of their full power requirement when idle, as do televisions and music equipment. Set-top boxes used in conjunction with televisions tend to consume even more energy on standby than in use. Typical standby use of different types of electrical devices is shown in Figure 10.8.
references 49 UNITED KINGDOM MARKET TRANSFORMATION PROGRAMME, `BNXS15: STANDBY POWER CONSUMPTION - DOMESTIC APPLIANCES', 2008 50 MEIER, A., J. LIN, J. LIU, T. LI, `STANDBY POWER USE IN CHINESE HOMES', ENERGY AND BUILDINGS 36, PP. 1211-1216, 2004 51 MEIER, A, `A WORLDWIDE REVIEW OF STANDBY POWER IN HOMES', LAWRENCE BERKELEY NATIONAL LABORATORY, UNIVERSITY OF CALIFORNIA, 2001

Globally, people consume 3 Mega-lumen-hrs (Mlmh) of residential electric light per capita/year. The average North American uses 13.2 Mlmh, the average Chinese 1.5 Mlmh - still 300 times the average artificial per capita light use in England in the nineteenth century. The average Japanese uses 18.5 Mlmh and the average European or Australian 2.7Mlmh. There is a clear relationship between GDP per capita and lighting consumption in Mlmh/cap/yr (see Figure 10.11).

It is important to realise that lighting energy savings are not just a question of using more efficient lamps but also involve other approaches. These include making smarter use of daylight, reducing light absorption by luminaires (the fixture in which the lamp is housed), optimising lighting levels (levels in OECD countries commonly exceed recommended values), using automatic controls (turn off when no one is present, dim artificial light in response to rising daylight) and retrofitting buildings to make better use of daylight. Buildings designed to optimise daylight can receive up to 70% of their annual illumination needs from daylight, while a typical building will only get 20 to 25%55. In a study by Bertoldi & Atanasiu (2006), national lighting consumption and CFL penetration data is presented for the EU-27 countries (and candidate country Croatia). We used this data as the basis for household penetration rates and lighting electricity consumption in OECD Europe. As well as standby, lighting is an important source of cost-effective savings. The IEA publication "Light's Labour's Lost" (2006) projects that the costeffective savings potential from energy efficient lighting in 2030 is at least 38% of lighting electricity consumption, even disregarding newer and promising solid state lighting technologies such as light emitting diodes (LEDs). In order to determine the savings potential for lighting, it is important to know the percentage of households with energy efficient lamps and the penetration level of these lamps. Based on Bertoldi & Atanasiu (2006) and Waide (2006) we calculated the shares shown in Table 10.7.



Based on the studies already cited we calculate that a maximum of 80% savings can result from the introduction of efficient residential lighting in the Technical scenario and 70% in the [R]evolution Scenario. These savings not only include using energy efficient lamps but behavioural changes and maximising daylight use. Since the penetration of energy efficient lamps differs per household, we have assumed that the savings potential is the maximum saving multiplied by 1 minus the penetration rate. The resulting savings are given in Table 10.8.

3. Set-top boxes Set-top boxes (STBs) are used to decode satellite or cable television programmes and are a major new source of energy demand. More than a billion are projected to be purchased worldwide over the next decade. The energy use of an average set-top box is 2030 W, but it uses nearly the same amount of energy when switched off56. In the USA, STB energy use is estimated at 15 TWh/year, or about 1.3% of residential electricity use57. With more advanced uses, for instance digital video recorders (DVRs), STB energy use is forecast to triple to 45 TWh/year by 2010 ­ an 18% annual growth rate and 4% of 2010 residential electricity use.
Because of their short lifetimes (on average five years) and high ownership growth rates, STBs provide an opportunity for significant short term energy savings. Cable/satellite boxes without DVRs use 100 to 200 kWh of electricity per year, whilst combined with DVRs they use between 200 and 400 kWh per year. Media receiver boxes use less energy (around 35 kWh per year) but must be used in conjunction with existing audiovisual equipment and computers, thus adding another 35 kWh to the annual energy use of existing home electronics. Figure 10.12 shows the annual energy use of common household appliances. This shows that the energy use of some set-top boxes approaches that of the major energy consuming household appliances.

Reducing the energy use of set-top boxes is complicated by their complex operating and communication modes. Although improvements in power supply design and efficiency will be effective in reducing energy use, the major savings will be obtained through energy management measures. The study by Rainer et al (2004) reports a savings potential of between 32% and 54% over five years (2005-2010). Assuming that these drastic measures have not yet been applied and due to lack of data on other regions, we have taken these reduction percentages as the global potential up to 2050.

references 56 OECD/IEA, 2006; HOROWITZ, 2007 57 RAINER ET AL., 2004

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GLOBAL ENERGY [R]EVOLUTION A SUSTAINABLE GLOBAL ENERGY OUTLOOK

4. cold appliances The average household in OECD Europe consumed 700 kWh/year of electricity for food refrigeration in 2000 compared with 1,034 kWh/year in Japan, 1 216 kWh/year in OECD Australasia and 1,294 kWh/year in OECD North America. These figures illustrate differences in average household storage capacities, the ratio of frozen to fresh food use, ambient temperatures and humidity, and food storage temperatures and control58. European households typically either have a refrigerator-freezer in the kitchen (sometimes with an additional freezer or refrigerator), or they have a refrigerator and a separate freezer. Practical height and width limits place constraints on the available internal storage space for an appliance. Similar constraints apply in Japanese households, where ownership of a single refrigerator-freezer is the norm, but are less pressing in OECD North America and Australia. In these countries almost all households have a refrigerator-freezer and many also have a separate freezer and occasionally a separate refrigerator.

Looking in detail at the situation in the European Union, we found that in 2003, 103 TWh of electricity was consumed by household cold appliances alone (15% of total 2004 residential end use). A cold appliance with an energy use rating of A++ uses 120 kWh per year, while a comparable appliance with energy rating B uses 300 kWh per year and with rating C 600 kWh per year59. The average energy rating of appliances sold in the EU-15 countries is still B. If only A++ appliances were sold, energy consumption would be 60% less. The average lifetime of a cold appliance is 15 years, which means that 15 years from the introduction of only A++ labelled appliances, 60% less energy would be used in the EU-15. According to the European Commission (see Table 10.9), consumption in TWh/y could decrease from 103 in 2003 to 80 in 2010 with additional policies to encourage efficient appliances. This means that the energy efficiency of cold appliances could increase by about 3.5% each year.

5. computers and servers The average desktop computer uses about 120 W per hour - the monitor 75 W and the central processing unit 45 W - and the average laptop 30 W per hour. Current best practice monitors60 use only 18 W (15 inch screen), which is 76% less than the average. Savings for computers are especially important in the commercial sector. According to a 2006 US study, computers and monitors have the highest energy consumption in an office after lighting. In Europe, office equipment use is considered to be less important (see Figure 4), but estimates differ widely61. Some studies have shown that automatic and/or manual power management of computers and monitors can significantly reduce their energy consumption.
A power managed computer consumes less than half the energy of a computer without power management62, depending on how your computer is used; power management can reduce the annual energy consumption of a computer and monitor by as much as 80%63. Approximately half of all office computers are left on overnight and at weekends (75% of the time). Apart from switching off at night, using LCD (liquid crystal display) monitors requires less energy than CRT (cathode ray tube). An average LCD screen uses 79% less energy than an average CRT monitor if both are power-managed64. Further savings can be made by ensuring computers enter low power mode when they are idle during the day. Another benefit of decreasing the power consumption of computers and monitors is that it reduces the load for air conditioning. According to a 2002 study by Roth et al, office equipment increases the air conditioning load by 0.2-0.5 kW per kW of office equipment power consumption.
The average computer with a CRT monitor in constant operation uses 1,236 kWh/y (482kWh/y for the computer and 754kWh/y for the monitor). With power management this reduces to 190kWh/y (86+104). Effective power management can save 1,046kWh per computer and CRT monitor per year, a reduction of 84%, or 505kWh per computer and LCD monitor per year. These examples illustrate that power management can have a greater effect than just more efficient equipment. The German website EcoTopten, for example, says that more efficient computers save 50-70% compared with older models and efficient flat-screens use 70% less energy than CRTs.
Servers are multiprocessor systems running commercial workloads65. The typical breakdown of peak power server use is shown in Table 10.10.

Data centres are facilities that primarily contain electronic equipment used for data processing, data storage and communications networking66. 80% of servers are located in these data centres67. Worldwide, about three million data centres and 32 million servers are in operation. Approximately 25% of servers are located in the EU, but only 10% of data centres, meaning that on average each data centre hosts a relatively large number of servers (Fichter, 2007). The installed base of servers is growing rapidly due to an increasing demand for data processing and storage. New digital services such as music downloads, video-on-demand, online banking, electronic trading, satellite navigation and internet telephony spur this rapid growth, as well as the increasing penetration of computers and the internet in developing countries. Since systems have become more and more complex to handle increasingly large amounts of data, power and energy consumption (about 50% used for cooling68) have grown in parallel. The power density of data centres is rising by approximately 15% each year69. Aggregate electricity use for servers doubled over the period 2000 to 2005 both in the US and worldwide (see Figure 10.13). Data

Power and energy consumption are key concerns for internet data centres and there is a significant potential for energy efficiency improvements. Existing technologies and design strategies have been shown to reduce the energy use of a typical server by 25% or more70. Energy management efforts in existing data centres could reduce their energy usage by around 20%, according to the US Environmental Protection Agency (EPA).

The US EPA scenario for reducing server energy use includes

measures such as enabling power management, consolidating

servers and storage, using liquid instead of air cooling, improving

the efficiency of chillers, pumps, fans and transformers and using

combined heat and power. This bundle of measures could reduce

electricity use by up to 56% compared to current efficiency trends

(or 60% compared to historical trends), the EPA concludes,

representing the maximum technical potential by 2011. This

assumes that only 50% of current data centres can introduce these

measures. A significant savings potential is therefore available for

servers and data centres around the world by 2050. For computers

10

and servers we have based the savings potential on the WBCSD 2005 report and other sources mentioned in this section. For the

Technical scenario this would result in 70% savings, for the

[R]evolution Scenario 55% savings.


6. air conditioning Today in the USA, some 14 % of total electrical consumption is used to air condition buildings71. Increasing use of small air conditioning units (less than 12 kW output cooling power) in southern European cities, mainly during the summer months, is also driving up electricity consumption. Total residential electricity consumption for air conditioners in the EU-25 in 2005 was estimated to be between 7 and 10 TWh per year72. However, we should not underestimate the consumption in developing countries. Many of these are located in warm climatic zones. With the rapid development of its economy and improving living standards, central air conditioning units are now widely used in China, for example. They currently account for about 20% of total Chinese electricity consumption73.
There are several options for technological savings in air conditioning equipment. One is to use a different refrigerant. Tests with the refrigerant Ikon B show possible energy consumption reductions of 2025% compared to the commonly used liquids74. However, behavioural changes should not be overlooked. One example of a smart alternative to cooling a whole house was developed by the company Evening Breeze. This combined a mosquito net, bed and air conditioning so that only the bed had to be cooled instead of the whole bedroom.
There are also other options for cooling, such as geothermal cooling by heat pumps. This uses the same principle as geothermal heating, namely that the temperature at a certain depth below the Earth's surface remains constant year round. In the winter we can use this relatively high temperature to warm our houses. Conversely, we can use the relatively cold temperature in the summer to cool our houses. There are several technical concepts available, but all rely on transferring the heat from the air in the building to the Earth. A refrigerant is used as the heat transfer medium. This concept is cost-effective75. Heat pumps have been gaining market share in a number of countries76.
Solar energy can also be used for cooling through the use of solar thermal energy or solar electricity to power a cooling appliance. Basic types of solar cooling technologies include absorption cooling (uses solar thermal energy to vapourise the refrigerant); desiccant cooling (uses solar thermal energy to regenerate (dry) the desiccant); vapour compression cooling (uses solar thermal energy to operate a Rankinecycle heat engine); evaporative cooling; and heat pumps and air conditioners that can be powered by solar photovoltaic systems. To drive the pumps only 0.05 kWh of electricity is needed, instead of 0.35 kWh for regular air conditioning77, representing a savings potential of 85%.
Not only is it important to use efficient air conditioning equipment, it is equally important to reduce the need for air conditioning in the first place. Important ways to reduce cooling demand are to use insulation to prevent heat from entering the building, to reduce the amount of inefficient appliances present in the house, such as incandescent lamps or old refrigerators that give off unusable heat, to use cool exterior finishes, such as `cool roof' technology or lightcoloured wall paint, to improve windows and use vegetation to reduce the amount of heat that comes into the house, and to use ventilation instead of air conditioning units.
For air conditioning we have assumed that the savings potential based on the 2005 WBCSD study and other sources mentioned in this section will amount to 70% savings under the Technical scenario and 55% savings under the [R]evolution Scenario.


total household savings
Total savings from the previous sections are summarised here. Table 10.11 shows the total savings in percentages up to 2050. These need to be translated into energy efficiency improvements per year to compare them with the Reference Scenario. Since it is not clear what assumptions this is based on, we have assumed an efficiency improvement of 1% per year. Subtracting this from the reduction potentials in Table 10.12 shows the energy efficiency improvements per year measured against the Reference Scenario. Electricity use in the `Other' sector is assumed to decline at the same rate as residential electricity use (lighting, appliances, cold appliances, computers/servers and air conditioning). We have assumed a minimum energy efficiency improvement of 1.2% in the Technical scenario and 1.1% in the [R]evolution Scenario, including autonomous improvements.
the standard household
In order to enable a specific level of energy demand as a basic "right" for all people in the world, we have developed the model of an efficient Standard Household. A fully equipped OECD household (including fridge, oven, TV, radio, music centre, computer, lights etc.) currently consumes between 1,500 and 3,400 kWh/a per person. With an average of two to four people per household the total consumption is therefore between 3,000 and 12,000 kWh/a. This demand could be reduced to about 550 kWh/a per person just by using the most efficient appliances available on the market today. This does not even include any significant lifestyle changes. Based on this assumption, the `over-consumption' of all households in OECD countries totals more than 2,100 billion kilowatt-hours. Comparing this figure with the current per capita consumption in developing countries, they would have the right to use about 1,350
10 billion kilowatt-hours more. The `oversupply' of OECD households
could therefore fill the gap in energy supply to developing countries one and a half times over.
By implementing a strict technical standard for all electrical appliances, in order to achieve a level of 550 kWh/a per capita consumption, it would be possible to switch off more than 340 coal power plants in OECD countries.

Fully Equipped "Best Practice Household" demand - per capita: 550 kWh/a
Latin America Africa China India
Developing Asia Global per capita average
Transition Economies Middle East
OECD Pacific OECD Europe North America

Improving efficiency in household means Equity:
Undersupply of households in Developing countries in 2005 compared to "Best Practice Household": 1,373 TWh/a
Over consumption in OECD countries in 2005 compared to "Best Practice Household": 2,169 TWh/a
image DISHWASHER AND OTHER KITCHEN APPLIANCES.

energy efficiency standards - the potential is huge
Setting energy efficiency standards for electrical equipment could have a huge impact on the world's power sector. A large number of power plants could be switched off if strict technical standards were brought into force. The table below provides an overview of the theoretical potential for using efficiency standards based on

currently available technology. The Energy [R]evolution Scenario has not been calculated on the basis of this theoretical potential. However, this overview illustrates how many power plants producing electricity would not be needed if all global appliances were brought up to the highest efficiency standards overnight.

table 10.13: effect on number of global operating power plants introducing strict energy efficiency standards*
BASED ON CURRENTLY AVAILABLE TECHNOLOGY

Transport is a key element in reducing the level of greenhouse gases produced by energy consumption. 28% of current energy use comes from the transport sector ­ road, rail and sea. In order to assess the present status of global transport, including its carbon footprint, a special study was undertaken by Ecofys.
This chapter gives an overview of how the Ecofys Reference Scenario was originated and the changes expected under the Energy [R]evolution Scenario. The following chapter looks specifically at the technical efficiency potential for cars. The main actions proposed in the Energy [R]evolution Scenario are: increasing the use of public transport, especially trains, reducing the number of kilometres driven each year by private cars, and introducing more efficient vehicles.

· Medium duty trucks include medium haul trucks and delivery vehicles.
· Buses have been divided into two size classes - full size buses and minibuses - with the latter roughly encompassing the range of small buses and large passenger vans prevalent around the developing world and typically used for informal transit services.
· All air travel in each region (domestic and international) is treated together.
The Figures below show the breakdown of final energy demand for transport by mode in 2005 and 2050.

the reference scenario for transport
In order to calculate possible savings in the transport sector, we first need to construct a detailed Reference Scenario. This needs to include detailed shares and energy intensity data per mode of transport and per region up to 2050. Although this data cannot be found in the IEA WEO, input is available from the WBCSD (World Business Council for Sustainable Development) mobility database. This database was completed in 2004 after collaboration between the IEA and the WBCSD's Sustainable Mobility Project to develop a global transport model. Those transport options have been selected which can be expected to result in a substantial reduction in energy demand up to 2050.
In order to estimate the energy demand per transport sub-sector, we need the modal shares per region up to 2050. These can be calculated by using the WBCSD final energy use per mode, adding them together and working out the share per mode in % by region from 2005-2050. In the OECD, for example, light duty vehicles (LDVs) account for 57% of total energy use, heavy trucks for 15%.
Since international shipping spreads across all regions of the world, it has been left out whilst calculating the baseline figures. The total is therefore made up of LDVs, heavy and medium duty freight, two to three wheel vehicles, buses, minibuses, rail, air and national marine transport. Although energy use from international marine bunkers (international shipping fuel suppliers) is not included in these calculations, it is still estimated to account for 9% of worldwide transport final energy demand in 2005 and 7% by 2050. A recent UN report concluded that carbon dioxide emissions from shipping are much greater than initially thought and increasing at an alarming rate. It is therefore very important to improve the energy efficiency of international shipping. Possible options are examined later in this chapter.
The definitions of different transport modes for this scenario78 are:
· Light-duty vehicles (LDVs) are defined as four-wheel vehicles used primarily for personal passenger road travel. These are typically cars, SUVs (Sports Utility Vehicles), small passenger vans (up to eight seats) and personal pickup trucks. Within this report we will sometimes call light-duty vehicles simply `cars'.
· Heavy duty trucks are defined here as long haul trucks operating almost exclusively on diesel fuel. These trucks carry large loads with lower energy intensity (energy use per tonne-kilometre of haulage) than medium duty trucks such as delivery trucks.

As can be seen from the above figures, the largest share of energy demand comes from cars, although it slightly decreases from 48% in 2005 to 44% in 2050. The share of air transport increases from 13% to 19%. Of particular note is the high share of road transport in total transport energy demand: 82% in 2005 and 74% in 2050. The Figures below show world final energy use for the transport sector by region in 2005 and 2050.


As we can see, OECD Europe has the highest final energy use, followed by OECD North America and OECD Pacific. Over time, the shares of these regions will decrease while the shares of all other regions will increase. In 2050, OECD Europe will still be the largest final energy user, but now followed by China. Figure 11.3 and Figure 11.4 show the forecast worldwide growth of different passenger and freight transport modes. Light duty vehicles will remain the most important mode of passenger transport, air,

passenger rail and two wheeled transport are expected to grow considerably, while three wheeled transport is expected to grow only slightly. Buses and minibus passenger transport is expected to decline a little. Heavy duty trucks will remain the most important mode of freight transport. Freight rail, inland navigation and medium duty trucks will also increase, but will remain `inferior' modes in the Reference Scenario.


the future of the transport sector in the energy [r]evolution scenario
The Reference Scenario shows that changes in patterns of passenger travel are partly a consequence of growing wealth. As GDP per capita increases, people tend to migrate towards faster, more flexible and more expensive travel modes (from buses and trains to cars and air). With faster modes, people also tend to travel further and do not reduce the amount of time spent travelling79. There is also a strong correlation between GDP growth and increases in freight transport. More economic activity will mean more transport of raw materials, intermediary products and final consumer goods.
All the above figures and tables illustrate the importance of both a modal shift and a slowing of growth in forecast transport if emissions reductions are to be achieved. Furthermore, it is very important to make the remaining transport as clean as possible, signalling the role of energy efficiency improvements. Unlimited growth in the transport sector is simply not an option. A shift towards a sustainable energy system, which respects natural limits and saves the world's climate, requires a mix of lifestyle changes and new technologies. We basically need to use our cars less, fly
11 less and use more public transport, as well as cutting down the
transport kilometres for freight transport whilst introducing more new and highly efficient vehicles.
technical potentials We have looked at three options for decreasing energy demand in the transport sector:
· Reduction of transport demand.
· Modal shift from high energy intensive transport modes to low energy intensity.
· Energy efficiency improvements.
step 1: reduction of transport demand A reduction in transport demand involves reducing passenger-km per capita and reducing freight transport demand. The amount of freight transport is to a large extent linked to GDP development and therefore difficult to influence. However, by improved logistics, for example optimal load profiles for trucks, the demand can be limited.
passenger transport First we must look at reducing passenger transport demand. For this we need to examine the transport demand per capita in the Reference Scenario, as shown in Table 11.3. This shows that transport demand is highest in OECD North America, followed by the OECD Pacific. Demand per capita is lowest in Africa and India.
The potential for reducing passenger transport demand is very difficult to determine. For OECD countries we have assumed that transport demand per capita can be reduced by 10% by 2050 in comparison to the Reference Scenario. For the non-OECD countries we have assumed in the [R]evolution Scenario ­ as a matter of equity - no reduction in transport demand per capita because the current demand is already quite low in comparison to the OECD. We have made an exception for the Transition Economies, where we assume that transport demand per capita can be reduced by 5% in 2050.
The table below shows the profile of passenger transport demand per capita in 2005, development under the Reference Scenario by 2050 and the reduced transport demand under the [R]evolution Scenario, broken down by region.


freight transport In the Reference Scenario the largest absolute increase in freight transport demand is expected in the Transition Economies, whilst the largest percentage increase is forecast in China (383%). The potential for reducing demand for freight transport by improved logistics is difficult to estimate. For the [R]evolution Scenario we have assumed that freight transport demand can be reduced by 5% in comparison to the Reference Scenario, although only through measures in the OECD and Transition Economies.

step 2: changes in transport mode In order to decide which vehicles or transport systems are the most effective for each purpose, an analysis of the different technologies is needed. To calculate the energy savings achieved by shifting transport mode we need to know the energy use and intensity for each type of transport80. The following information is needed:
· Passenger transport: Energy demand per passenger kilometre, measured in MJ/p-km.
· Freight transport: Energy demand per kilometre of transported tonne of goods, measured in MJ/ tonne-km.
development of passenger transport Passenger transport includes cars, minibuses, two and three wheelers, buses, passenger rail and air transport. Freight transport includes medium trucks, heavy trucks, national marine and freight rail. The figures below show a breakdown of passenger transport by mode in the Reference Scenario for 2005 and 2050 (as % of total passenger-km). The global demand for air transport is expected to grow from 12% in 2005 to 23% in 2050.


travelling by rail is the most efficient Figure 11.8 shows the worldwide average specific energy consumption by transport mode under the Reference Scenario in 2005 and 2050. This data differs for each region. As can be seen, the difference in specific energy consumption for each transport mode is large. Passenger transport by rail will consume 85% less energy in 2050 than car transport and by bus nearly 70% less energy. This means that there is a large energy savings potential to be realised by a modal shift.
modal shift for passengers in the energy [r]evolution scenario From the figures above we can conclude that in order to reduce transport energy demand by modal shift, passengers have to move from cars and air transport to the lower intensity passenger rail and bus transport. As an indication of the action required we can take Japan as a `best practice country'. In 2004, Japan had a large share of p-km by rail (29%) thanks to the fact that it had established a strong urban and regional rail system81. Comparing different regions with the example of Japan, and assuming that 40 years is enough time to build up an extensive rail network, the following modal shifts have been assumed:
table 11.4: passenger modal shifts assumed in [r]evolution scenario


freight transport Figures 11.9 and 11.10 show the breakdown of freight transport in percentages of total tonnes-km per year and by region under the Reference Scenario. Both the Transition Economies and China have a very large proportion of rail transport while the Developing Asia and the Middle East have a very small share. The share of heavy and medium trucks is very large in the Developing Asia countries and OECD Europe. National marine transport plays an important role in the OECD Pacific. The figures also show that the difference between 2005 and 2050 is relatively small.

transporting goods by rail is the most efficient Figure 11.12 shows the energy intensity for world average freight transport in 2005 and 2050 under the Reference Scenario. Energy intensity for all modes of transport is expected to decrease by 2050.

modal shift for transporting goods in the energy [r]evolution scenario From the figures above we can conclude that in order to reduce transport energy demand by modal shift, freight has to move from medium and heavy duty trucks to the less energy intensive freight rail and national marine. Canada is a `best practice' country in this respect, with 29% of freight transported by trucks, 39% by rail and 32% by ships. Since the use of ships largely depends on the geography of the country, we do not propose a modal shift for national ships but instead a shift towards freight rail. China, OECD Pacific and the Transition Economies already have a low share of truck usage, so for these regions we will not assume a modal shift. For the other regions we have assumed the following changes:

marine transport Since the WBCSD did not provide estimates for total national marine tonnes-km per year or energy intensities per region, we have calculated these ourselves. Data for energy intensity for the year 2005 in OECD countries was found in OECD/IEA, 2007. For other regions we have assumed that the highest OECD estimate would hold. The 2050 intensities were extrapolated from 2005 data using 1% per year autonomous efficiency improvement. The amount of t-km per year could then be calculated using the Reference Scenario energy use divided by the energy intensity in MJ/t-km.
case 11.1: wind powered ships
Introduced to commercial operation in 2007, the SkySails system allows wind power, which has no fuel costs, to contribute to the motive power of large freight-carrying ships, which currently use increasingly expensive and environmentally damaging oil. Instead of a traditional sail fitted to a mast, the system uses large towing kites to contribute to the ship's propulsion. Shaped like paragliders, they are tethered to the vessel by ropes and can be controlled automatically, responding to wind conditions
11 and the ship's trajectory.
The kites can operate at altitudes of between 100 and 300 metres, where stronger and more stable winds prevail. By means of dynamic flight patterns, the SkySails are able to generate five times more power per square metre of sail area than conventional sails. Depending on the prevailing winds, the company claims that a ship's average annual fuel costs can be reduced by 10 to 35%. Under optimal wind conditions, fuel consumption can temporarily be cut by up to 50%.
On the first voyage of the Beluga SkySails, a 133m long specially built cargo ship, the towing kite propulsion system was able to temporarily substitute for approximately 20 % of the vessel's main engine power, even in moderate winds. The company is now planning a kite twice the size of this 160m2 pilot.
The designers say that virtually all sea-going cargo vessels can be retro- or outfitted with the SkySails propulsion system without extensive modifications. If 1,600 ships would be equiped with these sails by 2015 ,it would save over 146 million tonnes of CO2 a year, equivalent to about 15% of Germany's total emissions.

step 3: efficiency improvements or travelling with less energy Energy efficiency improvements are the third important way of reducing transport energy demand. This section explains the different possibilities for improving energy efficiency82 up to 2050 for each type of transport: · Air transport · Passenger and freight trains · Buses and mini-buses · Trucks · Ships for marine transport · Motorcycles · Cars air transport Savings for air transport have been taken from Akerman, 2005. He reports that a 65% reduction in fuel use is technically feasible by 2050. This has been applied to 2005 energy intensity data in order to calculate the technical potential. The figure below shows the energy intensity per region in the Reference Scenario and in the two low energy demand scenarios.
passenger and freight trains Savings for passenger and freight rail transport have been taken from Fulton & Eads (2004). They report a historic improvement in the fuel economy of passenger rail of 1% per year and for freight rail of between 2 and 3% per year. Since no other studies are available we have assumed for the Technical scenario a 1% improvement of in energy efficiency per year for passenger rail and 2.5% for freight rail. The figure below shows the energy intensity per region in the Reference Scenario and in the two low energy demand scenarios.

freight rail Savings for freight rail are taken from the same study as for passenger rail. They report a historic improvement in the fuel economy of freight rail of between 2 and 3% per year. Since no other studies are available we have assumed for the Technical scenario a 2.5% improvement in energy efficiency per year. The figure below shows the energy intensity per region in the Reference Scenario and in the two low energy demand scenarios.


Energy intensities for passenger rail transport are assumed to be the same for all regions due to a lack of sufficiently detailed data. The differentiation in energy intensity for freight rail is based on the following assumption: regions with longer average distances for freight rail (such as the US and Former Soviet Union), and where more raw materials are transported (such as coal), show a lower energy intensity than other regions (Fulton & Eads, 2004). Future projections use ten year historic IEA data. Rail intensities are and will remain highest in OECD Europe and OECD Pacific and lowest in India.
169

GLOBAL ENERGY [R]EVOLUTION A SUSTAINABLE GLOBAL ENERGY OUTLOOK

buses and minibuses The company Enova Systems is promoting a `clean bus' with a 100% improvement in fuel economy. We have adopted this improvement and applied it to 2005 energy intensity numbers per region. For minibuses the American Council for an Energy Efficient Economy reports83 a fuel economy improvement of 55% by 2015. Since this is a very ambitious target and will most likely not be reached, we have extended it up to 2050 and adopted it as the technical potential (see Figure 11.16 and Figure 11.17). Currently, buses in North America consume far and away the most energy. The Reference Scenario predicts an increase in all regions between 2005 and 2050. Although in general more efficient buses are being produced, this is offset by increases in average bus size, weight and power. OECD buses have much more powerful engines than nonOECD buses, but the latter are likely to catch up over this period.
figure 11.16: energy intensities for buses in the reference and [r]evolution scenarios

trucks (freight by road) Elliott et al., 2006 give possible savings for heavy and medium-duty freight trucks. This list of reduction options is expanded in Lensink and De Wilde, 2007. For medium duty trucks a fuel economy saving of 50% is reported by 2030 (mainly due to hybridisation). We applied this percentage to 2005 energy intensity data, calculated the fuel economy improvement per year and extrapolated this yearly growth rate up to 2050. For heavy duty trucks we applied the same methodology, arriving at a 39% savings. Current intensities are highest in the Middle East, India and Africa and lowest in OECD North America. The Reference Scenario predicts that future values will converge, assuming past improvement percentages and assuming a higher learning rate in developing regions. The figures below show the energy intensity per region in the Reference Scenario and in the two low energy demand scenarios.
figure 11.18: reference scenario and 2050 technical potential energy intensities for different regions for medium duty freight transport

Buses energy intensity MJ/p-km OECD Europe OECD North America OECD Pacific Transition Economies
China India Developing Asia Latin America Africa Middle East World Average (stock-weighted)
Medium freight energy intensity MJ/t-km OECD Europe OECD North America OECD Pacific Transition Economies
China India Developing Asia Latin America Africa Middle East World Average (stock-weighted)

transport | [R]EVOLUTION SCENARIO

Minibuses energy intensity MJ/p-km OECD Europe OECD North America OECD Pacific Transition Economies
China India Developing Asia Latin America Africa Middle East World Average (stock-weighted)
Heavy freight energy intensity MJ/t-km OECD Europe OECD North America OECD Pacific Transition Economies
China India Developing Asia Latin America Africa Middle East World Average (stock-weighted)


marine transport National marine savings have also been taken from the Lensink and De Wilde study. They report 20% savings in 2030 for inland navigation as a realistic potential with currently available technology, and ultimate efficiency savings of up to 30% for the current fleet. To arrive at the potential in 2050, we used the same approach as described for road freight above. OECD Pacific has the lowest current energy intensity due to the fact that they have a large proportion of long haul trips where larger (less energy intensive) boats can be used. All energy intensities are expected to improve by 1% per year up to 2050. Reference Scenario energy intensities and the technical potentials for national marine transport are shown in Figure 11.20.

motorcycles For two wheelers we have based the potential on IEA/SMP (2004), where 0.3 MJ/p.km is the lowest value. For three wheelers we have assumed that the technical potential is 0.5 MJ/p.km in 2050. The uncertainty in these potentials is high, although two and three wheelers only account for 1.5% of transport energy demand.
The figures below show the energy intensity per region in the Reference Scenario and in the two low energy demand scenarios.


National marine energy intensity MJ/t-km OECD Europe OECD North America OECD Pacific Transition Economies
China India Developing Asia Latin America Africa Middle East World Average (stock-weighted)
2-wheel energy intensity MJ/p-km OECD Europe OECD North America OECD Pacific Transition Economies
China India Developing Asia Latin America Africa Middle East World Average (stock-weighted)
passenger cars This section is based on a special study conducted by the DLR's Institute for Vehicle Concepts to investigate the potential for improving the efficiency of existing cars and moving towards greater use of hybrid or electric vehicles. See Chapter 12 for a full account of this analysis.
Many technologies can be used to improve the fuel efficiency of passenger cars. Examples include improvements in engines, weight reduction and friction and drag reduction84. The impact of the various measures on fuel efficiency can be substantial. Hybrid vehicles, combining a conventional combustion engine with an electric engine, have relatively low fuel consumption. The most well-known is the Toyota Prius, which originally had a fuel efficiency of about five litres of gasoline-equivalent per 100 km (litre ge/100 km). Recently, Toyota presented an improved version with a lower fuel consumption of 4.3 litres ge/100 km. Further developments are underway, as shown by the presentation of new concept cars by the main US car manufacturers in 2000 with a specific fuel use as low as three litres ge/100 km. There are suggestions that applying new lightweight materials, in combination with the new propulsion technologies, can bring fuel consumption levels down to 1 litre ge/100 km.
Based on SRU (2005), the technical potential in 2050 for a diesel fuelled car is 1.6 and for a petrol car 2.0 litres ge/100 km. Based on the sources in Table 11.6, we have assumed 2.0 litres as the technical potential for Europe and adopted the same improvement in efficiency (about 3% per year) for other regions. In order to reach this target in time, these more efficient cars need to be on the market by 2030 ­ assuming that the maximum lifetime of a car is 20 years.
The energy intensities for car passenger transport are currently highest in OECD North America and Africa and lowest in OECD Europe. The Reference Scenario shows a decrease in energy intensities in all regions, but the division between highest and lowest will remain the same, although there will be some convergence. We have assumed that the occupancy rate for cars remains the same as in 2005, as shown in the figure below.

Since the global use of privately owned cars (light duty vehicles) currently accounts for more carbon dioxide emissions than any other form of transport, the DLR's Institute for Vehicle Concepts was commissioned to look specifically at the potential for reductions in this sector. At the same time, the door has already been opened for both major technological changes and shifts in personal habits. Rising oil prices, increasing concern about climate change and, in some regions, legislation on everything from bio fuels to vehicle emissions, have together combined to put pressure on international vehicle manufacturers to investigate solutions. Numerous technical fixes are already in production which can improve the efficiency of the predominant internal combustion engine, as well as moving towards alternatives no longer based on fossil fuels.
This specific study of the light duty vehicle market concludes that a number of measures could help reduce the CO2 emissions from cars very significantly to a target level of about 80 g CO2 per km for the European Union. These measures include a major shift to vehicles powered by (renewable) electricity, a range of efficiency improvements to the power trains of existing internal combustion engines and behavioural changes leading to an overall reduction in kilometres travelled.
methodology
The DLR developed a global scenario for cars based on a detailed bottom-up model covering ten world regions. The aim was to produce a challenging but feasible scenario which would lower global CO2 emissions within the context of the overall emission reduction objective. Cars contribute about 45% of the greenhouse gas emissions from the entire transport sector, the largest proportion of any mode.
This approach takes into account a vast range of technical measures to reduce the energy consumption of vehicles, but also considers the dramatic increase in vehicle ownership and annual mileage taking place in developing countries. The turnover of replacement vehicles has been modelled over five year stages from 2005 to 2050. The scenario assumes that a large share of renewable electricity is available in the future. The major parameters for achieving increased efficiency are:
· vehicle technology
· alternative fuels
· changes in sales by vehicle size
· changes in vehicle kilometres travelled
This section will examine the development of the world's car fleet in more detail and is focused on non-technical as well as technical solutions. Light duty vehicles and their technologies are divided into three vehicle segments (small, medium and large) and nine categories of fuel/propulsion technology:

· conventional petrol
· petrol hybrid
· conventional diesel
· diesel hybrid
· LPG/CNG (Liquefied Petroleum Gas/Compressed Natural Gas)
· LPG/CNG hybrid
· fuel cell hydrogen
· battery electric
· plug in-hybrid electric vehicles
As a Reference Scenario for the starting point in 2005, the analysis in the IEA/SMP model85 has been used.This is the most comprehensive and detailed model available for CO2 emissions from the global transport sector. For those technologies not included in the SMP model, we had to decide starting points for today's performance values (see below). We then created so-called `target reference vehicles' (TRVs), which project the energy consumption feasible for each of the main fuel conversion technologies.This is described in the section `Future vehicle technologies'. The TRVs will be introduced in the different regions of the world over a varying timescale. In general, the technologies to achieve the TRVs are aimed to be available for sale in 2050 - 42 years from now.
In general, we have first introduced the most recent - and most
expensive - technologies in the currently industrialised countries, and 12
postponed their introduction in the rest of the world. We have then used the option to change the energy source used to fuel light duty transport. This is described in the section `Projection of future technology mix'. Various non-technical measures are reflected in the projections for future vehicle sales (see `Projection of vehicle segment split'), in the projection for the absolute number of vehicles sold in the future (see `Projection of global vehicle stock development') and in the projection of how much individual vehicles are used compared to other transport means in the future (see `Projection of kilometres driven').
reference scenario
The IEA Reference Scenario developed for the Mobility 2030 project86 was used as the starting point for the year 2005 key data and for comparison as a `business as usual' scenario. It is important to note that for this scenario no major new policies were assumed to be implemented beyond those already introduced by 2003. While for some areas, such as pollution control, further so called policy trajectories have been assumed, this was not the case for fuel consumption. Trends in future fuel consumption are therefore based on historical (non-policy driven) trends87. If the serious discussions taking place in Europe and the United States on the regulation of fuel economy in new vehicles, together with legal guidelines and proposed long term targets, were taken into account, the business as usual case would be different. However, it is beyond the scope of this project to redefine the status quo. Nevertheless, we include the most recent political targets in our scenario.
references 85 FULTON, L. (2004): THE IEA/SMP TRANSPORTATION MODEL; FULTON, L. AND G. EADS (2004): IEA/SMP MODEL DOCUMENTATION AND REFERENCE CASE PROJECTION. 86 WBCSD (2004): MOBILITY 2030: MEETING THE CHALLENGES TO SUSTAINABILITY, WORLD BUSINESS COUNCIL FOR SUSTAINABLE DEVELOPMENT. 87 FULTON, L. AND G. EADS (2004): IEA/SMP MODEL DOCUMENTATION AND REFERENCE CASE PROJECTION

energy [r]evolution car scenario
The alternative car scenario is targeted towards high CO2 reductions compared to today's levels. Summarised in brief, we have focused on the following proposals:
· Efficiency improvements resulting from technological development
· Renewable electricity as the primary alternative fuel
· Influencing customer behaviour in the long term
There is a huge potential for technological options to make today's vehicles more efficient while lowering their CO2 emissions. A car today converts the energy in the fuel into mechanical energy in order to take the compartment we sit in from point A to B, but it does it in a very inefficient way. Only 25% to 35% of the chemical energy in the fuel is converted into mechanical energy by the engine. The rest is lost as waste heat. Only 10% of the fuel energy is used to overcome driving resistance. Hybrid technologies mark an important starting point for making vehicles more efficient, whilst technologies to lower energy demand, such as lightweight design, reduced rolling resistance wheels and improved aerodynamics, will contribute to the achievement of very low fuel consumptions.
Renewable electricity can be produced almost everywhere in the world, and with declining costs in the future. Taking into account the enormous development in batteries in recent years, we believe that electric mobility as offered by battery electric cars and plug-in hybrid electric vehicles is the preferred way to make major reductions in the CO2 emissions of cars.
Consumer behaviour is the third major key to a lower carbon world for the transport sector. Here we have relied on programmes, incentives and policy measures to support a shift towards low carbon emitting vehicles as well as reducing demand in general.

future vehicle technologies
The global vehicle market, with about 55 million vehicles sold per year, is enormous. Around 500 automobile plants produce this huge quantity. Regional markets differ in the size of vehicles and fuel type used. Depending on income, infrastructure and the spatial characteristics of the countries, people have different preferences for the size of vehicles they use.
The propulsion technology used in all new cars globally does not differ very much, however. For the sake of simplicity, therefore, we have defined the reference target vehicles, which we use throughout the world, as characterised by their energy consumption `tank-towheel', independent of the fuel used. The energy consumption for the reference target vehicles are presented in Figure 12.3.
Differences in energy consumption `tank-to-wheel' shown in Figure 12.3 reflect the different efficiencies with which vehicles convert fuel energy into movement. The various fuels and energy sources have different qualities, depending on their upstream production processes. This is taken into account in the model. In the light of high energy prices and thus growing costs for individual mobility, we foresee a market for dedicated small commuter vehicles. These cars would serve predominantly for the transport of a single person, reflecting today's car usage in industrialised countries. Although there will still be seats for three to five people, the comfort for the car passengers will be less. Therefore the `small' passenger vehicle of the future is projected to be smaller than it is today and therefore less energy intensive88.
Due to the differences in income level between the world's regions, which we have assumed to be still valid in 2050, the reference target vehicles are applied to new vehicle sales in the year 2050 for today's most industrialised regions: OECD Europe, North America and OECD Pacific. For all other regions, they are envisaged to enter the market in 2060, ten years later, and 20 years later in Africa.

gasoline and diesel cars

For traditional internal combustion engines, we have only allowed here for improvements in starting and stopping and no other hybrid features. Other vehicle adaptations to be introduced up to 2050 are described in more detail below.

For the small car sector we project a 1.8 litre/100 km (NEDC) fourseater diesel vehicle, as described in simulations by Friedrich89. We found corresponding results from our own simulations for a low-energy concept car with space for three adults and two children. For gasoline, we project 2.4 l/100 km. For the medium size sector, we project the potential for a 50% reduction in CO2 for gasoline cars and 42% for diesel cars. Approximately half of these reductions will be derived from power train improvements (including starting and stopping) and half from an improvement in energy demand. Aerodynamics, rolling resistance and lightweight design will contribute as described below.

For the large size sector, a slightly higher 60% emissions reduction

is predicted, resulting from higher mass reduction and greater

downsizing potentials (due to current over-motorisation). In

addition, we have assumed political measures have been introduced,

such as luxury taxes, in addition to high fuel costs, to reduce the

sales of very large SUVs (Sport Utility Vehicles) for passenger

transport. This means that the size of vehicles within the segment

will also decrease over the years. Examples of future cross-over

SUVs are projected, for example by Lovins and Cramer90.

12

Although considerable improvements are in sight for conventional gasoline and diesel engines without hybridisation, they will be technically hard to reach. Significant CO2 reductions in the short to medium term will therefore be much easier and cheaper to achieve with the hybridisation of power trains.

N

hybrid vehicles
Hybrid drive trains consist of at least two different energy converters and two energy storage units. The most common is the hybrid-electric drive train, although there are also proposals for kinetic and hydraulic hybrids. Advantages of the combination of the internal combustion engine with a second source of power arise from avoiding inefficient working regimes of the internal combustion engine (ICE), recuperation of braking energy, engine displacement downsizing and automated gear switch. For hybrid-electric vehicles, there are several different architectures and levels of hybridisation proposed.
Hybrid vehicles have been available since the 1990s. In 2006, approximately 400,000 hybrid cars were sold, which is less than 1% of world car production. An increasing number of hybrid models are being announced, however. For this study we have used reference values of 491, 4.592, 8.393 lge/100 km respectively for small, medium and large gasoline vehicles94.
For the reference target vehicles in 2050, we have projected the following values, depending on the vehicle segment.
small segment: As explained above, the small segment vehicles will be of the `1 litre car' type - smaller and lighter than today. A dedicated vehicle in the 500 kg class, with three seats and with a highly efficient propulsion system, will be standard by 2050, especially for commuting or other journeys were no multi-purpose
12 family type vehicle is necessary. The fuel consumption for this type of
vehicle is projected to be 1.6 lge/100 km.
medium segment: We developed our vision of reaching 60 g CO2 per km for the medium segment following the technological building blocks described below, although this might not be the only way to reach the target.
· A 25% emissions reduction is envisaged by using turbo charging with variable turbine geometry, external cooled exhaust gas recirculation, gasoline direct injection (2nd generation) and variable valve control/cam phase shifting with respective scavenging strategies. These measures all result in a downsizing and down speeding of the engine95.
· An additional potential for a 25% saving, related to the previous step, will come from hybridisation and the benefits in terms of start/stop improvements, regenerative braking and further downsizing. Waste heat recovery by thermoelectric generators will contribute to the onboard power supply, which saves an additional 3 to 5%96 97.
· A reduction in the vehicle's mass from 360 kg to 1,000 kg will reduce energy demand by about 18%98.To achieve lightweight construction, methods such as topology optimisation, multi-material design and highly integrated components will be used. Mass reductions of 60 to 120 kg for midsized cars have already been achieved99.The production and recycling processes of lightweight materials such as magnesium and carbon fibres will also be improved in 30-40 years time, thus avoiding a shift in emissions from the utilisation to the production phase.
· Aerodynamic resistance, aerodynamic drag and frontal areas offer further potential for improvements. By optimising the car's underside, engine air flows and contours we project an additional lowering of energy demand by 8%.
178

· Rolling resistance depends on the material used for the tyre, the construction of the tyre and its radius, tyre pressures and driving speed. The tyre industry has proposed new concepts for wheels which are intended to lower rolling resistance by 50% by 2030100 . 101 Reducing the rolling coefficient by 1/1000 will lead to fuel savings of 0.08 l/100 km102.This results in an additional 12% CO2 savings.
· Further potentials for energy savings will come from `intelligent controllers' which improve energy management and drive train control strategies by recognising frequently driven journeys. Improved traffic management to help a driver find the energy optimised route might also make a contribution. Other options for hybridisation could come from free piston linear generators, which produce electricity with a constant high efficiency, at the same time avoiding part load conditions because of the variable cylinder capacity103.
From the technologies and potentials described here, we project that within the next 40 years an improvement of 64% in energy consumption for hybrid vehicles is achievable, resulting in 2.6 l/100 km or 60 g CO2/km for a middle sized car in the NEDC test cycle. This corresponds to an annual improvement of 2.2%. It is likely that other combinations will lead to similar results, for example by following full hybridisation first, with a potential saving of 44%104[26] and adding complementary measures. We have also applied an 18% increase in fuel consumption based on a realistic assessment of driving patterns. The Volkswagen Golf V FSI 1.6 l, with a 1,360 kg mass and 163 g CO2/km in NEDC was used as a starting point105.
large segment: For large vehicles, the same technologies as described for the medium segment can be applied. We believe, however, that the potential for improvements is higher and project fuel consumption in 2050 at 3.5 lge/100 km. In addition, we assume that political measures to reduce the sales of very large SUVs for passenger transport have been introduced, so that the size of vehicles within the segment will also decrease.
 vehicles
Battery electric vehicles already have a long history, starting in 1881 with the first electric vehicle powered by a secondary Planté battery106. Considerable activity in the 1990s resulted in a number of production scale electric cars such as the EV1 (GM), Saxo electrique (Citroen), Hijet EV (Daihatsu), Th!nk City (Ford), EV Plus (Honda), Altra EV (Nissan), Clio Electric (Renault) and the RAV 4 (Toyota). At the beginning of the 21st century the Tesla Roadster is among the most prominent. There is also a continuous flow of prototype electric cars, including the Ion (Peugeot), E1 (BMW), A-Class electric (DaimlerChysler) and E-com (Toyota).
Battery electric vehicles are already very efficient. A fuel consumption of 1.7 litres gasoline equivalent /100 km is reported for the Ford e-Ka107, 2.1 l/100 km for the Ford Ecostar and 3.4 l/100 km for the Chrysler van108. In the future we anticipate reference target values of 0.7 l/100 km for small size cars based on simulations for micro cars and 1.4 l/100 km for medium size vehicles based on simulations of city and compact class vehicles. We do not consider battery vehicles for the large vehicle segment.
There is a considerable gap between test cycle results and real driving experience because of auxiliary power needs, for example for heating, cooling and other electrical services. We have therefore applied a factor of 1.7 to the transfer from test cycle to real world driving based on simulation results.
Battery electric vehicles carry their energy along on board in a chemical form. The future battery technology for vehicles will most probably be based on Lithium because of good energy densities and cost prospects. Remaining issues associated with the application of batteries in vehicles are safety, long term durability and costs. However, under the most optimistic estimates for battery development, battery electric vehicles will mainly be small vehicles and those with dedicated usage profiles like urban fleets. Other problems to be solved are fast recharging and cycle stability. Technical solutions have already been proposed, and the cost reduction target for batteries in the long term is to reach 1/40th of today's figures. An enormous amount of research is being carried out, as well as production of the first vehicle-type batteries. This scenario assumes the introduction of battery electric vehicles from 2015.


plug-in-hybrid electric vehicles

Plug-in-hybrids are a combination of conventional hybrids and battery electric vehicles. They promise to provide both advantages: using low carbon and cheap energy from the grid, a wide travel range and grid independent driving when necessary. Plug-in-hybrids can be adapted from conventional hybrids by changing to a higher capacity battery, but different concepts, so-called series hybrids, are also proposed. Again, depending on the control strategy, different concepts are possible. The ICE, for example, is designed as a rangeextender to recharge the battery only or a battery plus ICE/generator provides energy, depending on the power need. Fuel and energy consumption depend very much on the system layout and control strategy, combined with the distance, frequency and speed driven. We project 2.3, 2.4, 4.5 lge/100 km following the announced specification for the Volvo Recharge concept car and other input109.

By the year 2050 we project that plug-in hybrids will use 10% more

energy in electric mode compared to our projection for battery

electric vehicles due to their increased weight. Once the battery is

below the recharge limit, the ICE/generator will provide the energy

in part or full. In this operating mode we again project 10% higher

fuel consumption than their conventional hybrid counterparts. In

terms of CO2 balance the distribution of kilometres driven in electric

and ICE modes is crucial. We anticipate that 80% of all kilometres

will be driven in electric mode. In this scenario the introduction of

plug-in-hybrid electric vehicles starts in 2015.

12


fuel cell hydrogen
Fuel cell vehicles have reached a high level of readiness for mass production. The polymer electrolyte membrane fuel cell provides high power density, resulting in low weight, cost and volume . Average drive cycle efficiencies have reached 3.5 lge/100 km111. Major problems still to be solved are durability, operating temperature range and cost reductions. Hydrogen on-board storage to provide a large driving range is a further issue not finally solved. Nevertheless, the technology seems ready to begin the transition into the mass market.
The main problem in fact is not so much the vehicles themselves as the hydrogen they need. Before the vehicles can operate, a hydrogen infrastructure needs to be established. The investment involved is risky, not least because of the competing electric systems. Because of energy losses in the hydrogen production chain, electricity appears to be cheaper, easier to handle and more environmentally friendly ­ at least until there is renewable electricity in abundance.
The hydrogen fuel cell vehicle might find its niche, however, where the driving range of battery electric vehicles is too low and/or locally emission free driving is demanded or the freedom from grid-connecting is valued more highly. We have projected a 35% improvement compared to today's fuel cell vehicles as the target reference value because of the potential for both fuel cell system improvement and lightweight, rolling resistance and aerodynamic vehicles, as already described.

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GLOBAL ENERGY [R]EVOLUTION A SUSTAINABLE GLOBAL ENERGY OUTLOOK

OECD Europe OECD North America
OECD Pacific Transition Economies
China India Developing Asia Latin America Africa Middle East

projection of future vehicle technology mix We are convinced that the share of hybrid cars will grow enormously. For the industrialised regions, we anticipate a sales share of 65% for hybrid power trains by 2050 and for all other regions 50%, apart from Africa, with 25%. This share includes all types of non-grid connected hybrids. In 2050 the balance of different hybrids will be that in Europe, North America and OECD Pacific roughly 20% are powered by conventional ICE engines, roughly 40% are gridconnectable and 40% are autonomous hybrids. For all other regions, 34% will be conventional, a third plug-in-hybrids and a third autonomous hybrids. Africa is again treated differently.
To power all sizes of vehicles with the same technology does not make sense. We have therefore further projected that a large share of plugin-electric cars in the small vehicle segment (80%) will be battery electric vehicles. Two-thirds of the medium sized vehicles and all of the large vehicles will be plug-in-hybrids, thus still having an internal combustion engine on board.
projection of vehicle segment split
We have disaggregated the light duty vehicle sales into three segments: small, medium and large vehicles. This gives us the opportunity to show the effect of `driving smaller cars'. The size and CO2 emissions of the vehicles are particularly interesting in the light of the enormous growth predicted in the LDV stock. For our purposes we have divided up the numerous car types as follows. The small car bracket includes city, supermini, microvans, mini SUV, minicompact cars and two seaters. The medium sized bracket includes lower medium/subcompact, medium class and compact cars, car derived vans and small station wagons, upper medium class, midsize cars and station wagons, executive class, passenger vans (subcompact, compact and standard MPV), car derived pickups, subcompact and compact SUVs, 2WD and 4WD. Within the large car bracket we have included all kinds of luxury class, luxury MPV, medium and heavy vans, compact and full-size pickup trucks (2WD, 4WD), standard and luxury SUVs.
In examining the segment split, we have focused most strongly on the two world regions which will be the largest emitters of CO2 from cars in 2050: North America and China. In North America today the small vehicle segment is almost non-existant. We have nonetheless applied a considerable growth rate of 8% per year, triggered by rising fuel prices and possibly vehicle taxes. For China, we have anticipated the same share of the mature car market as for Europe and projected that the small segment will grow by 2.3% per year at the expenses of the larger segments in the light of rising mass mobility. The segment split is shown in Figure 12.5.


projection of switch to alternative fuels
A switch to renewable fuels in the car fleet is one of the cornerstones of our low CO2 car scenario, with the most prominent element the direct use of renewable electricity in cars. The different types of electric and hybrid cars, such as battery electric and plug-in-hybrid, are summarised as `plug-in electric'. Their introduction will start in industrialised countries in 2015, following an s-curve pattern, and are projected to reach about 40% of total LDV sales in the EU, North America and the Pacific OECD by 2050. Due to the higher costs of the technology and renewable electricity availability, we have slightly delayed progress in other countries. More cautious targets are applied for Africa. The sales split in vehicles by fuel is presented in Figure 12.7 for 2005 and 2050.

projection of global vehicle stock development
Differences in forecasts for the growth of vehicle sales in developing countries are huge112. We have mainly used the projections from the Reference Scenario. Slight changes were applied to vehicle sales in saturated markets such as Europe and North America, where we believe that massive policy intervention to promote modal shift and alternative forms of car usage will show effects in vehicle sales in the long run.
references 112 MEYER, I., M. LEIMBACH, AND C.C. JAEGER (2007): INTERNATIONAL PASSENGER TRANSPORT AND CLIMATE CHANGE: A SECTOR ANALYSIS IN CAR DEMAND AND ASSOCIATED CO2 EMISSIONS FROM 2000 TO 2050. ENERGY POLICY. 35(12): P. 6332-6345.

GLOBAL ENERGY [R]EVOLUTION A SUSTAINABLE GLOBAL ENERGY OUTLOOK

projection of kilometres driven per year
Until a complete shift from fossil to renewable fuels is completed, driving on the road will be linked to CO2 emissions. Thus driving less contributes to our target for emissions reduction. However this is not necessarily linked to less mobility because we have relied on the multitude of excellent opportunities for shifts from individual passenger road transport towards less CO2 intense public or nonmotorised transport.
In our scenario we have taken into account the effects of a variety of policy measures which could be implemented all over the world and summarised them in two indicators: numbers of vehicles (see the section above) and annual kilometres driven (AKD). For AKD we have applied a 0.25% reduction per year, assuming the first visible effect in 2010, resulting in a roughly 10% reduction by 2050. This has been coordinated into a model which projects the shift from car to rail or bus at 5%, with the additional 5% coming from LDVs as part of the predicted demand reduction for all modes of transport113.
Figure 12.9 shows the effect of vehicle travel reduction over time by world region. China shows a less typical pattern: while in China today many vehicles are used intensively, with many kilometres travelled per year, with a growing individual mobility we assume that AKD will move towards the global average.


summary of scenario results114
A combination of ambitious efforts to introduce higher efficiency vehicle technologies, a major switch to grid-connected electric vehicles and incentives for travellers to save CO2 all lead to the conclusion that it is possible to reduce emissions from well-to-wheel in 2050 by roughly 25%115 compared to 1990 and 40% compared to 2005. Even so, 74% of the final energy used in cars will still come from fossil fuel sources, 70% from gasoline and diesel. Renewable electricity covers 19% of total car energy demand, bio fuels cover 5% and hydrogen 2%. Energy consumption in total is reduced by 23% in 2050 compared to 2005, in spite of tremendous increases in some world regions. The peak in global CO2 emissions occurs between 2010 and 2015. From 2010 onwards, new legislation in the US and Europe contributes towards breaking the upwards trend in emissions. From 2020 onwards, we can see the effect of introducing gridconnected electric cars. The development of CO2 emissions, taking into account upstream emissions, is shown in Figure 12.8.
policy recommendations | TARGETS

At a time when governments around the world are in the process of liberalising their electricity markets, the increasing competitiveness of renewable energy should lead to higher demand. Without political support, however, renewable energy remains at a disadvantage, marginalised by distortions in the world's electricity markets created by decades of massive financial, political and structural support to conventional technologies. Developing renewables will therefore require strong political and economic efforts, especially through laws which guarantee stable tariffs over a period of up to 20 years.
At present new renewable energy generators have to compete with old nuclear and fossil fuelled power stations which produce electricity at marginal costs because consumers and taxpayers have already paid the interest and depreciation on the original investments. Political action is needed to overcome these distortions and create a level playing field.
Renewable energy technologies would already be competitive if they had received the same attention as fossil fuels and nuclear in terms of R&D funding, subsidies, and if external costs were reflected in energy prices. Removing public subsidies to fossil fuels and nuclear and applying the `polluter pays' principle to the energy markets, would go a long way to level the playing field and drastically reduce the need for renewables support. Unless this principle is fully implemented, renewable energy technologies need to receive compensation and additional support measures in order to compete in the distorted market.
13 Support mechanisms for the different sectors and technologies can
vary according to regional characteristics, priorities or starting points. But some general principles should apply to any kind of support mechanism. These criteria are:
effectiveness in reaching the targets The experiences in some countries show that it is possible with the right design of a support mechanism to reach agreed national targets. Any system to be adopted at a national level should focus on being effective in deploying new installed capacity and meeting the targets.
long term stability Whether price or quantity-based, policy makers need to make sure that investors can rely on the long-term stability of any support scheme. It is absolutely crucial to avoid stop-and-go markets by changing the system or the level of support frequently. Therefore market stability has to be created with a stable long-term support mechanism.
simple and fast administrative procedures Complex licensing procedures constitute one of the most difficult obstacles that renewables projects have to face. Administrative barriers have to be removed at all levels. A `one-stop-shop' system should be introduced and a clear timetable set for approving projects.

encouraging local and regional benefits and public acceptance The development of renewable technologies can have a significant impact on local and regional areas, resulting from both installation and manufacturing. Some support schemes include public involvements that hinder or facilitate the acceptance of renewable technologies. A support scheme should encourage local/regional development, employment and income generation. It should also encourage public acceptance of renewables, including their positive impact and increased stakeholder involvement.
The following is an overview of current political frameworks and barriers that need to be overcome in order to unlock renewable energy's great potential to become a major contributor to global energy supply. In the process it would also contribute to sustainable economic growth, high quality jobs, technology development, global competitiveness and industrial and research leadership.
renewable energy targets
In recent years, as part of their greenhouse gas reduction policies as well as for increasing security of energy supply, an increasing number of countries have established targets for renewable energy. These are either expressed in terms of installed capacity or as a percentage of energy consumption. Although these targets are not often legally binding, they have served as an important catalyst for increasing the share of renewable energy throughout the world, from Europe to the Far East to the USA.
A time horizon of just a few years is not long enough in the electricity sector, where the investment horizon can be up to 40 years. Renewable energy targets therefore need to have short, medium and long term steps and must be legally binding in order to be effective. They should also be supported by mechanisms such as the `feed-in tariff'. In order for the proportion of renewable energy to increase significantly, targets must be set in accordance with the local potential for each technology (wind, solar, biomass etc) and according to the local infrastructure, both existing and planned.
In recent years the wind and solar power industries have shown that it is possible to maintain a growth rate of 30 to 35% in the renewables sector. In conjunction with the European Photovoltaic Industry Association, the European Solar Thermal Power Industry Association and the European Wind Energy Association116, Greenpeace and EREC have documented the development of those industries from 1990 onwards and outlined a prognosis for growth up to 2020.

demands for the energy sector
Greenpeace and the renewables industry have a clear agenda for changes which need to be made in energy policy to encourage a shift to renewable sources. The main demands are:
· Phase out all subsidies for fossil fuels and nuclear energy.
· Internalise the external costs (social and environmental) of energy production through `cap and trade' emissions trading.
· Mandate strict efficiency standards for all energy consuming appliances, buildings and vehicles.
· Establish legally binding targets for renewable energy and combined heat and power generation.
· Reform the electricity markets by guaranteeing priority access to the grid for renewable power generators.
· Provide defined and stable returns for investors, for example through feed-in tariff programmes.
· Implement better labelling and disclosure mechanisms to provide more environmental product information.
· Increase research and development budgets for renewable energy and energy efficiency.
Conventional energy sources receive an estimated $250-300117 billion in subsidies per year worldwide, resulting in heavily distorted markets. Subsidies artificially reduce the price of power, keep renewable energy out of the market place and prop up noncompetitive technologies and fuels. Eliminating direct and indirect subsidies to fossil fuels and nuclear power would help move us towards a level playing field across the energy sector. The 2001 report of the G8 Renewable Energy Task Force argued that "readdressing them [subsidies] and making even a minor re-direction of these considerable financial flows toward renewables, provides an opportunity to bring consistency to new public goals and to include social and environmental costs in prices." The Task Force recommended that "G8 countries should take steps to remove incentives and other supports for environmentally harmful energy technologies, and develop and implement market-based mechanisms that address externalities, enabling renewable energy technologies to compete in the market on a more equal and fairer basis."
Renewable energy would not need special provisions if markets were not distorted by the fact that it is still virtually free for electricity producers (as well as the energy sector as a whole) to pollute. Subsidies to fully mature and polluting technologies are highly unproductive. Removing subsidies from conventional electricity would not only save taxpayers' money. It would also dramatically reduce the need for renewable energy support.
This is a fuller description of what needs to be done to eliminate or compensate for current distortions in the energy market.
removal of energy market distortions A major barrier preventing renewable energy from reaching its full potential is the lack of pricing structures in the energy markets that reflect the full costs to society of producing energy. For more than a century, power generation was characterised by national monopolies with mandates to finance investments in new production capacity through state subsidies and/or levies on electricity bills. As many countries are moving in the direction of more liberalised electricity markets, these options are no longer available, which puts new generating technologies, such as wind power, at a competitive disadvantage relative to existing technologies. This situation requires a number of responses.

internalisation of the social and environmental costs of polluting energy The real cost of energy production by conventional energy includes expenses absorbed by society, such as health impacts and local and regional environmental degradation - from mercury pollution to acid rain ­ as well as the global negative impacts from climate change. Hidden costs include the waiving of nuclear accident insurance that is too expensive to be covered by the nuclear power plant operators. The Price Anderson Act, for instance, limits the liability of US nuclear power plants in the case of an accident to an amount of up to $ 98 million per plant, and only $15 million per year per plant, with the rest being drawn from an industry fund of up to $ 10 billion. After that the taxpayer becomes responsible118.

Environmental damage should, as a priority, be rectified at source.

Translated into energy generation that would mean that, ideally,

production of energy should not pollute and it is the energy

producers' responsibility to prevent it. If they do pollute they should pay an amount equal to the damage the production causes to

13

society as a whole. The environmental impacts of electricity

generation can be difficult to quantify, however. How do we put a

price on lost homes on Pacific Islands as a result of melting icecaps

or on deteriorating health and human lives?

policy recommendations | TARGETS

An ambitious project, funded by the European Commission - ExternE ­ has tried to quantify the true costs, including the environmental costs, of electricity generation. It estimates that the cost of producing electricity from coal or oil would double and that from gas would increase by 30% if external costs, in the form of damage to the environment and health, were taken into account. If those environmental costs were levied on electricity generation according to their impact, many renewable energy sources would not need any support. If, at the same time, direct and indirect subsidies to fossil fuels and nuclear power were removed, the need to support renewable electricity generation would seriously diminish or cease to exist.

introduce the "polluter pays" principle As with the other subsidies, external costs must be factored into energy pricing if the market is to be truly competitive. This requires that governments apply a "polluter pays" system that charges the emitters accordingly, or applies suitable compensation to non-emitters. Adoption of polluter pays taxation to electricity sources, or equivalent compensation to renewable energy sources, and exclusion of renewables from environment-related energy taxation, is essential to achieve fairer competition in the world's electricity markets.

electricity market reform Renewable energy technologies could already be competitive if they had received the same attention as other sources in terms of R&D funding and subsidies, and if external costs were reflected in power prices. Essential reforms in the electricity sector are necessary if new renewable energy technologies are to be accepted on a larger scale. These reforms include:
removal of electricity sector barriers Complex licensing procedures and bureaucratic hurdles constitute one of the most difficult obstacles faced by renewable energy projects in many countries. A clear timetable for approving projects should be set for all administrations at all levels. Priority should be given to renewable energy projects. Governments should propose more detailed procedural guidelines to strengthen the existing legislation and at the same time streamline the licensing procedure for renewable energy projects.
A major barrier is the short to medium term surplus of electricity generating capacity in many OECD countries. Due to over-capacity it is still cheaper to burn more coal or gas in an existing power plant than to build, finance and depreciate a new renewable power plant. The effect is that, even in those situations where a new technology would be fully competitive with new coal or gas fired power plants, the investment will not be made. Until we reach a situation where electricity prices start reflecting the cost of investing in new capacity rather than the marginal cost of existing capacity, support for renewables will still be required to level the playing field.
Other barriers include the lack of long term planning at national,
13 regional and local level; lack of integrated resource planning; lack
of integrated grid planning and management; lack of predictability and stability in the markets; no legal framework for international bodies of water; grid ownership by vertically integrated companies and a lack of long-term R&D funding.
There is also a complete absence of grids for large scale renewable energy sources, such as offshore wind power or concentrating solar power (CSP) plants; weak or non-existant grids onshore; little recognition of the economic benefits of embedded/distributed generation; and discriminatory requirements from utilities for grid access that do not reflect the nature of the renewable technology.
The reforms needed to address market barriers to renewables include:
· Streamlined and uniform planning procedures and permitting systems and integrated least cost network planning.
· Fair access to the grid at fair, transparent prices and removal of discriminatory access and transmission tariffs.
· Fair and transparent pricing for power throughout a network, with recognition and remuneration for the benefits of embedded generation.
· Unbundling of utilities into separate generation and distribution companies.
· The costs of grid infrastructure development and reinforcement must be carried by the grid management authority rather than individual renewable energy projects.
· Disclosure of fuel mix and environmental impact to end users to enable consumers to make an informed choice of power source.

priority grid access Rules on grid access, transmission and cost sharing are very often inadequate. Legislation must be clear, especially concerning cost distribution and transmission fees. Renewable energy generators should be guaranteed priority access. Where necessary, grid extension or reinforcement costs should be borne by the grid operators, and shared between all consumers, because the environmental benefits of renewables are a public good and system operation is a natural monopoly.
support mechanisms for renewables The following section provides an overview of the existing support mechanisms and experiences of their operation. Support mechanisms remain a second best solution for correcting market failures in the electricity sector. However, introducing them is a practical political solution to acknowledge that, in the short term, there are no other practical ways to apply the polluter pays principle.
Overall, there are two types of incentive to promote deployment of renewable energy. These are Fixed Price Systems where the government dictates the electricity price (or premium) paid to the producer and lets the market determine the quantity, and Renewable Quota Systems (in the USA referred to as Renewable Portfolio Standards) where the government dictates the quantity of renewable electricity and leaves it to the market to determine the price. Both systems create a protected market against a background of subsidised, depreciated conventional generators whose external environmental costs are not accounted for. Their aim is to provide incentives for technology improvements and cost reductions, leading to cheaper renewables that can compete with conventional sources in the future.
The main difference between quota based and price based systems is that the former aims to introduce competition between electricity producers. However, competition between technology manufacturers, which is the most crucial factor in bringing down electricity production costs, is present regardless of whether government dictates prices or quantities. Prices paid to wind power producers are currently higher in many European quota based systems (UK, Belgium, Italy) than in fixed price or premium systems (Germany, Spain, Denmark).
· fixed price systems Fixed price systems include investment subsidies, fixed feed-in tariffs, fixed premium systems and tax credits.
Investment subsidies are capital payments usually made on the basis of the rated power (in kW) of the generator. It is generally acknowledged, however, that systems which base the amount of support on generator size rather than electricity output can lead to less efficient technology development. There is therefore a global trend away from these payments, although they can be effective when combined with other incentives.
Fixed feed-in tariffs (FITs), widely adopted in Europe, have proved extremely successful in expanding wind energy in Germany, Spain and Denmark. Operators are paid a fixed price for every kWh of electricity they feed into the grid. In Germany the price paid varies according to the relative maturity of the particular technology and reduces each year to reflect falling costs. The additional cost of the system is borne by taxpayers or electricity consumers.


The main benefit of a FIT is that it is administratively simple and encourages better planning. Although the FIT is not associated with a formal Power Purchase Agreement, distribution companies are usually obliged to purchase all the production from renewable installations. Germany has reduced the political risk of the system being changed by guaranteeing payments for 20 years. The main problem associated with a fixed price system is that it does not lend itself easily to adjustment ­ whether up or down - to reflect changes in the production costs of renewable technologies.
Fixed premium systems, sometimes called an "environmental bonus" mechanism, operate by adding a fixed premium to the basic wholesale electricity price. From an investor perspective, the total price received per kWh is less predictable than under a feed-in tariff because it depends on a constantly changing electricity price. From a market perspective, however, it is argued that a fixed premium is easier to integrate into the overall electricity market because those involved will be reacting to market price signals. Spain is the most prominent country to have adopted a fixed premium system.
Tax credits, as operated in the US and Canada, offer a credit against tax payments for every kWh produced. In the United States the market has been driven by a federal Production Tax Credit (PTC) of approximately 1.8 cents per kWh. It is adjusted annually for inflation.
· renewable quota systems Two types of renewable quota systems have been employed - tendering systems and green certificate systems.
Tendering systems involve competitive bidding for contracts to construct and operate a particular project, or a fixed quantity of renewable capacity in a country or state. Although other factors are usually taken into account, the lowest priced bid invariably wins. This system has been used to promote wind power in Ireland, France, the UK, Denmark and China.
The downside is that investors can bid an uneconomically low price in order to win the contract, and then not build the project. Under the UK's NFFO (Non-Fossil Fuel Obligation) tender system, for example, many contracts remained unused. It was eventually abandoned. If properly designed, however, with long contracts, a clear link to planning consent and a possible minimum price, tendering for large scale projects could be effective, as it has been for offshore oil and gas extraction in Europe's North Sea.

Tradable green certificate (TGC) systems operate by offering "green certificates" for every kWh generated by a renewable producer. The value of these certificates, which can be traded on a market, is then added to the value of the basic electricity. A green certificate system usually operates in combination with a rising quota of renewable electricity generation. Power companies are bound by law to purchase an increasing proportion of renewables input. Countries which have adopted this system include the UK, Sweden and Italy in Europe and many individual states in the US, where it is known as a Renewable Portfolio Standard.
Compared with a fixed tender price, the TGC model is more risky for the investor, because the price fluctuates on a daily basis, unless effective markets for long-term certificate (and electricity) contracts are developed. Such markets do not currently exist. The system is also more complex than other payment mechanisms.
Which one out of this range of incentive systems works best? Based on past experience it is clear that policies based on fixed tariffs and premiums can be designed to work effectively. However, introducing them is not a guarantee for success. Almost all countries with experience in mechanisms to support renewables have, at some point in time, used feed-in tariffs, but not all have contributed to an increase in renewable electricity production. It is the design of a mechanism, in combination with other measures, which determines its success.
renewables for heating and cooling Largely forgotten, but equally important, is the heating and cooling sector. In many
regions of the world, such as Europe, nearly half of the total energy 13
demand is for heating/cooling, a demand which can be addressed easily at competitive prices.
Policies should make sure that specific targets and appropriate measures for renewable heating and cooling are part of any national renewables strategy. These should foresee a coherent set of measures dedicated to the promotion of renewables for heating and cooling, including financial incentives, awareness raising campaigns, training of installers, architects and heating engineers, and demonstration projects. For new buildings, and those undergoing major renovation, an obligation to cover a minimum share of heat consumption by renewables should be introduced, as already implemented in some countries and regions.
Measures should stimulate the deployment of the large potential for cost effective renewable heating and cooling, available already with today's technologies. At the same time, increased R&D efforts should be undertaken, particularly in the fields of heat storage and renewable cooling.

The definition of different sectors is analog to the sectorial break down of the IEA World Energy Outlook series. All definitions below are from the IEA Key World Energy Statistics
Industry sector: Consumption in the industry sector includes the following subsectors (energy used for transport by industry is not included -> see under "Transport") · Iron and steel industry · Chemical industry · Non-metallic mineral products e.g. glass, ceramic, cement etc. · Transport equipment · Machinery · Mining · Food and tobacco · Paper, pulp and print · Wood and wood products (other than pulp and paper) · Construction · Textile and Leather
Transport sector: The Transport sector includes all fuels from transport such as road, railway, aviation, domestic and navigation. Fuel
used for ocean, costal and inland fishing is included in "Other Sectors". 14