Energy [R]evolution: A Sustainable Energy Outlook for Canada

report 3rd edition 2010 canada energy scenario

energy[r]evolutionA SUSTAINABLE ENERGY OUTLOOK FOR CANADA

EUROPEAN RENEWABLE ENERGY COUNCIL

2

image THE INDIGENOUS NENETS PEOPLE MOVE EVERY 3 OR 4 DAYS SO THAT THEIR REINDEER DO NOT OVER GRAZE THE GROUND AND THEY DO NOT OVER FISH THE LAKES. THE YAMAL PENINSULA IS UNDER HEAVY THREAT FROM GLOBAL WARMING AS TEMPERATURES INCREASE AND RUSSIA’S ANCIENT PERMAFROST MELTS.

partners

Greenpeace International,European Renewable Energy Council (EREC)

date August 2010

project manager & lead authorSven Teske, Greenpeace International

EREC Christine Lins

Greenpeace InternationalSven Teske

Greenpeace CanadaDave Martin, Keith Stewart

research & co-authorsDLR, Institute of TechnicalThermodynamics, Department ofSystems Analysis and TechnologyAssessment, Stuttgart, Germany: Dr. Wolfram Krewitt (†),Dr. ThomasPregger, Dr. Sonja Simon, Dr. TobiasNaegler. DLR, Institute of Vehicle

3

© GREENPEACE/WILL ROSE

Concepts, Stuttgart, Germany: Dr.Stephan Schmid Ecofys BV, Utrecht,The Netherlands: Wina Graus, ElianeBlomen. Greenhouse DevelopmentRights (Chapter 2.3) EcoEquity, PaulBaer, Assistant Professor, School of Public Policy, Georgia Institute of Technology, Atlanta, USA.

editor Crispin Aubrey

printing PrimaveraQuint, the Netherlands,www.primaveraquint.nl

design & layout onehemisphere,Sweden, www.onehemisphere.se

contact [email protected],[email protected],[email protected]

for further information about the global, regional and national scenarios please visit the energy [r]evolution website: www.energyblueprint.info/Published by Greenpeace International and EREC. (GPI reference number JN 330). Printed on 100% post consumer recycled chlorine-free paper.

“will we look into the eyes of our children and confessthat we had the opportunity,but lacked the courage?that we had the technology,but lacked the vision?”

Energy [r]evolution is thecentral challenge of ourtime. Our response to thatchallenge will define ourcharacter, shape oureconomy, and to a largeextent determine our future.

The year 2010 will beremembered for thebiggest environmentaldisaster in history to date.The larger lesson of theBritish Petroleum (BP) oilspill in the Gulf of Mexicois that we can no longerassume a comfortable,controlling relationshipwith nature. Climatechange extends that idea.The science is clear: wemust engineer a quickreduction of carbonemissions to avoid somevery frightening climatechange impacts.

Yet Canada’s response to thisthreat remains tepid. Why? Twocore assumptions inform energydebate in North America. Both holdus back from the necessary energy[r]evolution, and both are wrong.

First, some worry clean energycannot power our economy. Thefear is that while we might safelydabble in renewables, reallykicking our fossil fuel habit wouldbring about silent factories andflickering lights. That view ismistaken. Clean energy is fullyable to power our civilization—but only if we commit financialresources comparable to those wehave invested in fossil fuels. That scale is enormous.

Second, some argue thatcommitting to clean energy atthat scale will bankrupt us. This view is also incorrect. Infact, even ignoring its finitenature, fossil fuel is the economicthreat. The Stern Report (TheEconomics of Climate Change:The Stern Review, CambridgeUniversity Press, 2006) firmlyestablished that energy[r]evolution is an economicnecessity. Action to reduce carbonemissions is insurance against the economic turmoil thataccompanies a turbulent and warming climate.

foreword

4

© © FALLSVIEW / DREAMSTIME.COM

A ROW OF WINDMILLS AT DUSK IN PINCHER CREEK, ALBERTA, CANADA. THESE WIND TURBINES MAKE PINCHER CREEK THE WIND ENERGY CAPITAL OF CANADA.

But further, I believe clean energy is this century’s central economicopportunity. It is, in the words of German Chancellor Angela Merkel,the “third industrial revolution.” Without smart policy and clearthinking, Canada will miss this opportunity.

What might the energy [r]evolution look like?

We start with efficiency: our economic output per unit of energy caneasily double with smart energy use. Then we build an EnergyInternet—a massively interconnected, continent-wide grid supplied by amix of widely-distributed clean energy sources.

What energy sources? Giant solar thermal plants with storage tanks.Solar electricity (photovoltaics) will follow a cost-reduction curvesimilar to the microchip. Wind farms across the continent can beconnected together to provide a stable resource. Hydro remains apowerhouse. Tidal and biomass will contribute. Grid storage includescompressed air in caverns and underwater, low-friction flywheels,electric vehicles and pumped hydro.

The game-changer is enhanced geothermal systems (EGSs): the art of drilling and fracturing the hot dry rock that lies everywhere deepbeneath our feet. Instead of drilling for oil at sea, or fracturing rock for shale gas, we can mine enough heat from the earth to power ourcivilization many times over.

So the energy [r]evolution is possible. This document is a detailed andcomprehensive plan to get there. But this revolution is also the biggestchallenge modern humans have ever faced. It will take unprecedentedlevels of capital, international co-operation, and political will.

We cannot wait for the free market. We must intervene in a strong,cohesive and intelligent way. For each economic barrier, there is apolicy tool. Companies are willing to play smart, but need clear, long-term signals to commit.

It remains cheap to burn coal. It is still profitable to melt tar for oil.We need to respond with a strong and rising price on carbon.

The energy of the sun, earth and wind is free, but the equipment tocapture it is not. To lower the cost of clean energy, we need to lower thecost of capital. But debt financing is allergic to technology risk; bankersback the old, not the new. We break this barrier with government-backedGreen Bonds, loan guarantees and progressive feed-in tariffs.

But the single greatest barrier we face is psychological, and anaccompanying institutional lethargy. Not only must we understandthat a clean economy is possible, we must commit ourselves to itquickly, and fully. We cannot do tomorrow what we did yesterday.We cannot assume things will be ok if we avoid rocking the boat, if we stay our present course. We need, collectively, to wake up.

Much of the world now understands that the energy [r]evolution isinevitable, since we have no real choice in the matter. What remainsto be seen is if it happens on our terms, and our timeline—or onthose dictated by an ever-more unstable climate.

The question that faces Canada is not “will we participate?” but“how?” Will Canada be a net buyer or seller of clean technology?Putting policies in place to seed, support and grow our clean-techindustries is the single smartest action our federal government can take.

These are final innings in the climate fight. For some, that is reasonnot to try. Some still find reason to delay. But this task is neitheroptional nor leisurely.

Tom RandCLEANTECH LEAD ADVISOR, MARS DISCOVERY DISTRICT

AUTHOR, KICK THE FOSSIL FUEL HABIT: 10 CLEAN

TECHNOLOGIES TO SAVE OUR WORLD

DIRECTOR, VCI GREEN FUNDS

AUGUST 2010

5

6

WORLD ENERGY [R]EVOLUTIONA SUSTAINABLE ENERGY OUTLOOK

foreword 4

introduction 8

executive summary 10

climate protection & energy policy 16

1.1 the kyoto protocol 181.2 international energy policy 181.3 renewable energy targets 181.4 policy changes in the energy sector 19

implementing the energy [r]evolution 20

2.1 canadian policy issues 212.1.1 canada: an energy superpower? 212.1.2 a superpower without sovereignty? 222.1.3 a national energy strategy for canada:

energy [r]evolution or status quo? 232.1.4 energy [r]evolution and the tar sands 242.2 ftsm: a support scheme for renewable power

in developing countries 262.2.1 bankable renewable energy support schemes 262.2.2 the feed-in tariff suppor mechanism 27 2.2.3 financing the energy [r]evolution with ftsm 282.2 ftsm: a support scheme for renewable power in 2.3 the greenhouse development rights framework 302.3.1 calculating greenhouse gas emissions under the

greenhouse development rights framework 302.3.2 applying gdr to the energy [r]evolution scenarios 33

nuclear power and climate protection 35

3.1 a false solution to climate protection 363.2 nuclear power blocks solutions 373.3 the dangers of nuclear power 373.3.1 nuclear proliferation 373.3.2 nuclear waste 383.3.3 safety risks 38

the energy [r]evolution 40

4.1 key principles 414.2 from principles to practice 424.2.1 a development pathway 424.3 new business model 444.4 the new electricity grid 464.5 hybrid systems 484.6 smart grids 484.7 the super grid 51

scenarios for a future energy supply 52

5.1 scenarios background 535.2 oil and gas price projections 545.3 cost of CO2 emissions 545.4 cost projections for efficient fossil fuel generation

and carbon capture and storage (CCS) 555.5 cost projections for renewable energy technologies 565.5.1 photovoltaics 565.5.2 concentrating solar power 575.5.3 wind power 575.5.4 biomass 585.5.5 geothermal 585.5.6 ocean energy 59

5.5.7 hydro power 595.5.8 summary of renewable energy cost development 605.5.9 assumed growth rates in different scenarios 61

key results: the canadian energy [r]evolution 66

6.1 canadian energy demand to 2050 676.2 electricity generation 686.3 future costs of electricity generation 696.4 future employment 706.5 heating and cooling supply 706.6 transportation 716.7 canada’s CO2 emissions 726.8 canada’s primary energy consumption 726.9 future investment 736.9.1 investment in new power plants 736.9.2 fossil fuel power generation investment 746.9.3 fuel cost savings with renewable energy 74

energy resources and security of supply 76

7.1 oil 777.1.1 the reserves chaos 777.1.2 non-conventional oil reserves 777.2 gas 777.2.1 shale gas 787.3 coal 787.4 nuclear 787.5 renewable energy 797.5.1 the global potential for sustainable biomass 89

energy technologies 94

8.1 fossil fuel technologies 958.1.1 coal combustion technologies 958.1.2 gas combustion technologies 958.1.3 carbon reduction technologies 958.1.4 carbon dioxide storage 968.2 nuclear technologies 978.2.1 nuclear reactor designs: evolution and safety issues 978.3 renewable energy technologies 988.3.1 solar power (photovoltaics) 988.3.2 concentrating solar power (CSP) 998.3.3 solar thermal collectors 1008.3.4 wind power 1008.3.5 biomass energy 1018.3.6 geothermal energy 1038.3.7 hydro power 1038.3.8 ocean energy 104

climate and energy policy recommendations 105

9.1 climate policy 1069.2 energy policy and market regulation 1089.3 targets and incentives for renewables 1089.3.1 fixed price systems 1099.3.2 renewables quota systems 1109.4 renewables for heating and cooling 1109.5 energy efficiency and innovation 1119.5.1 appliances and lighting 1119.5.2 buildings 1129.5.3 transport 112

glossary & appendix 113

contents

1

2

3

4

5

6

7

9

10

8

figure 0.1 development of primary energy consumption in canada (in PJ/a) to 2050, under three scenarios 15

figure 2.1 global demand for oil under four scenarios 25figure 2.2 ftsm scheme 26figure 2.3 feed-in tariffs versus conventional power generation 27figure 2.4 emission reduction wedges under the energy

[r]evolution scenario 31figure 2.5 emission reduction wedges under the advanced

energy [r]evolution scenario 31figure 2.6 annual GHG emissions and reduction

pathways under the GDR, for the european union, us, china and india 32

figure 3.1 new reactor construction starts in past six years 37figure 3.2 the nuclear fuel chain 39figure 4.1 energy loss, by centralized generation systems 42figure 4.2 a decentralized energy future 43figure 4.3 overview of the future power system with

high penetration of renewables 47figure 4.4 the smart-grid vision for the enery [r]evolution 50figure 5.1 future development of investment costs

(normalized to current cost levels) for renewable energy technologies 60

figure 5.2 expected development of electricity generation costs from fossil fuel and renewable options example for oecd north america 60

figure 6.1 projection of energy demand in canada to 2050, by sector, under three scenarios 67

figure 6.2 development of electricity demand in canada to 2050, by sector, under three scenarios 68

figure 6.3 development of heat demand in canada to 2050, by sector, under three scenarios 68

figure 6.4 development of electricity generation (in TWh/a) structure in canada to 2050, under three scenarios 69

figure 6.5 development total electricity generation costs ($billion/a) & development of specific electricity generation costs (cents/kWh), to 2050, under three scenarios 69

figure 6.6 heating and cooling supply (in PJ/a) in canada, to 2050, under three scenarios 71

figure 6.7 energy (PJ/a) for transportation in canada, to 2050, under three scenarios 72

figure 6.8 development of CO2 emissions in canada to 2050, by sector, under the energy [r]evolution scenarios 72

figure 6.9 development of primary energy consumption in canada (in PJ/a) to 2050, under three scenarios 72

figure 6.10 investment shares: reference scenario vs. energy [r]evolution scenarios 72

figure 6.11 change in cumulative power plant investment in both energy [r]evolution scenarios 72

figure 6.12 renewable energy investment costs in canada, 2007–2050 74

figure 7.1 energy resources of the world 88figure 8.1 photovoltaics technology 98figure 8.2 csp technologies: parabolic trough, central

receiver/solar tower and parabolic dish 99figure 8.3 flat panel solar technology 100figure 8.4 wind turbine 101figure 8.5 biomass power plant 101figure 8.6 geothermal power plant 103figure 8.7 hydro power plant 103

table 2.1 assumptions for ftsm calculations 28table 2.2 ftsm key parameters - energy [r]evolution 29table 2.3 ftsm key parameters - adv energy [r]evolution 29table 2.4 ftsm programme 29table 2.5 renewable power for non-oecd countries

under the ftsm programme 30table 2.6 GDR factors and RCIs for IEA regions and select

countries, for 2010, 2020 and 2030 31table 2.7 greenhouse development rights framework

(GDR) applied to the energy [r]evolution scenario 34

table 2.8 greenhouse development rights framework (GDR) applied to the energy [r]evolution scenario 34

table 4.1 power plant value chain 44table 4.2 utilities today 44table 5.1 development projections for fossil fuel prices,

in CA$2008 54table 5.2 assumptions on CO2 emissions cost

development (CA$/tCO2) 54table 5.3 d of efficiency and investment costs

for selected new power plant technologies 55table 5.4 generation from photovoltaics, 2007–2050 56table 5.5 generation from concentrating solar power,

2007–2050 57table 5.6 generation from wind power, 2007–2050 57table 5.7 generation from biomass, 2007–2050 58table 5.8 generation from geothermal, 2007–2050 58table 5.9 generation from ocean energy, 2007–2050 59table 5.10 generation from hydro, 2007–2050 59table 5.11 assumed annual average growth rates

for renewable energy technologies 61table 6.1 projection of renewable electricity capacity

(in GW) in canada, under both energy [r]evolution scenarios 68

table 6.2 employment and investment in canada to 2030, under three scenarios 70

table 6.3 investment costs and fuel savings in the three scenarios 75

table 7.1 overview of known worldwide fossil fuel reserves and resources 78

table 7.2 assumptions on fossil fuel use in the reference and energy [r]evolution scenarios 79

table 7.3 technical potential per renewable energy technology, for 2020, 2030 and 2050 89

table 9.1 new renewables built or contracted, in ontario, as of june 2010 110

7

list of figures list of tables

© GP/NICK COBBING

image GREENPEACE AND AN INDEPENDENT NASA-FUNDED SCIENTIST COMPLETED MEASUREMENTS OFMELT LAKES ON THE GREENLAND ICE SHEET THAT SHOWITS VULNERABILITY TO WARMING TEMPERATURES.

image A WORKER ENTERS A TURBINE TOWER FOR MAINTENANCE AT DABANCHENG WIND FARM. CHINA’S BEST WIND RESOURCES ARE MADE POSSIBLE BY THE NATURAL BREACH INTIANSHAN (TIAN MOUNTAIN).

© GP/HU WEI

“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.”

introduction

what’s possible in terms of energy supply strategies for the future andhow to develop a sustainable energy and climate policy.

Access to energy is of strategic importance for every country in theworld. Over the past few years oil prices have gone up and down like arollercoaster, jumping to a record high in July 2008 of $147.27 andthen falling back again to $33.87 in December. Even so, over thewhole of 2009 the average oil price was still between $60 and $80per barrel. At the same time, with gas prices in Europe rising in linewith the price of oil, the impact on both the heating and powersectors has been huge.

Security of energy supply is not only influenced by the cost of fuels,however, but by their long term physical availability. Countries withouttheir own fossil fuel supplies have increasingly shown interest inrenewable energy sources, not only because of the price stability thisbrings but because they are indigenous and locally produced.

Renewable energy technologies produce little or no greenhouse gasesand rely on virtually inexhaustible natural elements for their 'fuel'.Some of these technologies are already competitive. The wind powerindustry, for example, has continued its explosive growth in the face of

Energy policy has a dramatic impact across the social, political andeconomic spectrum. Governments and businesses must focus on the factthat energy is the lifeblood of the economy. For scientists, the crucialmatter is the threat of climate change brought about by burning fossilfuels. NGO’s concentrate on the environmental and social impacts, andeconomists on the potential of a shift in the way our energy is produced.For engineers, the task is developing new technologies to supply andconsume energy in a smarter way. But at the end of the day, we are allconsumers and we all must deal with the full reality of our energysystem—from volatile prices to oil spills. Access to sufficient energy isvital to making our economies work but at the same time, our demandfor energy has become the main source of the greenhouse gas emissionsthat put our climate at risk. Something needs to change.

While the last climate change summit in Copenhagen failed to producean agreement, international negotiations to address the issue remainhigh on the political agenda. At the same time, highly volatile fossil fuelprices are creating more and more uncertainty for the global economy,creating an indirect incentive for investing in renewable energytechnologies, which are now booming. Against this backdrop, the thirdedition of the Energy [R]evolution analysis takes a deep plunge into

8


Christine LinsSECRETARY GENERAL

EUROPEAN RENEWABLE

ENERGY COUNCIL (EREC)

AUGUST 2010

Dave MartinCLIMATE &

ENERGY CAMPAIGN

GREENPEACE CANADA

Sven TeskeCLIMATE & ENERGY UNIT

GREENPEACE INTERNATIONAL

reduction in energy related CO2 emissions by 2050 might not beenough to keep the global mean temperature rise below +2°C. An even greater reduction may be needed if runaway climate changeis to be avoided.

The advanced Energy [R]evolution scenario has changed fiveparameters compared to the basic version. These mean that theeconomic lifetime of coal power stations has been reduced from 40 to20 years, the growth rate of renewables has taken the advancedprojections of the renewable industry into account, the use of electricdrives in the transport sector will take off ten years earlier, theexpansion of smart grids will happen quicker, and last but not least,the expansion of fossil fuel based energy will stop after 2015.

A drastic reduction in CO2 levels and a share of over 80% renewablesin the world energy supply are both possible goals by 2050. Of coursethis will be a technical challenge, but the main obstacle is political. Weneed to kick start the Energy [R]evolution with long lasting reliablepolicy decisions within the next few years. It took more than a decade to make politicians aware of the climatecrisis; we do not have another decade to agree on the changes neededin the energy sector. Greenpeace and the renewables industry presentthe Energy [R]evolution scenario as a practical but ambitious blueprint.For the sake of a sound environment, political stability and thrivingeconomies, now is the time to commit to a truly secure and sustainableenergy future – a future built on energy efficiency and renewableenergy, economic development and the creation of millions of new jobsfor the next generation.

image NORTH HOYLE WIND FARM, UK’S FIRST WIND FARM IN THE IRISHSEA WHICH WILL SUPPLY 50,000 HOMESWITH POWER.

© ANTHONY UPTON 2003

9

a global recession and a financial crisis and is a testament to theinherent attractiveness of renewable technology. In 2009 the total level of annual investment in clean energy was$145 billion, only a 6.5% drop from the record previous year, whilethe global wind power market grew by an annual 41.5%. In the USalone, the wind industry grew by nearly 40%. The renewable energyindustry now employs around two million people worldwide and hasbecome a major feature of national industrial development plans. Inthe US, wind already employs more people than coal. Meanwhile, theeconomics of renewables are expected to further improve as theydevelop technically, and as the price of fossil fuels continues to riseand as their saving of carbon dioxide emissions is given a monetaryvalue. These cost comparisons, already favorable to renewables, don’teven account for the massive externalized costs of fossil fuels such asthe oil spill in the Gulf of Mexico.

Despite the small drop in fossil fuel emissions in the industrializedworld as a result of the economic crisis, globally the level of energyrelated carbon dioxide continues to grow. This means that a recoveredeconomy will result in increasing CO2 emissions once again, furthercontributing to the greenhouse gases which threaten our planet. Ashift in energy policy is needed so that a growing economy andreduced CO2 emissions can go hand in hand. The Energy [R]evolutionanalysis shows how this is possible.

Although the Copenhagen climate change conference at the end of 2009 was a huge disappointment, it should not lead to a feelingthat nothing can happen. A change in energy policy has to beconnected to a change of climate policy. The United Nations(UNFCCC) climate talks therefore still remain central to the survivalof our planet and a global regime for CO2 reduction. Placing a priceon carbon, as well as a long term agreement on CO2 reduction, areboth of vital importance for the uptake of renewables and energyefficiency. The achievement of a new ‘fair, ambitious and legallybinding’ (FAB) deal relies fundamentally on legally binding emissionsreduction obligations, on common guidelines for accounting rules, ona compliance regime and on agreed carbon trading mechanisms.

energy [r]evolution 2010

This is the third edition of the global Energy [R]evolution scenariosince the first one was published in January 2007, each analysisdeeper than the last. In the second edition we introduced specificresearch for the transport sector and an investigation of the pathwayto future investment in renewable energies. Since then we havepublished country-specific scenarios for over 30 countries and regions,added a study of the employment implications of the scenarios and adetailed examination of how the grid network needs to be improvedand adapted.

This new edition has broken fresh ground again. The 2010 Energy[R]evolution not only includes the financial analysis and employmentcalculations in parallel with the basic projections, we have also added a second, more ambitious Energy [R]evolutionscenario. This was considered vital because rapid improvements in climate science made it clear during 2009 that a global 50%

10


canada: energy superpower or energy [r]evolution?

Canada is the fifth-largest producer of energy on the planet, with an unparalleled wealth of both renewable and non-renewableenergy resources, including the second-largest proven reserve of oil inthe world.1

After years of conflict over climate policy and the development ofenergy infrastructure, there is now wide-spread agreement amongstthe key policy players that Canada needs a national energy strategythat is based on a vision of what our energy future looks like, andimplemented through a coherent set of policies at the federal,provincial and even municipal levels to guide the public and theprivate investment required to realize this future.

At present, there are two clear visions of what this energy strategyshould look like: Energy Superpower, or Energy [R]evolution. Thechoice between them needs to be made through an informed publicdebate rather than through back-room lobbying, as Canada’s energystrategy will be a defining feature of our nation’s economic, social,and environmental future.

In support of the first vision, the Harper government and the corporateenergy lobby would use our abundant reserves of oil, gas, coal and

uranium to transform Canada into an “Energy Superpower.” In thisvision, Canada’s economic future and global stature would be anchoredin what Prime Minister Harper has called “an ocean of oil-soakedsand.”2 The rapid expansion of tar sands operations in the boreal forestof northern Alberta are at the heart of this strategy, but it also includesthe expansion of the oil and gas frontier into the Arctic, the seas off theBritish Columbia and Atlantic coasts, and the waters of the Great Lakesand the St. Laurence River as well. It also includes sale of Canada’suranium resources and nuclear technology. The federal and Albertagovernments are aggressively supporting this vision through publicsubsidies and policy reforms, and oil companies are investing billions ofdollars into making it a reality. Even in Quebec, which of all theprovinces could most readily become fossil energy–free, the governmentis now seriously considering embarking on oil and gas extraction.

Yet the International Energy Agency’s own analysis shows that theseresources are only needed in, and indeed would contribute to creating,a world suffering from “massive climatic change and irreparableharm to the planet.”

executive summary

“AT THE CORE OF THE ENERGY [R]EVOLUTION WILL BE A CHANGE IN THE WAY THAT ENERGY IS PRODUCED, DISTRIBUTED AND CONSUMED.”

© GREENPEACE/MARKEL REDONDO

image THE PS10 CONCENTRATING SOLAR THERMAL POWER PLANT IN SEVILLA, SPAIN. THE 11 MEGAWATT SOLAR POWER TOWER PRODUCES ELECTRICITY WITH 624 LARGE MOVABLE MIRRORSCALLED HELIOSTATS. THE SOLAR RADIATION, MIRROR DESIGN PLANT IS CAPABLE OF PRODUCING 23 GWH OF ELECTRICITY WHICH IS ENOUGH TO SUPPLY POWER TO A POPULATION OF 10,000.

references1 NATURAL RESOURCES CANADA, ECONOMIC SCAN OF CANADA’S ENERGY SECTOR, 2008.2 STEPHEN HARPER, “ADDRESS BY THE PRIME MINISTER AT THE CANADA-UK CHAMBER OFCOMMERCE,” 14 JULY 2006, AVAILABLE AT <HTTP://PM.GC.CA/ENG/MEDIA.ASP?ID=1247>.

11

To become this kind of an Energy Superpower would come at the cost ofecological destruction on a scale that would undermine the ability of futuregenerations to enjoy a decent quality of life. If we wish to protect the planetfor our children, the only alternative is to change our relationship to energy.

Greenpeace has proposed a global Energy [R]evolution scenario,developed for Greenpeace and the European Renewable EnergyCouncil,3 that provides a practical blueprint for the world’s renewableenergy future. It shows how we can phase out fossil fuels, cut CO2

emissions while ensuring energy security, bring energy to an extra twobillion people who currently have no access to electricity, and createmillions of green-collar jobs.

The Greenpeace Advanced Energy [R]evolution scenario shows how,by 2050, renewable energy sources could provide 96% of theelectricity produced in Canada and 92% of our total heating demand,accounting for 74% of our overall primary energy demand. Theblueprint would create about 72,000 jobs in the renewables sectoralone, by 2030. The total fuel cost savings in the Advanced Energy[R]evolution scenario described could reach a total of $228 billion, or$5.3 billion per year.

Canada can join the Energy [R]evolution by promoting efficiency andrenewable energy, and phasing out energy derived from coal, nuclear,and oil. The sustainable future of the planet will not be brought aboutby further subsidizing of dirty and finite fossil fuels, but by investmentin people and local communities who can install and maintainrenewable energy sources.

The Energy [R]evolution has already started in Canada. The provincesof British Columbia and Quebec have already put a price on carbon.The Green Energy Act in Ontario has established a system of feed-intariffs and improved grid access for renewable energy along the linescalled for in this report. In the first six months of 2010, commitmentswere made to over $18 billion of renewable energy projects. By 2015,these 800 projects will be generating over 7,750 megawatts of powerand 16 terawatt hours of electricity annually, or roughly 11% ofcurrent electricity consumption in Ontario.

a safe level of warming?

Climate change, caused by rising global temperatures, is the mostsignificant environmental challenge facing the world at the beginning ofthe 21st century. It has major implications for the world’s social andeconomic stability, its natural resources and in particular, the way weproduce our energy. The December 2009 Copenhagen Accord, aims tokeep the global average temperature increase below 2°C, and thenconsider a 1.5°C limit by 2015. However, the reduction pledgessubmitted by various parties to the United Nations FrameworkConvention on Climate Change (UNFCCC), in the first half of 2010 arelikely to lead to a world with global emissions of between 47.9 and 53.6gigatonnes of carbon dioxide equivalent per year by 2020. This is about10–20% higher than today’s levels. The greenhouse gas reductioncommitment for 2020 submitted by Canada to the Copenhagen Accordwas even weaker than its previous greenhouse gas reductioncommitment, and wouldn’t even achieve the level committed to byCanada for the 2008–2012 period, under the Kyoto Protocol.

In the worst case, the Copenhagen Accord pledges could even permitemission allowances to exceed a “business as usual” projection. Inorder to avoid the most catastrophic impacts of climate change, theglobal temperature increase must be kept as far below 2°C aspossible. This is still possible, but time is running out. To stay withinthis limit, global greenhouse gas emissions will need to peak by 2015and decline rapidly after that, reaching as close to zero as possible bythe middle of the 21st century.

Keeping the global temperature increase to 2°C is often referred to asa “safe level” of warming, but this does not reflect the reality of thelatest science. This science shows that a warming of 2°C above pre-industrial levels would pose unacceptable risks to many of the world’skey natural and human systems. Even with a warming of 1.5°C, manyregions of the world are expected to experience increases in drought,heat waves and floods, along with other adverse impacts such asincreased water stress for up to 1.7 billion people, wildfire frequencyand flood risks. Neither does staying below 2°C in warming rule outlarge-scale disasters such as melting ice sheets. Partial de-glaciationof the Greenland and West Antarctic ice sheets could even occur fromadditional warming within a range of 0.8–3.8°C above current levels.6

climate change and security of supply

Spurred by recent rapidly fluctuating oil prices, security of supply is nowat the top of the energy policy agenda. One reason for price fluctuationsis that all proven resources of oil, gas and coal are becoming scarcer andmore expensive to produce. So-called “non-conventional” resources suchas the Canadian tar sands have become economical, with devastatingconsequences for the environment. The days of “cheap oil and gas” arecoming to an end. Uranium, the fuel for nuclear power, is also a finiteresource. This report demonstrates that, by contrast, the global technicalpotential for renewable energy can supply about six times more powerthan the world currently consumes—forever.

Renewable energy technologies vary widely in their technical andeconomic maturity, but a range of sources offers increasingly attractiveoptions. These include wind, photovoltaics (PV), solar thermal,geothermal, ocean, sustainable biomass and low-impact hydroelectricpower. They produce little or no greenhouse gases, and rely on virtuallyinexhaustible natural elements for their “fuel.” Some of thesetechnologies are already competitive. The wind power industry, forexample, continued its explosive growth in the face of a global recessionand a financial crisis in 2008 and 2009 and is a testament to theinherent attractiveness of renewable technology.

references3 THE NATIONAL REPORT FOR CANADA HEREIN IS A COMPANION TO THE GLOBAL REPORTENERGY [R]EVOLUTION: A SUSTAINABLE WORLD ENERGY OUTLOOK (EREC/GREENPEACE2010), WHICH CONTAINS ADDITIONAL DETAIL ON SCENARIO ASSUMPTIONS, DATA ANDMODELING. IT IS AVAILABLE AT <HTTP://WWW.ENERGYBLUEPRINT.INFO>.4 JOERI ROGELJ ET AL., COPENHAGEN ACCORD PLEDGES ARE PALTRY, NATURE 464:1126–1128, 22 APRIL 2010.5 W. L. HARE, A SAFE LANDING FOR THE CLIMATE, STATE OF THE WORLD, WORLDWATCHINSTITUTE, 2009.6 JOEL B. SMITH ET AL., ASSESSING DANGEROUS CLIMATE CHANGE THROUGH AN UPDATE OFTHE INTERGOVERNMENTAL PANEL ON CLIMATE CHANGE (IPCC) “REASONS FOR CONCERN,”PROCEEDINGS OF THE NATIONAL ACADEMY OF SCIENCES, PUBLISHED ONLINE 26 FEBRUARY2009: <HTTP://WWW.PNAS.ORG/CONTENT/EARLY/2009/02/25/0812355106.FULL.PDF>.

© KATE DAVISON/GP

image WELDER WORKING AT VESTASWIND TURBINE FACTORY,CAMPBELLTOWN, SCOTLAND.

According to the United Nations Environment Program, and BloombergNew Energy Finance, global investment in sustainable energy was US$162 billion in 2009, and for the second year in a row, investments insustainable energy exceeded investments in new fossil capacity.7 Theglobal wind industry defied the economic downturn and saw its annualmarket grow by 41.5% over 2008, and total global wind power capacityincreased by 31.7% to 158 GW at the end of 2009.8 More grid-connected solar PV capacity was added worldwide than in the boomyear of 2008. And the economics of renewables will further improve asthey develop technically, as the price of fossil fuels continues to rise, andas carbon pricing systems become more widespread.

At the same time, there is enormous potential for reducing ourconsumption of energy and still continuing to provide the same levelof energy services. Energy efficiency measures can substantiallyreduce demand across industry, homes, business and services.9

Viewed against these positive attractions, nuclear energy is a relativelyminor industry with major problems. The average age of operatingcommercial nuclear reactors is 23 years, so more power stations arebeing shut down than started. In 2009, world nuclear production hadfallen by 4% compared to 2006,10 and the number of operating reactorsas of January 2010 was 436, eight less than at the historical peak of2002. Although nuclear power produces little carbon dioxide, there aremultiple 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, theunsolved problem of nuclear waste, and the potential hazard of a seriousaccident. The nuclear option is therefore rejected in this analysis.

the energy [r]evolution

The climate change imperative demands nothing short of an Energy[R]evolution, a transformation that has already started as renewableenergy markets continue to grow. In the first global edition of theEnergy [R]evolution, published in January 2007, we projected a global installed renewable capacity of 156 GW by2010. At the end of 2009, 158 GW has been installed. More needs tobe done, however. At the core of this revolution will be a change in theway that energy is produced, distributed and consumed. The five keyprinciples behind this shift will be to:

the five key principles behind this shift will be to:

• Implement renewable solutions, especially through decentralizedenergy systems;

• Respect the natural limits of the environment;

• Phase out dirty, unsustainable energy sources;

• Create greater equity in the use of resources; and

• Decouple economic growth from the consumption of fossil fuels.

Decentralized energy systems, where power and heat are produced closeto the point of final use, will avoid the current waste of energy during

conversion and distribution. Investments in “climate infrastructure”—such as “smart” interactive grids, as well as super grids to transportlarge quantities of offshore wind and concentrating solar power—areessential. Building up clusters of renewable micro-grids, especially forpeople living in remote areas, will be a central tool in providingsustainable electricity to the almost two billion people around the worldfor whom access to electricity is presently denied.

greenhouse development rights framework

Although the Energy Revolution envisages a clear technological pathway, itis only likely to be turned into reality if its corresponding investment costsare shared fairly under some kind of global climate regime. To demonstrateone such possibility, we have utilized the Greenhouse Development RightsFramework, designed by EcoEquity and the Stockholm EnvironmentInstitute, as a way of evening up the unequal ability of different countriesto respond to the climate crisis in their energy polices.

The Greenhouse Development Rights Framework (GDR) calculatesnational shares of global greenhouse gas obligations, based on acombination of responsibility (contribution to climate change) andcapacity (ability to pay). Crucially, GDR takes inequality within countriesinto account and calculates national obligations on the basis of theestimated capacity and responsibility of individuals. Individuals withincomes below a “development threshold”—specified in the default caseas $7,500 per capita annual income, adjusted for purchasing powerparity (PPP)—are exempted from climate-related obligations. Individualswith incomes above that level are expected to contribute to the costs ofglobal climate policy in proportion to their capacity (amount of incomeover the threshold) and responsibility (cumulative CO2 emissions).

The result of these calculations is that rich countries like Canada, whichis also responsible for a disproportionately large share of globalgreenhouse gas emissions, will contribute more toward the costs ofimplementing global climate policies, such as increasing the proportionof renewables, than a country like Mexico. Based on a “responsibilityand capacity indicator” (RCI), Canada, accounting for 3.1% of theworld’s responsibility for climate change, would thus be responsible forfunding 2.9% of the required global emissions reductions.

The GDR therefore represents a good mechanism for helpingdeveloping countries to leapfrog into a sustainable energy supply, withthe help of industrialized countries, while maintaining economic growthand the need to satisfy their growing energy needs. Greenpeace hastaken this concept on board as a means of achieving equity within theclimate debate and as a practical solution to kick-starting therenewable energy market in developing countries.

12


references7 UNITED NATIONS ENVIRONMENT PROGRAMME, AND BLOOMBERG NEW ENERGY FINANCE,GLOBAL TRENDS IN SUSTAINABLE ENERGY INVESTMENT 2010: ANALYSIS OF TRENDS AND ISSUES IN THE FINANCING OF RENEWABLE ENERGY AND ENERGYEFFICIENCY, 2010.8 SAWYER, A. ZERVOS, GLOBAL WIND 2009 REPORT, GLOBAL WIND ENERGY COUNCIL,MARCH 2010.9 POLICY RECOMMENDATIONS ON ENERGY EFFICIENCY ARE PRESENTED IN CHAPTER 9,BUT FOR A MORE DETAILED DISCUSSION SEE CHAPTER 10 OF THE GLOBAL 2010 ENERGY[R]EVOLUTION REPORT, ENERGY [R]EVOLUTION: A SUSTAINABLE WORLD ENERGYOUTLOOK (EREC/GREENPEACE), AVAILABLE AT <WWW.ENERGYBLUEPRINT.INFO> 10 BP, STATISTICAL REVIEW OF WORLD ENERGY 2010.

13

© GP/ALBERTO CESAR ARAUJOimage THOUSANDS OF FISH DIE AT THE

DRY RIVER BED OF MANAQUIRI LAKE,150 KILOMETERS FROM AMAZONASSTATE CAPITOL MANAUS, BRAZIL.

methodology and assumptions

Three scenarios, up to the year 2050, are outlined in this report: aReference scenario;, an Energy [R]evolution (E[R]) scenario, with atarget of reducing Canadian energy-related CO2 emissions by 86% fromtheir 1990 levels (as part of 50% global reduction); and an AdvancedEnergy [R]evolution scenario, which envisages a fall of 94% in Canadianenergy-related CO2 by 2050 (as part of an 82% global reduction).

The Reference scenario is based on the reference scenario in theInternational Energy Agency’s (IEA’s) World Energy Outlook 2009(WEO 2009) analysis, extrapolated forward from 2030. Compared tothe previous (2007) IEA projection, WEO 2009 assumes a slightly loweraverage annual growth rate for world gross domestic product (GDP) of3.1%, instead of 3.6%, over the period 2007–2030. At the same time,it expects final energy consumption in 2030 to be 6% lower than in the2007 report. China and India are expected to grow faster than otherregions, followed by the Developing Asia group of countries, Africa, andthe Transition Economies countries (mainly the former Soviet Union).The OECD share of global purchasing power parity (PPP)–adjustedGDP will decrease from 55% in 2007 to 29% by 2050.

The Energy [R]evolution scenario has a key target of the reduction ofworldwide carbon dioxide emissions down to a level of around 10gigatonnes per year by 2050. A second objective is the globalphasing-out of nuclear energy. To achieve these goals, the scenario ischaracterized by significant efforts to fully exploit the large potentialfor energy efficiency. At the same time, all cost-effective renewableenergy sources are used for heat and electricity generation, as well asthe production of sustainable biofuels. The general frameworkparameters for population and GDP growth remain unchanged fromthe Reference scenario.

The Advanced Energy [R]evolution Scenario takes a much moreradical approach to the climate crisis facing the world. In order topull the emergency brake on global emissions, it therefore assumesmuch shorter technical lifetimes for coal-fired power plants—20years instead of 40 years. This reduces global CO2 emissions evenfaster and takes the latest evidence of greater climate sensitivity intoaccount. To fill the resulting gap, the annual growth rates ofrenewable energy sources, especially solar photovoltaics, wind andconcentrating solar power plants, have therefore been increased.

Apart from that, the Advanced scenario takes on board all thegeneral framework parameters of population and economic growthfrom the basic scenario, as well as most of the energy efficiencyroadmap. In the transport sector, however, there is a faster uptake ofefficient combustion vehicles and—after 2025—a larger share ofelectric vehicles.

Within the heating sector, there is a faster expansion of combined heatand power (CHP) in the industry sector, more electricity for processheat, and a faster growth of solar and geothermal heating systems.Combined with a larger share of electric drives in the transport sector,this results in a higher overall demand for electric power in Canada.Even so, the overall electricity demand in the advanced Energy[R]evolution scenario is still 27% lower than in the Reference scenario.

In the Advanced scenario, the latest market development projections ofthe renewable industry11 have been calculated for all sectors (see section5). The speedier uptake of electric vehicles, combined with the fasterimplementation of smart grids and expanding super grids (about tenyears ahead of the Energy [R]evolution scenario) allows a higher shareof fluctuating renewable power generation (photovoltaic and wind). Thethreshold of a 40% proportion of renewables in global primary energysupply is therefore passed just after 2030 (also ten years ahead). Bycontrast, the global quantity of biomass and large hydro power remainthe same in both Energy [R]evolution scenarios, for sustainabilityreasons, although the share of biomass and hydro power are moderatelyhigher in the Canadian Advanced scenario relative to the basic Energy[R]evolution scenario.

towards a renewable future in canada

In 2007, renewable energy accounted for 15% of Canada’s primaryenergy demand. The renewable share of electricity generation is 59%, dueprimarily to the large share of hydroelectricity, while the contribution toheat supply is around 11%. About 76% of the primary energy supplytoday still comes from fossil fuels and 9% from nuclear power. BothEnergy [R]evolution scenarios describe development pathways which turnthe present situation into a sustainable energy supply, with the Advancedscenario achieving the urgently needed CO2 reduction target more than adecade earlier than the Energy [R]evolution scenario.

results of implementing the advanced energy[r]evolution scenario

1.Efficiency—Final energy demand in Canada decreases by 38% fromthe current (2007) 8,583 petajoules per annum (PJ/a) to 5,362 PJ/ain 2050. By contrast, under the Reference scenario, demand grows26% to 10,830 PJ/a. Globally, final energy demand grows modestly inthe Advanced scenario, but much less than in the Reference scenario.This reduction in energy demand is a crucial prerequisite forrenewable energy’s achieving a significant share of the overall energysupply system, and for compensating for the phasing-out of nuclearenergy and reduced consumption of fossil fuels.

2.Electric transport—More electric drives are used in the transportsector, and hydrogen produced by electrolysis from excess renewableelectricity plays a much bigger role in the Advanced than in the E[R]scenario. By 2020, the final energy share of electric vehicles on theroad increases to 9% and by 2050 to 66%. More public transportsystems also use electricity, as well as there being a greater shift fromroad to rail in the transport of freight.

3.Combined Heat and Power (CHP)—The increased use of combinedheat and power (CHP) generation also improves the supply system’senergy conversion efficiency, increasingly using natural gas andsustainable biomass. In the long term, the decreasing demand for heatand the large potential for producing heat directly from renewableenergy sources limits the further expansion of CHP.

references11 PROF. ARTHOUROS ZERVOS, CHRISTINE LINS AND JOSCHE MUTH, RE-THINKING 2050: A100% RENEWABLE ENERGY VISION FOR THE EUROPEAN UNION, EUROPEAN RENEWABLEENERGY COUNCIL (EREC), APRIL 2010.

4. Renewable electricity—The electricity sector will pioneerrenewable energy. By 2050, about 96% of electricity will beproduced from renewable sources, with the bulk of this comingfrom hydro (78% of which already exists) and wind power. Asignificant share of the fluctuating power generation from windand solar photovoltaic will be used to supply electricity to vehiclebatteries and to produce hydrogen as a secondary fuel in transportand industry. By using load management strategies, excesselectricity generation will be reduced and more balancing powermade available.

5. Renewable heat—The renewable energy contribution to heat supplywill increase to 92% by 2050. Fossil fuels will be increasinglyreplaced by solar collectors, sustainable biomass, and geothermalheat. Geothermal heat pumps will play a growing part in industrialheat production.

6.Transportation efficiency—Efficiency in the transport sector will beachieved by a modal shift from road to rail and by using lighter,smaller vehicles. The production of biofuels is limited by theavailability of sustainable raw materials and dedicated primarily tostationary applications rather than liquid biofuels. Electric vehicles,powered by renewable energy sources, will make up an increasinglyimportant share of the vehicle fleet, from 2020 onwards.

7. Renewable primary energy—The contribution of renewables toCanada’s primary energy demand will be 74% by 2050, up from15% today.

8.Tar sands phase-out by 2030—Globally, the demand for oil in theAdvanced scenario drops by 26% by 2030, relative to current levels,and by 67% by 2050. This eliminates the market for high-cost, highlypolluting, unconventional oil from the Canadian tar sands.

To turn this scenario into reality, it will be important to invest inclimate infrastructure, such as public transit, district heating, andsmart grid systems, as well as in more research and development(R&D) in technologies for storage of electricity.

It is also important to highlight that in the Advanced Energy[R]evolution scenario, the remaining coal plants—the majority of whichare in China and India—will be replaced 20 years before the end oftheir technical lifetime. This means that in practice all coal power plantsbuilt between 2005 and 2020 will be replaced by renewable energysources from 2040 onwards. To support the building of capacity indeveloping countries, significant new public financing, especially fromindustrialized countries, will be needed. It is vital that specific fundingmechanisms are developed under the international climate negotiationswhich can assist the transfer of financial support to climate changemitigation, including technology transfer.

future costs

Increased renewable energy under the two Energy [R]evolutionscenarios slightly increases the cost of electricity, compared to theReference scenario, until 2030. However, the difference will be less than1.2 cents per kilowatt-hour (kWh). After 2030, electricity costs will be

lower under both Energy [R]evolution scenarios than in the Referencescenario. This is due to the lower CO2 intensity of electricity generationand to the related costs for emission allowances, as well as to bettereconomics of scale in the production of renewable power equipment.

In 2050, electricity costs will be 7 cents/kWh in the Advancedscenario; 7.2 cents/kWh in the Energy [R]evolution scenario; and10.2 cents/kWh in the Reference scenario. Under the Referencescenario, the unchecked growth in electricity demand, the increase infossil fuel prices, and the cost of CO2 emissions result in totalelectricity supply costs rising from $34.7 billion in 2007 to $86.5billion in 2050. The Energy [R]evolution scenarios not only reduceCanada’s CO2 emissions, but also help to stabilize energy costs andrelieve economic pressure on society. Increasing energy efficiency andshifting energy supply to renewables result in cumulative costs(2007–2050) for electricity supply that are 36% lower in theAdvanced scenario and 41% lower in the E[R] scenario. The highertotal costs in the Advanced compared to the E[R] scenario resultfrom greater electrification of the transport and heating sectors. It isassumed that average crude oil prices will increase from $110 perbarrel in 2008, to $147 per barrel in 2020, and continue to rise to$170 per barrel in 2050. Natural gas import prices are expected toincrease by a factor of four between 2008 and 2050, while coalprices will continue to rise, reaching $195 per tonne in 2050. A CO2

“price adder” is applied, which rises from $23 per tonne of CO2 in2020 to $57 per tonne in 2050.

future investment

The Advanced Energy [R]evolution scenario would require $399 billioninvestment in the electricity sector—about 25% higher than theReference scenario, at $319 billion. Under the Reference scenario,almost 30% of investment until 2050 will go towards fossil andnuclear fuels. Under the Advanced scenario, however, Canada shiftsclose to 90% of investment towards renewables and CHP; by 2050, thefossil fuel share of power-sector investment would be focused mainly oncombined heat and power and efficient gas-fired power plants. Theaverage annual investment in the power sector under the AdvancedEnergy [R]evolution scenario, between 2007 and 2030, would be about$9.3 billion. Because renewable energy has no fuel costs, however, thefuel cost savings in the Advanced Energy [R]evolution scenario until2050 total $228 billion, or $5.3 billion per year.

Under the Reference scenario, the average annual additional fuelcosts are higher than the additional investment requirements of theAdvanced Energy [R]evolution scenario. In fact, just the additionalcosts for coal from 2007 until the year 2050 are as high as $3billion, which is enough to compensate the entire investment inrenewable and cogeneration capacity required to implement theAdvanced scenario. These renewable energy sources would then go onto produce electricity without any further fuel costs beyond 2050,while the costs for coal and gas will continue to be a burden on theeconomy. Part of this money could be used to cover strandedinvestments in fossil power stations in developing countries.

14


“worldwide we would see more direct jobs created in theenergy sector if we shift to either of the energy [r]evolutionscenarios than if we continue business as usual.”

15

© PAUL LANGROCK/ZENIT/GPimage CONSTRUCTION OF THE OFFSHORE

WINDFARM AT MIDDELGRUNDEN NEARCOPENHAGEN, DENMARK.

future employment

Worldwide, we would see more direct jobs created in the energysector if we shifted to either of the Energy [R]evolution scenarios.

The Energy [R]evolution scenarios lead to more electricity sector jobsin Canada at every stage:

• By 2015, more than 67,000 jobs would be created in the renewablepower sector under the Advanced Energy [R]evolution scenario—29,000 more than the 38,000 in the Reference scenario. TheEnergy [R]evolution scenario would create 52,000 jobs in therenewable power industry by the same year.

• By 2030, the Advanced Energy [R]evolution scenario would createabout 72,000 jobs in the renewable power sector—24,000 morethan the 48,000 jobs in the Reference scenario. The Advancedscenario creates about 12,000 more new jobs in the entire powersector between 2015 and 2030, compared to the Referencescenario.

canada’s co2 emissions

Energy-related CO2 emissions in Canada will increase more than 10%under the Reference scenario, up to 2050, and are thus very farremoved from a sustainable development path. By contrast, under theAdvanced Energy [R]evolution scenario emissions will decrease from547 million tonnes in 2007 to 29 million tonnes in 2050—94%below 1990 levels. Annual per capita emissions will drop from 16.6tonnes to 0.7 tonnes in the same time period. In spite of phasing out

nuclear energy and a growth in electricity demand, CO2 emissions willdecrease enormously in the electricity sector. There will even be areduction in transportation-sector CO2 emissions, due to efficiencyimprovements, the increased use of electric vehicles powered byrenewable energy, and a dramatic expansion of public transport.

energy [r]evolution policy changes

To join the Energy [R]evolution and to avoid catastrophic climatechange, the following policies and actions must be implemented in theenergy sector:

1. Phase out all subsidies for fossil fuels and nuclear energy.

2. Internalize the external (social and environmental) costs of energyproduction through “cap and trade” emissions trading.

3. Implement strict efficiency standards for all energy-consumingappliances, buildings and vehicles.

4. Establish legally binding targets for renewable energy andcombined heat and power generation.

5. Guarantee priority grid access for renewable energy.

6. Provide defined and stable returns for investors; for example,through feed-in tariff programmes.

7. Implement better labelling to provide more energy andenvironment product information.

8. Increase research and development budgets for efficiency andrenewable energy.

figure 0.1: development of primary energy consumption in canada to 2050, under three scenarios(‘EFFICIENCY’ = REDUCTION COMPARED TO THE REFERENCE SCENARIO)

PJ/a 0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

REF E[R]

2007

adv E[R]

REF E[R]

2015

adv E[R]

REF E[R]

2020

adv E[R]

REF E[R]

2030

adv E[R]

REF E[R]

2040

adv E[R]

REF E[R]

2050

adv E[R]

•‘EFFICIENCY’

• OCEAN ENERGY

• GEOTHERMAL

• SOLAR

• BIOMASS

•WIND

• HYDRO

• NATURAL GAS

• OIL

• COAL

• NUCLEAR

1climate protection and energy policy

GLOBAL THE KYOTO PROTOCOLINTERNATIONAL ENERGY POLICY

RENEWABLE ENERGY TARGETSPOLICY CHANGES IN THE ENERGY SECTOR

“never before hashumanity been forcedto grapple with such an immenseenvironmental crisis.”GREENPEACE INTERNATIONALCLIMATE CAMPAIGN

16

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

“climate change has moved from being apredominantly physicalphenomenon to being a socialone” (hulme, 2009).”

climate p

rotectio

n|

CLIM

ATE C

HANGE E

FFECTS

1

Here is a summary of some likely effects if we allowcurrent trends to continue:

Likely effects of small to moderate warming

• Sea level rise due to melting glaciers and the thermal expansion ofthe oceans as global temperature increases. Massive releases ofgreenhouse 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, aswell as coastal flooding, erosion and wetland loss. Flooding will alsoseverely affect low-lying areas in developing countries such asBangladesh and South China.

• Natural systems, including glaciers, coral reefs, mangroves, alpineecosystems, boreal forests, tropical forests, prairie wetlands andnative grasslands will be severely threatened.

• Increased risk of species extinction and biodiversity loss.

The greatest impacts will be on poorer countries in sub-SaharanAfrica, South Asia, Southeast Asia, and Andean South America, aswell as small islands least able to protect themselves from increasingdroughts, rising sea levels, the spread of disease, and a decline inagricultural production.

Longer-term catastrophic effects

• Warming from rising emissions may trigger the irreversiblemeltdown of the Greenland ice sheet, adding up to seven metres ofglobal sea-level rise over several centuries.

• New evidence shows that the rate of ice discharge from parts of theAntarctic means that its ice sheet is also at risk of meltdown.

• The resultant slowing, shifting or shutting down of the Atlantic GulfStream current would have dramatic effects in Europe, and disruptthe global ocean circulation system.

• Large releases of methane from melting permafrost and from theoceans would lead to rapid increases of the gas in the atmosphereand to consequent warming.

image WANG WAN YI, AGE 76, ADJUSTS THE SUNLIGHTPOINT ON A SOLAR DEVICE USED TO BOIL HIS KETTLE.HE LIVES WITH HIS WIFE IN ONE ROOM CARVED OUT OF THE SANDSTONE, A TYPICAL DWELLING FOR LOCALPEOPLE IN THE REGION. DROUGHT IS ONE OF THE MOSTHARMFUL NATURAL HAZARDS IN NORTHWEST CHINA.CLIMATE CHANGE HAS A SIGNIFICANT IMPACT ONCHINA’S ENVIRONMENT AND ECONOMY.

© GP/JOHN NOVIS

17

The greenhouse effect is the process by which the atmosphere trapssome of the sun’s energy, warming the earth and moderating ourclimate. A human-driven increase in greenhouse gases has enhancedthis effect, artificially raising global temperatures and disrupting ourclimate. These greenhouse gases include, carbon dioxide (CO2),produced by burning fossil fuels and through deforestation; methane,which is released from agriculture, animals and landfill sites; andnitrous oxide, resulting from agricultural production plus a variety ofindustrial chemicals.

Every day we damage our climate by using fossil fuels (oil, coal andgas) for energy and transport. Over the coming decades, the resultingchanges are likely to destroy the livelihoods of millions of people,especially in the developing world, as well as ecosystems and species.We therefore need to significantly reduce our greenhouse gasemissions. This makes both environmental and economic sense.

According to the Intergovernmental Panel on Climate Change(IPCC), the United Nations forum for established scientific opinion,the world’s temperature is expected to increase over the next hundredyears by up to 6.4° Celsius (C) if no action is taken to reducegreenhouse gas emissions. This is much faster than anythingexperienced so far in human history. The goal of climate policy shouldbe to keep the global mean-temperature rise to less than 2°C abovepre-industrial levels. At a rise of more than 2°C rise, damage toecosystems and disruption to the climate system is expected toincrease dramatically. We have very little time left to change ourenergy sources to avoid this: global emissions will have to peak andstart to decline by 2015.

Climate change is already harming people and ecosystems. Its realitycan be seen in disintegrating polar ice, thawing permafrost, rising sealevels, and fatal heat waves. It is not only scientists who arewitnessing these changes. From the Inuit in the far north to islandersnear the Equator, people are already struggling with impactsconsistent with climate change. An average global warming of morethan 2°C threatens millions of people with an increased risk ofhunger, disease, flooding and water shortages. Never before hashumanity been forced to grapple with such an immense environmentalcrisis. If we do not take urgent and immediate action to protect theclimate, the damage could become irreversible. Avoiding such damagecan only happen through a rapid reduction in the emissions ofgreenhouse gases into the atmosphere.

18


1.1 the kyoto protocol

Recognising these threats, the signatories to the 1992 UN FrameworkConvention on Climate Change (UNFCCC) agreed to the KyotoProtocol in 1997. The Protocol finally entered into force in early2005 and its 165 member countries meet twice annually to negotiatefurther refinement and development of the agreement. Only one majorindustrialized nation, the United States, has not ratified Kyoto.

The Kyoto Protocol commits its signatories to reduce theirgreenhouse gas emissions by 5.2% from their 1990 level by thetarget period of 2008–2012. This has in turn resulted in the adoptionof a series of regional and national reduction targets. In the EuropeanUnion, for instance, the commitment is to an overall reduction of 8%.In order to help reach this target, the EU also agreed on a target toincrease its proportion of renewable energy, from 6% to 12% by2010. Canada agreed to cut its emissions by 6% relative to 1990levels, but emissions are now 24% higher than they were in 1990.

At present, the 193 members of UNFCCC are negotiating a newclimate change agreement that should enable all countries to continuecontributing to ambitious and fair emissions reductions.Unfortunately, the aim to reach such an agreement in Copenhagen atthe end of 2009 failed, and governments will continue negotiating in2010 and possibly beyond to reach a new legally binding deal. Suchan agreement will need to ensure that industrialized countries reducetheir emissions on average by at least 40% by 2020, compared totheir 1990 levels. They will further need to provide funding of at least$140 billion a year to developing countries to enable them to adaptto climate change, protect their forests and achieve their part of theenergy revolution. Developing countries need to reduce theirgreenhouse gas emissions by 15 to 30%, compared to their projectedgrowth by 2020.

This new “fair and binding” (FAB) deal will need to incorporate theKyoto Protocol’s architecture. This relies fundamentally on legallybinding emissions reduction obligations. To achieve these targets, carbonis turned into a commodity which can be traded. The aim is to encouragethe most economically efficient emissions reductions, in turn leveragingthe necessary investment in clean technology from the private sector todrive a revolution in energy supply.

After Copenhagen, governments need to increase their resolve toreduce emissions and invest even more in making the energyrevolution happen. Greenpeace believes that it is feasible to reach aFAB deal in Cancun at the end of this year, if there is sufficientpolitical will to conclude such an agreement. That political will seemsto be lacking at the moment. But even if a FAB deal cannot befinalised in Cancun, due to lack of ambition and commitment by somecountries, major parts could still be in place, specifically those relatedto long-term financing commitments, forest protection and an overalltarget for emissions reductions. The result would be that by the timeof the Environment and Development Summit in Brazil in 2012, wewould be celebrating an agreement that definitely keeps the world’stemperature well below two degrees of warming.

1.2 international energy policy

At present, renewable energy generators have to compete with oldnuclear and fossil fuel power stations, which produce electricity atmarginal cost because consumers and taxpayers have already paid theinterest and depreciation on the original investment. Political action isneeded to overcome these distortions and create a level playing fieldfor renewable energy technologies to compete.

At a time when governments around the world are in the process ofliberalising their electricity markets, the increasing competitiveness ofrenewable energy should lead to higher demand. Without politicalsupport, however, renewable energy remains at a disadvantage,marginalised by distortions in the world’s electricity markets created bydecades of massive financial, political and structural support toconventional technologies. Developing renewables will therefore requirestrong political and economic efforts, especially through laws thatguarantee stable tariffs over a period of up to 20 years. Renewableenergy will also contribute to sustainable economic growth, high-qualityjobs, technology development, global competitiveness, and industrialand research leadership.

1.3 renewable energy targets

In recent years, in order to reduce greenhouse emissions as well asincrease energy security, a growing number of countries haveestablished targets for renewable energy. These are either expressed interms of installed capacity or as a percentage of energy consumption.These targets have served as important catalysts for increasing theshare of renewable energy throughout the world.

A time period of just a few years is not long enough in the electricitysector, however, where the investment horizon can be up to 40 years.Renewable energy targets therefore need to involve short-, medium-and long-term steps and must be legally binding in order to beeffective. They should also be supported by incentive mechanisms suchas feed-in tariffs for renewable electricity generation. In order for theproportion of renewable energy to increase significantly, targets mustbe set in accordance with the local potential for each technology(wind, solar, sustainable biomass, etc.) and be complemented bypolicies that develop the skills and manufacturing bases to deliver theagreed-upon quantity.

In recent years. the wind and solar power industries have shown thatit is possible to maintain a growth rate of 30 to 35% in therenewables sector. In conjunction with the European PhotovoltaicIndustry Association,12 the European Solar Thermal Power IndustryAssociation,13 and the Global Wind Energy Council,14 the EuropeanRenewable Energy Council and Greenpeace have documented thedevelopment of those industries from 1990 onwards and outlined aprognosis for growth up to 2020 and 2040.

1

climate p

rotectio

n|

KYOTO P

ROTOCOL

references12 GREENPEACE, SOLAR GENERATION IV (C. AUBREY, ED.), SEPTEMBER 2009.13 GREENPEACE, CONCENTRATING SOLAR POWER GLOBAL OUTLOOK 09: WHY RENEWABLEENERGY IS HOT!, MAY 2009.14 GLOBAL WIND ENERGY COUNCIL, GLOBAL WIND ENERGY OUTLOOK 2008, OCTOBER 2008.

1.4 policy changes in the energy sector

Greenpeace and the renewables industry have a clearagenda for the policy changes which need to be made toencourage a shift to renewable sources.

The main demands are the following:

1. Phase out all subsidies for fossil fuels and nuclear energy.

2. Internalize external (social and environmental) costs through cap-and-trade emissions trading.

3. Mandate strict efficiency standards for all energy-consumingappliances, 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 examplethrough feed-in tariff payments.

7. Implement better labelling and disclosure mechanisms to providemore environmental product information.

8. Increase research and development budgets for renewable energyand energy efficiency

Conventional energy sources receive an estimated $250–300 billion15 insubsidies per year worldwide, resulting in heavily distorted markets.Subsidies artificially reduce the price of power, keep renewable energyout of the market place and prop up non-competitive technologies andfuels. Eliminating direct and indirect subsidies to fossil fuels andnuclear power would help move us toward a level playing field acrossthe energy sector. Renewable energy would not need special provisions ifmarkets factored in the cost of climate damage from greenhouse gaspollution. Subsidies to polluting technologies are perverse in that theyare economically as well as environmentally detrimental. Removingsubsidies from conventional electricity supply would not only savetaxpayers’ money, it would also dramatically reduce the need forrenewable energy support.

19

© GP/PETER CATON

image A PRAWN SEED FARM ONMAINLAND INDIA’S SUNDARBANS COASTLIES FLOODED AFTER CYCLONE AILA.INUNDATING AND DESTROYING NEARBYROADS AND HOUSES WITH SALT WATER.

1

climate p

rotectio

n|

DEM

ANDS F

OR T

HE E

NERGY S

ECTOR

references15 UNITED NATIONS DEVELOPMENT PROGRAMME, WORLD ENERGY ASSESSMENT: ENERGYAND THE CHALLENGE OF SUSTAINABILITY, 2000.

© GP/PETER CATON

© GP/STEVE MORGAN

© GP/PETER CATON

© GP/STEVE MORGAN

© GP/JOHN NOVIS

images 1. AN AERIAL VIEW OF PERMAFROST TUNDRA IN THE YAMAL PENINSULA. THEENTIRE REGION IS UNDER HEAVY THREAT FROM GLOBAL WARMING AS TEMPERATURESINCREASE AND RUSSIA’S ANCIENT PERMAFROST MELTS. 2. SOVARANI KOYAL LIVES INSATJELLIA ISLAND AND IS ONE OF THE MANY PEOPLE AFFECTED BY SEA LEVEL RISE:“NOWADAYS, HEAVY FLOODS ARE GOING ON HERE. THE WATER LEVEL IS INCREASING ANDTHE TEMPERATURE TOO. WE CANNOT LIVE HERE, THE HEAT IS BECOMING UNBEARABLE. WEHAVE RECEIVED A PLASTIC SHEET AND HAVE COVERED OUR HOME WITH IT. DURING THECOMING MONSOON WE SHALL WRAP OUR BODIES IN THE PLASTIC TO STAY DRY. WE HAVEONLY A FEW GOATS BUT WE DO NOT KNOW WHERE THEY ARE. WE ALSO HAVE TWO CHILDRENAND WE CANNOT MANAGE TO FEED THEM.” 3. WANG WAN YI, AGE 76, SITS INSIDE HIS HOMEWHERE HE LIVES WITH HIS WIFE IN ONE ROOM CARVED OUT OF THE SANDSTONE, A TYPICALDWELLING FOR LOCAL PEOPLE IN THE REGION. DROUGHT IS ONE OF THE MOST HARMFULNATURAL HAZARDS IN NORTHWEST CHINA. CLIMATE CHANGE HAS A SIGNIFICANT IMPACTON CHINA’S ENVIRONMENT AND ECONOMY. 4. INDIGENOUS NENETS PEOPLE WITH THEIRREINDEER. THE NENETS PEOPLE MOVE EVERY 3 OR 4 DAYS SO THAT THEIR HERDS DO NOTOVER GRAZE THE GROUND. THE ENTIRE REGION AND ITS INHABITANTS ARE UNDER HEAVYTHREAT FROM GLOBAL WARMING AS TEMPERATURES INCREASE AND RUSSIA’S ANCIENTPERMAFROST MELTS. 5. A BOY HOLDS HIS MOTHER’S HANDS WHILST IN A QUEUE FOREMERGENCY RELIEF SUPPLY. SCIENTISTS ESTIMATE THAT OVER 70,000 PEOPLE, LIVINGEFFECTIVELY ON THE FRONT LINE OF CLIMATE CHANGE, WILL BE DISPLACED FROM THESUNDARBANS DUE TO SEA LEVEL RISE BY THE YEAR 2030.

1

3

2

4 5

“if we do not take urgent andimmediate action to protectthe climate the damage couldbecome irreversible.”

implementing the energy [r]evolution

GLOBAL CANADIAN POLICY ISSUESFTSM SCHEME

GREENHOUSE DEVELOPMENT RIGHTS

20

“bridging the gap.”GREENPEACE INTERNATIONALCLIMATE CAMPAIGN

image G

EOTHER

MAL POW

ER PLAN

T, NORT

H ISLAN

D, NEW

ZEALAN

D. © JOE

GOUGH/

DREAMS

TIME2

references16 STEPHEN HARPER, ADDRESS BY THE PRIME MINISTER AT THE CANADA-UK CHAMBEROF COMMERCE, 14 JULY 2006, AVAILABLE AT <HTTP://PM.GC.CA/ENG/MEDIA.ASP?ID=1247>. 17 HSBC GLOBAL RESEARCH, “A CLIMATE FOR RECOVERY: THE COLOUR OF STIMULUS GOESGREEN”, 25 FEBRUARY 2009. SEE ALSO JON STRAND AND MICHAEL TOMAN, GREENSTIMULUS, ECONOMIC RECOVERY, AND LONG-TERM SUSTAINABLE DEVELOPMENT, POLICYRESEARCH WORKING PAPER 5163 (THE WORLD BANK, JANUARY 2010).18 GOVERNMENT OF CANADA, “FIRST STEPS TAKEN TOWARDS MADE-IN-CANADAAPPROACH,” NEWS RELEASE, 13 APRIL 2006. 19 SEE 31 MARCH 2010 ANNOUNCEMENT BY GOVERNMENT OF CANADA, AVAILABLE AT<HTTP://OEE.NRCAN.GC.CA/RESIDENTIAL/PERSONAL/GRANTS.CFM?ATTR=4>. 20 GLORIA GALLOWAY, “TORY BUDGET ‘WALKS AWAY' FROM RENEWABLE ENERGY,ENVIRONMENTALIST SAYS.” GLOBE AND MAIL, 10 MARCH 2010. 21 MARTIN MITTELSTAEDT AND GLORIA GALLOWAY, “OTTAWA REVISES RULES OFENVIRONMENTAL REVIEW REGIME”, GLOBE AND MAIL, 31 MARCH 2010. 22 INTERNATIONAL ENERGY AGENCY, ENERGY POLICIES OF IEA COUNTRIES: CANADA 2009REVIEW, 2010, PP. 9, 237.23 CANADA’S SUBMISSION TO THE UNFCCC OF ITS QUANTIFIED ECONOMY-WIDE EMISSIONSTARGET, ONLINE AT <HTTP://WWW.CLIMATECHANGE.GC.CA/CDP-COP/DEFAULT.ASP?LANG=EN&N=C4BD2547-1#P4>. 24 ENVIRONMENT CANADA, “CANADA LISTS EMISSIONS TARGET UNDER THE COPENHAGENACCORD” NEWS RELEASE, 1 FEBRUARY 2010. 25 ENVIRONMENT CANADA, NATIONAL INVENTORY REPORT 1990–2008, APRIL 2010.

implem

entin

g th

e energ

y [r]evolutio

n|

CANADIA

N P

OLIC

Y IS

SUES

2

The Harper government’s Energy Superpower ambition has alsoshaped its approach to Canada’s international climate commitmentsand its positions in the negotiations over a new global climate deal.

Canada has effectively reneged on its commitments under the KyotoProtocol. To be fair, successive federal governments have failed tobring in measures to significantly cut greenhouse gas emissions,opting instead for voluntary policies and for subsidies rather thanmandatory carbon pricing and regulatory initiatives such as tougherenergy efficiency rules for buildings, equipment and vehicles, and forsubsidizing the tar sands. But the Harper government is not onlyfailing to pursue greenhouse gas reduction measures, it is alsorefusing to use the flexibility mechanisms available to it under theProtocol to address this shortfall. Canada has also been widelyviewed as playing a negative role in the negotiations, earning more“Fossil of the Day” awards from the Climate Action Network thanany other country for the last several years.

Canada was the only country in the world to lower its sights whensubmitting its emissions reduction pledge under the Copenhagen Accord.23

On 30 January 2010, Canadian Environment Minister Jim Prenticeannounced a new, weaker target for Canada’s greenhouse gas emissionsin 202024—17% cent below 2005 levels, by 2020. The government’sprevious target (adopted in 2006 as part of the government’s “Turningthe Corner” climate change plan) was a 20% reduction below 2006levels, by 2020. Not only was the new target weaker, it effectively rejectedCanada’s Kyoto Protocol target. The current target of the Harpergovernment for 2020 is 2.5% above the 1990 level, whereas the Kyototarget for 2008–2012 was 6% below the 1990 level.

Greenhouse gas emissions are typically referenced to 1990, which is theemissions base year used by the Kyoto Protocol. Thus, a 17% reductionfrom the 2005 level by 2020, is 2.5% above 1990 levels. The previoustarget (a 20% reduction from the 2006 level, by 2020) was 3% below1990 levels. Canadian greenhouse gas emissions were 731 milliontonnes (megatonnes—Mt) in 2005; 718 Mt in 2006; 750 Mt in 2007;and 734 Mt in 2008 (the most recent year for which data areavailable).25 Canada’s 2008 emission level was 24% above the 1990level of 592 Mt, and about 30% above the Kyoto target of 558.4 Mt.

2.1 canadian policy issues

2.1.1 canada: an energy superpower?

The American Recovery and Successive Canadian governments havebeen criticized for inaction on the climate change file. The truth isthat they have been very active. This activity simply hasn’t beenfocused on reducing greenhouse gas emissions.

To grasp the essence of contemporary Canadian climate policy, oneneed only turn to Stephen Harper’s first speech as Prime Minister tobusiness leaders outside of Canada. Speaking to a United Kingdomaudience in July 2006, he boldly announced his intention to buildCanada into an “energy superpower.”

Canada, he said, was already the fifth-largest producer of energy inthe world, on the strength of its production of oil, gas, uranium andhydroelectricity. But this was “only the beginning”:

“An ocean of oil-soaked sand lies under the muskeg of northernAlberta—my home province. The oil sands are the second largest oildeposit in the world, bigger than Iraq, Iran or Russia; exceeded onlyby Saudi Arabia. Digging the bitumen out of the ground, squeezingout the oil and converting it in into synthetic crude is a monumentalchallenge. It requires vast amounts of capital, Brobdingnagiantechnology, and an army of skilled workers. In short, it is anenterprise of epic proportions, akin to the building of the pyramids orChina’s Great Wall. Only bigger.” 16

The Energy Superpower vision he laid out in that speech—of aneconomic future for the nation rooted in the rapid exploitation of thetar sands, the expansion of the oil and gas frontier in the Arctic, andthe sale of nuclear technology and fuel—has been the key driver ofclimate policy in Canada ever since.

It shaped the government’s response to the 2008 economic crisis. InCanada, only eight per cent of the economic stimulus package wasdedicated to “green” measures, a level well below the comparable greenshare of stimulus packages in the US (12%), China (38%), the EuropeanUnion (59%), and South Korea (81%). And of that, the largest amount(41%) was for carbon capture and storage projects—a direct publicsubsidy for coal-fired and tar sands electricity, as well as for AtomicEnergy of Canada Limited (AECL), making Canada the only country tosubsidize nuclear power as part of its economic stimulus package.17

The steps for turning Canada into this “energy superpower” have begunto be realized in federal budgets, the government’s most significantannual policy statement. It was telling that the Harper government’s firstbudget saw the elimination of fifteen climate-related programmes.18 Andin its 2010 budget, it eliminated the principal federal programs forsupporting energy efficiency19 and renewable energy,20 while putting inplace new measures to fast-track approvals for fossil fuel and nuclearinfrastructure.21 And the International Energy Agency’s 2009 countryreview found that even though Canada is of one of the highest emittersof greenhouse gases per capita in the world, and has a higher energyintensity than any other IEA country, the largest part of governmentresearch and development spending is for fossil fuels (27%) and nuclearpower (38%), while energy efficiency (14%) and renewable energy(11%) are short-changed.22

21

“the debate over a national energy strategy holds the key towhat kind of an ‘energy superpower’ canada will become.”

22


To put these numbers in perspective, Greenpeace and other environmentalgroups have called on Canada to adopt a science-based emissionsreduction target of at least 25% below 1990 levels by the year 2020.

Even the government’s new weak climate target will not be achievedwithout significant new measures,26 and the government’s ownassessment shows that there is no net reduction in greenhouse gasemissions expected from federal action in the 2009–2012 period.27

This combination of Canada’s poor performance on reducing emissionsand its weak policy resulted in a last-place finish in the 2009 G8 ClimateScorecard produced jointly by the conservation organization WWF andthe global insurance firm Allianz. Similarly, in a survey of climate policyin 57 major countries released during the Copenhagen climate summit,Canada finished second-last (ahead of Saudi Arabia).28

2.1.2 a superpower without sovereignty?

In 2006, the newly-elected Harper government turned its back onCanada’s Kyoto commitments on the grounds that the country neededa “made in Canada” approach to climate change. In 2007, theHarper government brought forward the “Turning the Corner” plan toreduce greenhouse gases, which was assessed in Energy [R]evolution:A Sustainable Canada Energy Outlook.29

These proposals for a cap-and-trade system and regulatory measures,which were never implemented, have since been officially abandonedin favour of harmonizing with US climate policy.30 The unprecedenteddegree of integration—under US leadership—that is being proposedwas made clear in a 1 February 2010 speech by federal EnvironmentMinister Jim Prentice:

“We have adjusted our previous target to ensure that it matchesexactly with those just inscribed by the United States and we haveconsistently said from the outset that we must harmonize our climatechange strategy with that of our greatest trading partner because ofthe degree of economic integration between our two countries.... Ourdetermination to harmonize our climate change policy with that of theUnited States also extends beyond greenhouse gas emission targets:we need to proceed even further in aligning our regulations…[W]ewill only adopt a cap-and-trade regime if the United States signalsthat it wants to do the same. Our position on harmonization appliesequally to regulation… Canada can go down either road—cap-and-trade or regulation—but we will go down neither road alone.” 31

In that same speech, Prentice reiterated the government’s commitmentto defending the expansion of the tar sands as a key element of itsstrategy for becoming a “clean energy superpower,” yet the rhetoric onthe need to clean up the tar sands (Minister Prentice said “let me beperfectly clear, the oil sands must be developed in an environmentallyresponsible manner and the Government of Canada will ensure that oilsands development lives up to our stated objective to be a ‘clean energysuperpower’”) was not matched by any requirements to do so. To hiscredit, a leaked Finance Ministry memo32 shows that Minister Prenticesupported the phase-out of subsidies to the oil and gas sector as a wayto make the “clean” part of “clean energy superpower” more credible,yet this is not being acted on by the government.

Nor, contrary to the emphasis on harmonization, is the Canadianfederal government matching the efforts of the United States on energyefficiency and renewable energy. The US federal government is investingeight times more, per person, in renewable energy, energy efficiency andpublic transit combined than is Canada’s federal government. The gap iseven larger when it comes to investments in green energy. In 2009,there was a 14:1 per capita ratio between the United States andCanada for investments in renewable energy and this ratio is set toclimb to nearly 18:1 in 2010.33

Furthermore, a made-in-Washington strategy will not be the bestsuited for Canada. In the United States, coal-fired electricity is aprimary source of greenhouse gas emissions, while domestic oilproduction is declining. In Canada, on the other hand, coal-firedelectricity is a relatively small and declining portion of the systemmix while the upstream oil and gas sector is growing rapidly. So whileit may make sense to have common regulations for vehicle fuelefficiency (where Canada has recently been forced to raise its aim tomatch that of the United States), the differences in the energy mixwill require different policy solutions.

The strategy of waiting for the United States to pass legislation is,however, supported by the oil industry.34 So is designing a nationalenergy strategy whose stated guiding principles include to “advancethe primacy of the Canada-United States energy relationship.”35

Indeed, it is the debate over a national energy strategy—which is nowbeing called for by the oil and gas industry, the renewable energyindustry and environmentalists—which holds the key to what kind ofan “energy superpower” Canada will become: a nation seeking toexport increasingly carbon-intensive oil into a world market that hasmoved on to electric vehicles powered by green grids, or a leader inthe transition to a green energy system.

2

implem

entin

g th

e energ

y [r]evolutio

n|

CANADIA

N P

OLIC

Y IS

SUES

references26 FOR ECONOMIC MODELING OF THE POLICY MEASURES REQUIRED TO ACHIEVE THEGOVERNMENT’S OWN TARGET AS WELL AS A MORE AGGRESSIVE, SCIENCE-BASED TARGET,SEE: MATTHEW BRAMLEY, PIERRE SADIK AND DALE MARSHALL, CLIMATE LEADERSHIP,ECONOMIC PROSPERITY: FINAL REPORT ON AN ECONOMIC STUDY OF GREENHOUSE GASTARGETS AND POLICIES FOR CANADA, PEMBINA INSTITUTE AND DAVID SUZUKIFOUNDATION, 2009.27 ENVIRONMENT CANADA, A CLIMATE CHANGE PLAN FOR THE PURPOSES OF THE KYOTOPROTOCOL IMPLEMENTATION ACT, GOVERNMENT OF CANADA: MAY 2010, P. 34.28 GERMAN WATCH AND CAN-EUROPE, CLIMATE CHANGE PERFORMANCE INDEX 2010,(DECEMBER 2009). 29 EUROPEAN RENEWABLE ENERGY COUNCIL, GREENPEACE, ENERGY [R]EVOLUTION: ASUSTAINABLE CANADA ENERGY OUTLOOK, GREENPEACE CANADA, MAY 2009. 30 SEE “CANADA’S ACTION ON CLIMATE CHANGE,” AVAILABLE AT<HTTP://WWW.ECOACTION.GC.CA/CLIMATECHANGE-CHANGEMENTSCLIMATIQUES/INDEX-ENG.CFM>. 31 “SPEAKING POINTS FOR THE HONOURABLE JIM PRENTICE, PC, QC, MP, MINISTER OF THEENVIRONMENT, TO THE MEMBERS OF THE UNIVERSITY OF CALGARY SCHOOL OF PUBLICPOLICY AND THE SCHOOL OF BUSINESS”, CALGARY, ALBERTA, 1 FEBRUARY 2010.32 MINISTRY OF FINANCE, “G-20 COMMITMENT—FOSSIL FUEL SUBSIDIES”, MEMORANDUMFROM MICHAEL HORGAN TO MINISTER OF FINANCE (18 MARCH 2010), AVAILABLE AT<HTTP://COMMUNITIES.CANADA.COM/SHAREIT/BLOGS/POLITICS/ARCHIVE/2010/05/28/PRENTICE-AND-FLAHERTY-BEHIND-CLOSED-DOORS-WITH-PM.ASPX>.33 TIM WEIS, NEW ANALYSIS COMPARES U.S. AND CANADIAN INVESTMENTS INSUSTAINABLE ENERGY IN 2010, THE PEMBINA INSTITUTE, 11 MARCH 2010. 34 DAVID LJUNGGREN AND SCOTT HAGGETT, “CANADA WAITING FOR U.S. TO TAKE LEAD ONCURBING EMISSIONS” VANCOUVER SUN, 19 DECEMBER 2009. 35 SEE THE WEBSITE OF THE ENERGY POLICY INSTITUTE OF CANADA:<WWW.CANADASENERGY.CA>.

© GP/MARKEL REDONDO

23

image A MAINTENANCE WORKER MARKSA BLADE OF A WINDMILL AT GUAZHOUWIND FARM NEAR YUMEN IN GANSUPROVINCE, CHINA.

references36 SEE: <HTTP://WWW.CANREA.CA/SITE/NATIONAL-STRATEGY/>. 37 MINISTRY OF FINANCE, “G-20 COMMITMENT—FOSSIL FUEL SUBSIDIES,”MEMORANDUM FROM MICHAEL HORGAN TO MINISTER OF FINANCE. (18 MARCH 2010).THE FEDERAL GOVERNMENT HAS ALSO PROVIDED $1 BILLION FOR CARBON CAPTUREAND STORAGE PROJECTS:HTTP://WWW.CLIMATECHANGE.GC.CA/DEFAULT.ASP?LANG=EN&N=D22D143E-138 SEE: CARRIE TAIT, “NATIONAL ENERGY STRATEGY PUSH,” NATIONAL POST, 29 APRIL2010, AND DAVID EMERSON, “MAKE NATIONAL ENERGY STRATEGY A PRIORITY.”EDMONTON JOURNAL, 27 MARCH 2010.39 ROGER GIBBINS AND KARI ROBERTS, CANADA'S POWER PLAY: THE CASE FOR ACANADIAN ENERGY STRATEGY FOR A CARBON-CONSTRAINED WORLD, CANADA WESTFOUNDATION, SEPTEMBER 2008.40 STANDING SENATE COMMITTEE ON ENERGY, THE ENVIRONMENT AND NATURALRESOURCES, ATTENTION CANADA! PREPARING FOR OUR ENERGY FUTURE: TOWARDS ACANADIAN SUSTAINABLE ENERGY STRATEGY, JUNE 2010.41 CANADIAN ENERGY RESEARCH INSTITUTE, THE IMPACTS OF CANADIAN OIL SANDSDEVELOPMENT ON THE UNITED STATES’ ECONOMY, OCTOBER 2009.42 SHAWN MCCARTHY, “U.S. CARBON RULES POSE OIL SANDS HURDLE”, GLOBE ANDMAIL, 6 JANUARY 2010.43 SEE: <HTTP://WWW.CAPP.CA/ABOUTUS/PAGES/ADCAMPAIGNS.ASPX#BWW7XYAW6RZRAND HTTP://WWW.CANADASOILSANDS.CA/EN/>.

2.1.3 a national energy strategy for canada: energy[r]evolution or status quo?

This report is intended to inform a public discussion on Canada’senergy future. Ever since the political and oil industry backlashagainst the National Energy Policy of the 1980s, however, discussionof any kind of national energy strategy in Canada has been taboo.

This is changing. The renewable energy industry has long called for anational energy strategy, to little effect.36 Environmentalists havesupported a public role in shaping our energy future, although they haveusually labelled it a climate plan rather than an energy strategy. Keyopponents have been the Canadian federal government, the governmentof Alberta, and the oil and gas industry.

Yet the federal government’s Energy Superpower vision is an energy strategy, one which it is supporting with federal subsidies37 aswell as with changes to regulatory processes governing fossil fuel andnuclear infrastructure.

And now, major conventional energy industry players are also calling onthe federal and provincial governments to adopt a national energystrategy,38 along with think tanks such as the Canada West Foundation.39

The testimony of these groups before the Canadian Senate convinced itsEnergy, Environment and Natural Resources Committee to support thedevelopment of a Canadian energy strategy.40

This reversal of long-standing opposition to a federal role in energyplanning is a product of three principal developments. The first isrelated to how the absence of federal leadership on climate change hasled to a “patchwork” of regulatory initiatives at the provincial andregional levels. These initiatives reflect underlying competition betweenregions over new energy investment, in order to obtain theaccompanying jobs and tax revenues. Ontario, Quebec and BritishColumbia, for example, are pursuing investments in renewable energywithin their respective territories, and have joined with a number ofAmerican states, led by California, in the Western Climate Initiative toprovide a framework for what they hope will be the future nationalsystems for regulating greenhouse gas emissions. Alberta, and to alesser extent Saskatchewan and Newfoundland, are pursuinginvestments in unconventional oil and gas development. The CanadianEnergy Research Institute, for example, has estimated that a $379-billion investment will be required by 2025 to bring oil production toaround four million barrels per day.41

There is also a competition amongst jurisdictions for a larger share ofthe national carbon budget. Even though industry lobbies against anychange, there is widespread acknowledgement that greenhouse gasemissions will eventually be constrained either through regulation ormarket-based mechanisms. Provincial governments also recognize thatthe sectoral allocation of emissions permits (e.g., between themanufacturing sector and upstream oil and gas) under a cap-and-tradesystem will have important regional implications.

Industry is concerned that it will face higher compliance costs if ithas to deal with multiple systems for regulating greenhouse gasemissions, and the energy industry in particular is calling for a

national system that would simplify and enhance the reliability oftheir investment strategy, as described below.

The second development has to do with concern over possible futureregulatory measures in the United States, not only on climate changebut also to “end America’s addiction to oil.” There are several policymeasures being put in place, such as California’s Low Carbon FuelStandard; and corporate and municipal decisions to not buy oil fromthe tar sands. There has also been ongoing consideration of multi-stateregional or a national low carbon fuel standard that would limit themarket for carbon-intensive oil from the tar sands.42

On the other hand, a countervailing concern—energy security in theUnited States (particularly concern over access to oil)—makes theCanadian tar sands seem more attractive as a secure and reliable sourceof petroleum. Yet the market for oil is truly global, and measures toreduce oil dependency in the United States, if accompanied by similarmeasures in the rest of the world along the lines proposed in the globalEnergy [R]evolution scenarios, would push the high-cost oil from the tarsands out of the market (as illustrated below in Figure 2.1).

Taken together, looming restrictions on dirty oil and concerns overenergy security make a strong argument (from the oil and gasindustry’s perspective) for locking in high-carbon projects now. Tarsands developments are highly capital-intensive projects with long lifespans. They have huge up-front costs, but relatively low operatingcosts, so that once they are built there is a powerful incentive to keepthem operating. Hence the push to establish a national energystrategy that facilitates the rapid development of these resources,before policy measures to reduce greenhouse gas emissions or avoidtar sands development are put in place.

The third development that has led to a shift in the position of key oilindustry players on a national energy strategy is related to their efforts toregain their “social license” for continued development. By havingindividual projects (albeit often multi-billion-dollar projects) included in astrategy endorsed by the federal and provincial governments, it is hopedthat the onus for defending developments will shift from the industryitself to government. This is similar to the way in which a governmentpermit for the release of harmful pollutants provides companies a sociallicense within the communities where they operate.

implem

entin

g th

e energ

y [r]evolutio

n|

CANADIA

N P

OLIC

Y IS

SUES

2

24


This social license has been shaken by the global spotlight that has beencast on the environmental and social problems associated with the tarsands. In response, the oil and gas industry has launched majoradvertising and social media campaigns.43 It has also launched a politicallobbying campaign in favour of a national energy strategy thatincorporates both the planned expansion of fossil fuel extraction as wellas modest investments in renewable energy sources and energy efficiency.

The Canadian Association of Petroleum Producers, the CanadianPetroleum Products Institute, the Canadian Gas Association and theCanadian Energy Pipeline Association, for example, have come togetherto proactively develop and advocate for an “Energy FrameworkInitiative” that would form the basis of such a strategy.44 This Initiativeis explicitly geared towards ensuring the industry’s social license for theexpansion of fossil fuel infrastructure and as a response to what theassociations describe as “uninformed media and public reactionsagainst energy development.”45

Energy companies have also joined together to advocate for a nationalenergy strategy. In 2009, for example, the major tar sands companies(along with other energy players) formed the Energy Policy Institute ofCanada (EPIC), headed by former Cabinet minister David Emerson,with a “singular focus on one task: to draft an energy strategy andpolicy recommendations.” This approach, however, is rooted in theenergy status quo, as shown by EPIC’s Guiding Principles, whichinclude “advance the primacy of the Canada-United States energyrelationship” and “help design regulatory processes that aid, ratherthan impede, responsible energy development.”46

And many of Canada’s major think tanks and business groups have alsojoined in this call. The recent “Banff Dialogue” organized in April 2010was a “group convened by Canada’s leading Think Tanks [which] includedrepresentatives of major Canadian corporations involved with all forms ofenergy, members of the Energy Policy Institute of Canada, the EnergyFramework Initiative, the Canada Council of Chief Executives and theCanadian Chamber of Commerce” that came to the “unanimous viewthat there was a definite need for a ‘Canadian Clean Energy Strategy’ andit is needed now.”47

It is, of course, not surprising that the oil and gas industry would seekto defend its interests (as it sees them now), in the face of criticismfrom environmental organizations, First Nations, members of thepublic, and shareholders concerned with the social and environmentalimplications of the status quo.

Indeed, its support for a national energy strategy in Canada is awelcome development, as the Energy [R]evolution scenarios described inthis report are intended to inform the debate on such a strategy.

It would be unacceptable, however, for such a debate to be limited tothe backrooms dominated by industry lobbyists, or premised upon aframework rooted in the status quo. A revolution in our energy systemis a fundamental prerequisite for our environmental and economicwell-being, and needs an informed public debate.

At the L’Aquila G8 Summit in 2008, the Harper governmentsupported a commitment to an aggregate industrial countrygreenhouse gas reduction target of “80% or more by 2050 compared

to 1990 or more recent years.”48 Moreover, in May 2010, theCanadian parliament passed the Climate Change Accountability Act(Bill C-311), which requires the government to cut greenhouse gasemissions 25% below 1990 levels by 2020 and 80% by 2050. TheAct also requires the government to set regulations that ensure thatthese targets are met; however, to date, the government has taken noaction in this regard.

The Reference Scenario outlined in this report—based on theInternational Energy Agency’s Reference Scenario, incorporatingexisting energy and environmental policies—would result in Canada’senergy-related greenhouse gas emissions in 2050 being 32% above1990 levels. The Energy [R]evolution scenarios outlined in thisreport, on the other hand, would actually achieve the level ofreduction that the Canadian government has accepted as its goal for2050. The basic Energy [R]evolution scenario would reduce Canadianenergy-related greenhouse gas emissions in 2050 by 84%, relative to1990 levels, while the Advanced Energy [R]evolution scenario wouldcut Canadian emissions by 94%, relative to 1990 levels.

There may well be other energy mixes that could achieve an 80% orgreater reduction in greenhouse gas emissions by 2020. But in light of thetransformative nature of the changes outlined in the Energy [R]evolutionscenarios, it is clear that a tweaking of the status quo—as proposed todate by the oil and gas industry and as envisioned in the Harpergovernment’s Energy Superpower ambitions anchored in “an ocean of oil-soaked sand”—won’t even come close to getting the job done.

2.1.4 energy [r]evolution and the tar sands

Unlike the electricity system, which is primarily regional, the market foroil is global. So in this case, we need to look at how the global Energy[R]evolution scenario would affect the global demand for oil.

Canada already produces more oil than it consumes, so the Canadiangovernment’s Energy Superpower ambitions are premised on theworld’s not being able to do without oil from the tar sands. This isechoed by companies like BP, that have been responding to criticismof their ventures into unconventional oil by citing projected futureenergy needs from the International Energy Agency (IEA).49

references44 FOR EXAMPLE, IN PREFACING HER PRESENTATION ON THE ENERGY FRAMEWORKINITIATIVE TO THE 2010 NATIONAL ENERGY BOARD–ORGANIZED ENERGY FUTURESCONFERENCE, THE PRESIDENT AND CEO OF THE CANADIAN ENERGY PIPELINEASSOCIATION, BARBARA KENNEY, ARGUED THAT A NATIONAL ENERGY STRATEGY WAS“VITAL” FOR CANADA’S FUTURE.45 SEE: “SIX PILLARS OF ENERGY POLICY,” ONLINE AT<HTTP://WWW.ENERGYFRAMEWORK.CA/PAPERS/SAMPLE-PAPER/?PAGE=5>.46 SEE: <HTTP://WWW.CANADASENERGY.CA/GUIDING-PRINCIPLES/>. 47 CANADA SCHOOL OF ENERGY AND ENVIRONMENT, TOWARDS A TRULY CANADIAN CLEANENERGY STRATEGY: SUMMARY OF THE BANFF CLEAN ENERGY DIALOGUE APRIL 8–10,2010, NATIONAL ROUND TABLE ON THE ENVIRONMENT AND ECONOMY, PUBLIC POLICYFORUM, AVAILABLE AT<HTTP://WWW.OREG.CA/WEB_DOCUMENTS/CANADIAN_CLEAN_ENERGY_STRATEGY.PDF>.48 G8 L’AQUILA DECLARATION, RESPONSIBLE LEADERSHIP FOR A SUSTAINABLE FUTURE,JULY 2009, SECTION 65. 49 SEE, FOR EXAMPLE, THE RESPONSE OF BP TO THE QUESTION “DOES THE WORLD NEEDOIL FROM THE OIL SANDS” ON PAGE 12 OF ITS OPERATING AT THE ENERGY FRONTIERS:SUSTAINABILITY REVIEW 2009, WHICH EXPLICITLY CITES THE IEA’S REFERENCESCENARIO.50 IEA, WORLD ENERGY OUTLOOK 2009, P. 44.

2

implem

entin

g th

e energ

y [r]evolutio

n|

CANADIA

N P

OLIC

Y IS

SUES

25

The IEA’s World Energy Outlook 2009 includes a business-as-usualreference scenario in which the output from the Canadian tar sandswould triple over the next 20 years. This scenario, however, isdescribed as one which has “alarming consequences for climatechange and energy security.”50

According to the IEA, the possible future that includes such a rapidexpansion of the tar sands “takes us inexorably towards a long-termconcentration of greenhouse gases in the atmosphere in excess of 1,000parts per million CO2 equivalent. The CO2 concentration implied by thereference scenario would result in the global average temperature risingby up to 6 degrees Celsius. This would lead almost certainly to massiveclimatic change, and irreparable damage to the planet.”51

This reference scenario that is used as justification for expanding tar sandsoperations was created as what the IEA Executive Director labeled a“caution.”52 The IEA was actually advocating a scenario that it called a“low-carbon energy revolution,” which would have a 50% chance ofkeeping the increase in global temperatures to below 2 degrees Celsiusabove pre-industrial levels53 —the stated aim of the Copenhagen Accordthat came out of the climate change summit in December 2009.

The IEA notes that its low-carbon scenario would also dramaticallycut air pollution and reduce fuel costs in the transport sector by $6.2trillion over the 2010–2030 period, helping to pay for the cost ofmaking the change.

The only real losers would be the corporations that invested inCanada’s tar sands, as they are first up on the chopping block. TheIEA report found that the high capital costs of Canadian tar sandsprojects meant that they accounted for over 85% of all of theupstream oil and gas projects in the world that were cancelled orpushed back by at least 18 months globally in response to the recenteconomic recession.54 And efforts to reduce greenhouse gas emissionsunder the IEA’s low-carbon scenario would reduce the global growthof unconventional oil by 44%, “with Canadian oil sands particularlyheavily affected.”55

Even this, however, is a very risky strategy with respect to protectinghuman and natural communities from dangerous levels of global warming.In order to avoid the most catastrophic impacts of climate change, wemust keep the global temperature increase as far below 2°C as possiblerather than gamble on a 50/50 chance of missing this upper limit. Asnoted in the introduction to this report, the latest science shows that awarming of 2°C above pre-industrial levels would pose unacceptable risksto many of the world’s key natural and human systems.

If rising temperatures are to be kept within acceptable limits,greenhouse gas emissions must be reduced in line with the Energy[R]evolution scenarios. This implies elimination of risky, high-carbonunconventional sources such as the tar sands.

The main demand for oil comes from the transport sector. This demandis projected to increase substantially over the coming decades, requiringmajor investments in exploration and development of new supplies fromincreasingly risky and expensive sources. In the IEA’s referencescenario, demand for oil rises from 84.7 million barrels per day in 2008to 105.2 million barrels per day in 2030, with unconventional oil

production rising from 1.8 to 7.4 million barrels per day over the sameperiod.56 In the IEA’s low-carbon scenario, total demand for oil in 2030is twelve million barrels per day lower than in its reference scenario, butstill higher than 2008 levels.

To cut back even further on the need for oil, the Energy [R]evolutionscenarios tap into the large potential for improving the efficiency of the transport sector by shifting freight from road torail, expanding public transit, and by using much lighter, smaller andmore efficient passenger vehicles.

The other major factor reducing the demand for oil will be a switchto electric drive-trains in vehicles. In the Advanced Energy[R]evolution scenario, the final energy share of electric vehicles onthe road increases to 4% by 2020, 19% by 2030 and to over 50%by 2050. Public transport systems will also increasingly useelectricity to power their vehicles.

This reduces greenhouse gas emissions because the electricity sectorwill be the pioneer of renewable energy utilization. By 2030, 60% ofelectricity globally will be produced from renewable sources, rising to95 per cent by 2050. A significant share of the fluctuating powergeneration from wind and solar photovoltaic will be used to supplyelectricity to vehicle batteries and to produce hydrogen as asecondary fuel in transport and industry.

When combined, these factors eliminate any global need for any tar sands oil by 2030, and the demand for oil continues to fall evenfurther by 2050.

references51 IEA, WORLD ENERGY OUTLOOK 2009, P. 44.52 CITED IN: IEA, NEWS RELEASE, 10 NOVEMBER 2009. 53 IEA, WORLD ENERGY OUTLOOK 2009, P. 196.54 IEA, WORLD ENERGY OUTLOOK 2009, TABLE 3.2, P. 142.55 IEA, WORLD ENERGY OUTLOOK 2009, P. 216.56 IEA, WORLD ENERGY OUTLOOK 2009, P. 81.

figure 2.1: global demand for oil under four scenarios

120

100

80

60

40

20

02008 2030: IEA

ReferenceScenario

2030: IEALow CarbonScenario

2030:Energy

Revolution

2030:AdvancedEnergy

Revolution

•UNCONVENTIONAL OIL

• CONVENTIONAL OIL

mill

ions

of ba

rrels of

oil

per da

y

image A WORKER ASSEMBLES WINDTURBINE ROTORS AT GANSU JINFENGWIND POWER EQUIPMENT CO. LTD. INJIUQUAN, GANSU PROVINCE, CHINA.


implem

entin

g th

e energ

y [r]evolutio

n|

CANADIA

N P

OLIC

Y IS

SUES

2

26


experience of feed-in tariffs

• Feed-in tariffs are seen as the best way forward, especially indeveloping countries. By 2009 this system had incentivised 75% ofPV capacity worldwide and 45% of wind capacity.

• Based on experience, feed-in tariffs are the most effectivemechanism to create a stable framework to build a domesticmarket for renewables. They have the lowest investment risk,highest technology diversity, lowest windfall profits for maturetechnologies and attract a broad spectrum of investors.61

• The main argument against them is the increase in electricity prices forhouseholds and industry, as the extra costs are shared across allcustomers. This is particularly difficult for developing countries, wheremany people can’t afford to spend more money for electricity services.

For developing countries, feed-in laws would be an ideal mechanismto support the implementation of new renewable energies. The extracosts, however, which are usually covered in Europe, for example, by avery minor increase in the overall electricity price for consumers, arestill seen as an obstacle. In order to enable technology transfer fromAnnex 1 countries to developing countries, a mix of a feed-in law,international finance and emissions trading could be used to establisha locally based renewable energy infrastructure and industry with theassistance of OECD countries.

Finance for renewable energy projects is one of the main obstacles indeveloping countries. While large scale projects have fewer fundingproblems, there are difficulties for small, community based projects, eventhough they have a high degree of public support. The experiences frommicro credits for small hydro projects in Bangladesh, for example, aswell as wind farms in Denmark and Germany, show how both stronglocal participation and acceptance can be achieved. The main reasons forthis are the economic benefits flowing to the local community andcareful project planning based on good local knowledge andunderstanding. When the community identifies the project rather thanthe project identifying the community, the result is generally fasterbottom-up growth of the renewables sector.

2.2 ftsm: a support scheme for renewable power in developing countries

This section outlines a Greenpeace proposal for a feed-in tariff systemin developing countries whose additional costs would be financed bydeveloped nations. The financial resources for this could come from acombination of innovative sources, could be managed by theCopenhagen Green Climate Fund (that still needs to be established),and the level of contributions should be set through the GDRframework (see 2.3).

Both Energy [R]evolution scenarios show that renewable electricitygeneration has huge environmental and economic benefits. Howeverits investment and generation costs, especially in developing countries,will remain higher than those of existing coal or gas-fired powerstations for the next five to ten years. To bridge this cost gap aspecific support mechanism for the power sector is needed. The Feed-in Tariff Support Mechanism (FTSM) is a concept conceived byGreenpeace International.57 The aim is the rapid expansion ofrenewable energy in developing countries with financial support fromindustrialised nations.

Since the FTSM concept was first presented in 2008, the idea hasreceived considerable support from a variety of different stakeholders.The Deutsche Bank Group´s Climate Change Advisors, for example,have developed a proposal based on FTSM called “GET FiT”.Announced in April 2010, this took on board major aspects of theGreenpeace concept.

2.2.1 bankable renewable energy support schemes

Since the early development of renewable energies within the powersector, there has been an ongoing debate about the best and mosteffective type of support scheme. The European Commission publisheda survey in December 2005 which provided a good overview of theexperience so far. This concluded that feed-in tariffs are by far themost efficient and successful mechanism. A more recent update ofthis report, presented in March 2010 at the IEA Renewable EnergyWorkshop by the Fraunhofer Institute58, underscores this conclusion.The Stern Review on the Economics of Climate Change alsoconcluded that feed-in tariffs “achieve larger deployment at lowercosts”. Globally more than 40 countries have adopted some versionof the system.

Although the organisational form of these tariffs differs from countryto country, there are certain clear criteria which emerge as essentialfor creating a successful renewable energy policy. At the heart ofthese is a reliable, bankable support scheme for renewable projectswhich provides long term stability and certainty.59 Bankable supportschemes result in lower cost projects because they lower the risk forboth investors and equipment suppliers. The cost of wind-poweredelectricity in Germany is up to 40% cheaper than in the UnitedKingdom60, for example, because the support system is more secureand reliable.

references57 IMPLEMENTING THE ENERGY [R]EVOLUTION, OCTOBER 2008, SVEN TESKE,GREENPEACE INTERNATIONAL.58 EFFECTIVE AND EFFICIENT LONG-TERM ORIENTED RE SUPPORT POLICIES, MARIORAGWITZ, MARCH 2010.59 ‘THE SUPPORT OF ELECTRICITY FROM RENEWABLE ENERGY SOURCES’, EUROPEANCOMMISSION, 2005.60 SEE ABOVE REPORT, P. 27, FIGURE 4.61 EFFECTIVE AND EFFICIENT LONG-TERM ORIENTED RE SUPPORT POLICIES,FRAUNHOFER INSTITUTE, MARIO RAGWITZ, MARCH 2010.

2

implem

entin

g th

e energ

y [r]evolutio

n|

FTSM

27

The average additional costs for introducing the FTSM between 2010 and2020 under the Energy [R]evolution scenario are estimated to be between5 and 3 cents/kWh and 5 and 2 cents/kWh under the advanced version.The cost per tonne of CO2 avoided would therefore be around $25.

The design of the FTSM would need to ensure that there were stableflows of funds to renewable energy suppliers. There may thereforeneed to be a buffer between fluctuating CO2 emission prices and stablelong term feed-in tariffs. This would be possible through the proposedGreenhouse Development Rights scheme, which would create a stableincome for non-OECD countries (see Chapter 2.3, Table 2.7 and 2.8).The FTSM will need to secure payment of the required feed-in tariffsover the whole lifetime (about 20 years) of each project.

In order to be eligible, all renewable energy projects must have aclear set of environmental criteria which are part of the nationallicensing procedure in the country where the project will generateelectricity. Those criteria will have to meet a minimum environmentalstandard defined by an independent monitoring group. If there arealready acceptable criteria developed these should be adopted ratherthan reinventing the wheel. The members of the monitoring groupwould include NGOs, energy and finance experts as well as membersof the governments involved. Funding will not be made available forspeculative investments, only as soft loans for FTSM projects.

The FTSM would also seek to create the conditions for private sectoractors, such as local banks and energy service companies, to gain experience in technology development, project development,project financing and operation and maintenance in order to developtrack records which would help reduce barriers to further renewableenergy development.

the key parameters for the FTSM fund will be:

• The mechanism will guarantee payment of the feed-in tariffs over aperiod of 20 years as long as the project is operated properly.

• The mechanism will receive annual income from emissions tradingor from direct funding.

• The mechanism will pay feed-in tariffs annually only on the basis ofgenerated electricity.

• Every FTSM project must have a professional maintenancecompany to ensure high availability.

• The grid operator must do its own monitoring and send generationdata to the FTSM fund. Data from the project managers and gridoperators will be compared regularly to check consistency.

The four main elements for successful renewable energy supportschemes are therefore:

• A clear, bankable pricing system.

• Priority access to the grid with clear identification of who isresponsible for the connection, and how it is incentivised.

• Clear, simple administrative and planning permission procedures.

• Public acceptance/support.

The first is fundamentally important, but it is no good if you don’thave the other three elements as well.

2.2.2 the feed-in tariff support mechanism

The basic aim of the FTSM is to facilitate the introduction of feed-inlaws in developing countries by providing additional financial resourceson a scale appropriate to the circumstances of each country. For thosecountries with higher levels of potential renewable capacity, the creationof a new sectoral no-lose mechanism generating emission reductioncredits for sale to Annex I countries, with the proceeds being used tooffset part of the additional cost of the feed-in tariff system, could beappropriate. For others there would need to be a more directly fundedapproach to paying for the additional costs to consumers of the tariff.The ultimate objective would be to provide bankable and long termstable support for the development of a local renewable energy market.The tariffs would bridge the gap between conventional power generationcosts and those of renewable generation.

the key parameters for feed in tariffs under FTSM are:

• Variable tariffs for different renewable energy technologies, dependingon their costs and technology maturity, paid for 20 years.

• Payments based on actual generation in order to achieve properlymaintained projects with high performance ratios.

• Payment of the ‘additional costs’ for renewable generation based onthe German system, where the fixed tariff is paid minus thewholesale electricity price which all generators receive.

• Payment could include an element for infrastructure costs such asgrid connection, grid re-enforcement or the development of a smartgrid. A specific regulation needs to define when the payments forinfrastructure costs are needed in order to achieve a timely marketexpansion of renewable power generation.

A developing country which wants to take part in the FTSM wouldneed 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 licensing procedures.

© GP

image LE NORDAIS WINDMILL PARK, ONEOF THE MOST IMPORTANT IN AMERICA,LOCATED ON THE GASPÈ PENINSULA INCAP-CHAT, QUEBEC, CANADA.

implem

entin

g th

e energ

y [r]evolutio

n|

FTSM

2

28


FTSMroles and responsibilities

developing country:

Legislation:• feed-in law• guaranteed grid access• licensing

(inter-) national finance institute(s)

Organizing and Monitoring:• organize financial flow• monitoring• providing soft loans• guarantee the payment of the feed-in tariff

OECD country

Legislation:• CO2 credits under CDM• tax from Cap & Trade• auctioning CO2 Certificates

figure 2.2: ftsm scheme

table 2.1: assumptions for ftsm calculations

KEYPARAMETER

2010

2020

2030

AVERAGEFEED-INTARIFF EXCL.SOLAR PV(ct/kWh)

12

11

10

AVERAGEFEED-INTARIFF FORSOLAR PV(ct/kWh)

20

15

10

financial parameters From the beginning of the financial crisis inmid-2008 it became clear that inflation rates and capital costs werelikely to change very fast. The cost calculations in this programme donot take into account changes in interest rates, capital costs orinflation; all cost parameters are nominal based on 2009 levels.

key results The FTSM programme would cover 624TWh by 2015and 4,960 TWh by 2030 of new renewable electricity generation andsave 77.6 GtCO2 between 2010 and 2030. This works out at 3.8GtCO2 per year under the basic Energy [R]evolution scenario and 82GtCO2 or 4.1 GtCO2 per year under the advanced version. With anaverage CO2 price of $23.1 per tonne, the total programme wouldcost $1.62 trillion. This works out at $76.3 billion annually under thebasic version and $1.29 trillion or $61.4 billion annually under theadvanced scenario.

Under the GDR scheme, this would mean that the EU-27 countrieswould need to cover 22.4% ($ billion 289) of these costs, or $14.4annually. The costs for the USA would amount to $24.9 billion each year. India, on the other hand, would receive $13billion per year between 2010 and 2030 to finance the domesticuptake of renewable power generation.

The FTSM will bridge the gap between now and 2030, whenelectricity generation costs for all renewable energy technologies areprojected to be lower than conventional coal and gas power plants.However, this case study has calculated even lower generation costsfor conventional power generation than we have assumed in our priceprojections for the Energy [R]evolution scenario (see Chapter 5, page52, Table 5.3.). This is because we have excluded CO2 emission costs.If these are taken into account coal power plants would havegeneration costs of 10.8 $cents/kWh by 2020 and 12.5 cents/kWh by2030, as against the FTSM assumption of 10 cents/kWh over thesame timescale. However, the advanced Energy [R]evolution casetakes those higher costs into account and reaches economies of scale

2.2.3 financing the energy [r]evolution with ftsm

Based on both Energy [R]evolution Scenarios for developing (non-OECD) countries, a calculation has been done to estimate the costs andbenefits of an FTSM programme using the following assumptions:

power generation costsThe average level of feed-in tariffs, excludingsolar, has been calculated on the assumption that the majority ofrenewable energy sources require support payments of between 7 and 15cents per kilowatt-hour. While wind and bio energy power generation canoperate on tariffs of below 10 cents per kWh, other technologies, such asgeothermal and concentrated solar power, will need slightly more. Exacttariffs should be calculated on the basis of specific market prices withineach country. The feed-in tariff for solar photovoltaic projects reflectscurrent market price projections. The average conventional powergeneration costs are based on new coal and gas power plants withoutdirect or indirect subsidies.

specific CO2 reduction per kWh The assumed CO2 reduction perkWh from switching to renewables is crucial for calculating thespecific cost per tonne of CO2 saved. In non-OECD countries thecurrent level of CO2 emissions for power generation averages 871 gCO2/kWh, and will reduce to 857 gCO2/kWh by 2030 (seeReference scenario Chapter 6). The average level of CO2 emissionsover the period from 2010 to 2020 is therefore 864 gCO2/kWh.

2

implem

entin

g th

e energ

y [r]evolutio

n|

FTSM

SCHEM

E

29

image A WOMAN STUDIES SOLAR POWER SYSTEMS ATTHE BAREFOOT COLLEGE. THE COLLEGE SPECIALISESIN SUSTAINABLE DEVELOPMENT AND PROVIDES ASPACE WHERE STUDENTS FROM ALL OVER THE WORLDCAN LEARN TO UTILISE RENEWABLE ENERGY. THESTUDENTS TAKE THEIR NEW SKILLS HOME AND GIVETHEIR VILLAGES CLEAN ENERGY.

© GP/EMMA STONER

implem

entin

g th

e energ

y [r]evolutio

n|

FTSM

SCHEM

E

2

figure 2.3: feed-in tariffs versus conventional power generation

35

30

25

20

15

10

5

0.02010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030

•AVERAGE FEED-IN TARIFF - EXCL SOLAR

• AVERAGE FEED-IN TARIFF - SOLAR

• AVERAGE CONVENTIONAL POWER GENERATION COSTS

cent

s/kW

h

table 2.4: ftsm programme

KEY RESULTS TOTAL NON-OECD

Period 1 E[R]

Period 1 adv E[R]

Period 2 E[R]

Period 2 adv E[R]

Period 1+2 E[R]

Period 1+2 adv E[R]

YEAR

2010-2019

2010-2019

2020-2030

2020-2030

2010-2030

2010-2030

AVERAGE CO2 COSTPER TONNE [$/ TCO2]

27.8

26.3

18.3

11.9

23.1

19.1

AVERAGE ANNUALCO2 EMISSION

CREDITS(MILLION T CO2)

2,080.4

2,199.3

5,165.8

5,461.0

3,623.1

3,830.1

TOTAL ANNUALCOSTS

(BILLION US$)

57.9

57.9

94.7

64.8

76.3

61.4

TOTAL CO2

CERTIFICATESPER PERIODE

(MILLION T CO2)

20,804

21,993

56,824

60,071

77,628

82,064

TOTAL COSTSPER PERIOD(BILLION $)

579

579

1,042

713

1,621

1,292

more than 1700 gw renewables for developing countries

Overall, the FTSM for non-OECD countries will bring more than1,700 GW (2,300 GW in the advanced version) of new renewableenergy power plants on line, creating about 5 million jobs with anannual cost of under $15,000 per job per year.

for renewable power generation around 5 years earlier. Therefore, inthe second period in the advanced case, the annual costs of the FTSMprogramm drop significantly under the basic version even with muchhigher renewable electricity volume.

As the difference between renewable and coal electricity generationcosts are projected to decrease, more renewable electricity can befinanced with roughly the same amount of money.

table 2.2: ftsm key parameters - energy [r]evolution

KEYPARAMETER

2010

2020

2030

CONVENTIONALPOWER GENERATIONCOSTS (ct/kWh)

7

11

12.5

INTERESTRATES (%)

4

4

4

SPECIFIC REDUCTIONPER KWH (gCO2/kWh)

0.7

0.7

0.7

table 2.3: ftsm key parameters - adv energy [r]evolution

KEYPARAMETER

2010

2020

2030

CONVENTIONALPOWER GENERATIONCOSTS (ct/kWh)

7

10

10

INTERESTRATES (%)

4

4

4

SPECIFIC REDUCTIONPER KWH (gCO2/kWh)

0.7

0.7

0.7

30


2.3 the greenhouse development rights framework

The Energy [R]evolution in Canada will be part of a globaltransformation of the way we produce, distribute and consume energy.As one of the wealthiest countries in the world and as a nation thathas contributed disproportionately towards creating the currentproblem, Canada must contribute its fair share to the global Energy[R]evolution.

The Energy [R]evolution scenarios present a range of pathwaystoward a future based on an increasing proportion of renewableenergy, but such routes are only likely to be followed if theircorresponding investment costs are shared fairly under some form ofglobal climate regime. To demonstrate how this would be possible, wehave used the Greenhouse Development Rights Framework (GDR),designed by EcoEquity and the Stockholm Environment Institute.62

The GDR provides a tool for distributing both emission reduction andfinance targets equitably among the countries of the world.Greenpeace advocates that industrialized countries, as a group, shouldreduce their emissions by at least 40% by 2020 (from 1990 levels),and that developing countries, as a group, should reduce theiremissions by at least 15% by 2020, compared to their projectedgrowth in emissions. On top of these commitments, Greenpeace urgesindustrialized countries to provide financial resources of at leastUS$140 billion per year to fund climate change mitigation andadaptation in developing countries. Below, we show how the GDR willwork for implementing the Energy [R]evolution scenarios.

2.3.1 calculating greenhouse gas emissions underthe greenhouse development rights framework

The Greenhouse Development Rights Framework (GDR) calculatesnational shares of global greenhouse gas obligations based on acombination of responsibility (contribution to climate change) andcapacity (ability to pay). Crucially, the GDR takes inequality withincountries into account and calculates national obligations on the basis ofthe estimated capacity and responsibility of individuals. Individuals withincomes below a “development threshold”—specified in the default caseas $7,500 per capita annual income, adjusted for purchasing power parity(PPP)—are exempted from climate-related obligations. Individuals withincomes above that level are expected to contribute to the costs of globalclimate policy in proportion to their capacity (amount of income over thethreshold) and responsibility (cumulative CO2 emissions since 1990,excluding emissions corresponding to consumption below the threshold).

The calculations of capacity and responsibility are then combined intoa joint responsibility and capacity indicator (RCI) by taking theaverage of the two values. Thus, for example, as shown in Table 2.6,Canada, with 0.5% of the world’s population, has 2.6% of theworld’s capacity in 2010, 3.1% of the world’s responsibility and2.9% of the calculated RCI. This means that in 2010, Canada wouldbe responsible for 3.1% of the costs of global climate policy.

Because the system calculates obligations based on the characteristicsof individuals, and all countries have at least some individuals withincomes over the development threshold, the GDR would eliminate theoverarching formal distinction in the Kyoto Protocol between Annex Iand non–Annex I countries. There would of course still be keydifferences between rich and poor countries, as rich countries wouldbe expected to pay for reductions made in other countries as well asmake steep domestic emissions reductions, while poor countries could

table 2.5: renewable power for non-oecd countries under ftsm programme

ELECTRICITY GENERATION (TWh/a)

Wind E[R]

PV E[R]

Biomass E[R]

Geothermal E[R]

Solar Thermal E[R]

Ocean Energy E[R]

Total - new RE E[R]

Wind adv E[R]

PV adv E[R]

Biomass adv E[R]

Geothermal adv E[R]

Solar Thermal adv E[R]

Ocean Energy adv E[R]

Total - new RE adv E[R]

2007

23.6

0.2

41.2

21.6

0.0

0.0

86.7

23.6

0.2

41.2

21.6

0.0

0.0

86.7

2015

307.0

22.0

218.0

50.5

21.7

4.6

623.8

312.0

22.0

218.0

55.4

24.7

4.6

636.7

2020

854.5

105.4

488.5

111.0

112.1

27.4

1,699.0

1,092.0

204.0

487.0

164.0

281.0

67.0

2,295.0

2030

2,238.0

673.0

950.0

251.0

798.0

48.5

4,958.5

2,949.0

998.0

946.0

715.0

1,550.0

237.0

7,395.0

INSTALLED CAPACITY(GW)

Wind E[R]

PV E[R]

Biomass E[R]

Geothermal E[R]

Solar Thermal E[R]

Ocean Energy E[R]

Total - new RE E[R]

Wind adv E[R]

PV adv E[R]

Biomass adv E[R]

Geothermal adv E[R]

Solar Thermal adv E[R]

Ocean Energy adv E[R]

Total - new RE adv E[R]

2007

15

0

7

4

0

0

26.2

15

0

7

4

0

0

26.2

2015

138

14

44

9

9

1

214.1

140

14

44

10

10

1

218.1

2020

347

59

100

19

36

8

570.7

443

114

100

28

91

20

795.1

2030

865

383

173

44

130

14

1,610.3

1,142

560

173

117

255

70

2,316.2

2

implem

entin

g th

e energ

y [r]evolutio

n|

FTSM

SCHEM

E

references62 KARTHA, S., P. BAER, T. ATHANASIOU AND E. KEMP-BENEDICT, “THE GREENHOUSEDEVELOPMENT RIGHTS FRAMEWORK”, CLIMATE AND DEVELOPMENT 1(2):147-165 (2009).

31

image CHECKING THE SOLAR PANELS ON TOP OF THE GREENPEACE POSITIVEENERGY TRUCK IN BRAZIL.

© GP/FLAVIO CANNALONGA

implem

entin

g th

e energ

y [r]evolutio

n|

GREENHOUSE D

EVELOPM

ENT R

IGHTS

2

expect the majority of the incremental costs for emissions reductionsrequired within their borders to be paid for by wealthier countries.Similarly, the national obligations calculated through the GDR couldbe used to allocate contributions to a global adaptation fund; again,even poor countries would have some positive obligations tocontribute, but they would expect to be net recipients of adaptationfunds, while rich countries would be net contributors.

A detailed description of the GDR can be found in Baer et al., TheGreenhouse Development Rights Framework.63 For this study, the

standard GDR has been slightly modified to account for the most recentIEA World Energy Outlook 2009 baseline emissions and economicgrowth scenario up to 2030, and for the target pathways defined by theEnergy [R]evolution and Advanced Energy [R]evolution scenarios.Because the GDR calculates the share of global climate obligation foreach country, it can therefore be used to calculate (against a baseline)the amount of reductions required for each country to meet aninternational target. Figure 2.4 shows the global obligation required tomove from the IEA baseline to the emissions pathway in the Energy[R]evolution scenario (declining to 25 gigatonnes of carbon dioxide

references63 THE GREENHOUSE DEVELOPMENT RIGHT FRAMEWORK” PUBLISHED IN NOVEMBER2008, BAER ET AL. 2008

table 2.6: GDR factors and RCIs for IEA regions and select countries, for 2010, 2020 and 2030

REGION/COUNTRY

OECDNorth AmericaUnited StatesMexicoCanada

EuropePacificJapan

Non-OECDE.Europe/EurasiaRussia

AsiaChinaIndia

Middle EastAfricaLatin AmericaBrazil

WorldEuropean Union

POPULATION(2010)

17.6%6.6%4.5%1.6%0.5%8.0%3.0%1.9%

82.4%4.9%2.0%52.5%19.7%17.2%14.9%3.1%7.0%2.9%

100.0%7.3%

INCOME USD /A(2010)

32,41337,12845,64012,40838,47229,03530,96133,4225,13711,08915,0314,4245,8992,8182,61712,0988,6459,4429,929

30,471

CAPACITY(2010)

86.6%39.8%35.8%1.3%2.6%29.3%17.5%14.3%13.4%1.5%0.9%5.6%2.9%0.1%0.8%2.4%3.1%1.5%

100.0%28.1%

RESPONSIBILITY(2010)

75.3%41.5%36.8%1.6%3.1%22.2%11.5%7.3%

24.7%7.8%5.9%7.2%4.3%0.1%2.0%4.8%2.9%1.1%

100.0%21.8%

RCI (2010)

80.9%40.6%36.3%1.5%2.9%25.8%14.5%10.8%19.1%4.7%3.4%6.4%3.6%0.1%1.4%3.6%3.0%1.3%

100.0%25.0%

RCI (2020)

72.8%36.9%32.7%1.5%2.7%23.2%12.7%9.2%

27.2%5.2%3.5%12.7%8.3%0.5%1.7%4.3%3.3%1.4%

100.0%22.6%

RCI (2030)

63.7%32.9%28.9%1.5%2.5%20.1%10.7%7.4%

36.3%5.7%3.8%20.1%13.6%1.3%2.0%4.8%3.6%1.4%

100.0%19.6%

figure 2.4: emission reduction wedges under the energy[r]evolution scenario

45,000

40,000

35,000

30,000

25,000

20,000

15,000

10,000

5,000

02010 2015 2020 2025 2030

•BAU

•UNITED STATES

• OECD EUROPE

• OTHER OECD

• EITs

• CHINA

• INDIA

• OTHER NON-OECD

figure 2.5: emission reduction wedges under the advancedenergy [r]evolution scenario

45,000

40,000

35,000

30,000

25,000

20,000

15,000

10,000

5,000

02010 2015 2020 2025 2030

foss

il CO

2em

ission

s (M

t CO

2 )

foss

il CO

2em

ission

s (M

t CO

2 )

32


[GtCO2] in 2020 and 21 GtCO2 in 2030), with the reduction divided into“wedges” proportional to each country’s share.

Figure 2.5 shows the global emissions reductions required under theEnergy [R]evolution scenario, divided into “wedges” proportional toeach country or region’s responsibility and capacity indicator. Notethat the size of each wedge in percentage terms changes over time,consistent with Table 2.6. The largest share is for the United States,followed by Europe, while the wedges for India and China increaseover time. Africa and Developing Asia have the smallest wedges.

The charts in Figure 2.6 show, for the US, European Union (EU)countries, India and China, the relationship between domestic emissionsreductions under the Energy [R]evolution scenarios and the allocation ofresponsibility through the GDR framework. For the EU and the US, theallocations (solid blue and green lines) are well below the estimated

emissions (dotted blue and green lines), with the difference resulting froman international obligation to fund reductions in other countries. In Indiaand China, by contrast, the allocation of permits is greater than theestimated emissions, indicating that other countries will need to support areduction from the level indicated by the allocation (solid lines) andprojected emissions (dashed lines).

Because the forward calculation of the responsibility and capacityindicator (RCI) depends on the budget that is allocated, the percentagereductions of different countries and regions are slightly different underthe Energy [R]evolution and Advanced Energy [R]evolution pathways.Nevertheless, because neither capacity nor responsibility from1990–2010 varies in the two scenarios, the RCIs for specific countriesare still quite similar, and thus the actual allocations going forwarddiffer between the two scenarios primarily because of the stricter targetsin the Advanced Energy [R]evolution scenario.

figure 2.6: annual ghg emissions and reduction pathways allocated under the GDR system for the European Union, USA, China and India

5,000

4,000

3,000

2,000

1,000

0

-5001990 1995 2000 2005 2010 2015 2020 2025 2030

annu

al C

O2em

ission

s (M

t CO

2 )

percent of CO

2emissions

European Union

6,000

5,000

4,000

3,000

2,000

1,000

0

1990 1995 2000 2005 2010 2015 2020 2025 2030

annu

al C

O2em

ission

s (M

t CO

2 )

percent of CO

2emissions

United States

12,000

10,000

8,000

6,000

4,000

2,000

0

1990 1995 2000 2005 2010 2015 2020 2025 2030

annu

al C

O2em

ission

s (M

t CO

2 )

percent of CO

2emissions

China

4,000

3,000

2,000

1,000

0

1990 1995 2000 2005 2010 2015 2020 2025 2030

annu

al C

O2em

ission

s (M

tCO

2 ) percent of CO

2emissions

India

BUSINESS AS USUAL

ENERGY [R]EVOLUTION PATHWAY

GDRS ALLOCATION UNDER ENERGY [R]EVOLUTION

ENERGY [R]EVOLUTION PATHWAY

GDRS ALLOCATION UNDER ADVANCED ENERGY [R]EVOLUTION

2

implem

entin

g th

e energ

y [r]evolutio

n|

GREENHOUSE D

EVELOPM

ENT R

IGHTS

33

© GP/XUAN CANXIONG

image WIND TURBINES AT THE NANWIND FARM IN NAN’AO. GUANGDONGPROVINCE HAS ONE OF THE BEST WINDRESOURCES IN CHINA AND IS ALREADYHOME TO SEVERAL INDUSTRIAL SCALEWIND FARMS.

implem

entin

g th

e energ

y [r]evolutio

n|

GREENHOUSE D

EVELOPM

ENT R

IGHTS

2

It is also important to note that because a GDR allocates obligationsas a percentage of the global commitment, measured in megatonnesof carbon dioxide (MtCO2) in this example, a country with lower percapita emissions will appear to have a more stringent reductiontarget, when its target is stated in terms of a percentage of 1990emissions by 2020 or 2030 However, the GDR calculation does notspecify the split between domestic and internationally supportedreductions. Since we assume that emissions trading or a similarmechanism will lead to a rough equalization of the marginal cost ofreductions, it is in essence the “per capita tonnes of reductions,” andthus per capita costs, which are made comparable (not equal)through the calculation of the RCI. With this in mind, we can seeunder the Energy [R]evolution scenario that the OECD nations have amitigation requirement equal to a reduction to 45% below 1990levels in 2020 and 2% of 1990 levels in 2030.

Based on the Energy [R]evolution pathway for the three OECDregions, the total domestic emissions would add up to 9.9 gigatonnesof CO2 (GtCO2) by 2020 and 7.2 GtCO2 by 2030. Under the GDR, theOECD regions would have an emissions budget of 8.14 GtCO2 by2020 and 2.9 GtCO2 by 2030. Therefore, the richer nations have tofinance the savings of 1.7 GtCO22 by 2020 and 4.3 GtCO2 by 2030 innon–OECD countries.

The non–OECD countries would in aggregate see their emissionsallocation rise from 195% of 1990 levels in 2020 to 200% in 2030.In MtCO2, China’s emissions allocation would rise from about 8,200in 2015 to about 8,500 in 2020 and grow only slightly more by2030. India by contrast would see its allocation rise from 1,600MtCO2 today to about 2,000 by 2020 and 2,800 by 2030. Within theOECD, the US allocation would fall to 52% of 1990 levels by 2020and to 2% by 2030, while the EU’s allocation would fall from 84%today to 33% of 1990 levels by 2020 and -3% of 1990 levels by2030. A negative emissions allocation is simply a requirement to buya larger quantity of emission permits and/or support a larger amountof mitigation internationally.

Under the Advanced Energy [R]evolution scenario, which has globalemissions falling to 25 GtCO2 by 2020 instead of to 27 GtCO2 asunder the basic E[R] scenario, and then to 18 GtCO2 instead of to 22by 2030, reductions are correspondingly steeper. The OECD countries’allocation of emission rights falls to 19% of 1990 levels by 2020and to -22% by 2030, with the US share being 20% and -24%,respectively, and the EU’s share 12% and -22%. China’s emissionsallocation peaks at 8,300 MtCO2 (instead of 8,500 under the basicscenario) and falls to 7,300 MtCO2 by 2030; India, however, changeslittle from its allowances under the less stringent global pathway.

For an interesting comparison in terms of relatively wealthy“developing” countries, which are currently completely excluded frombinding targets under the Kyoto protocol, consider Brazil and Mexico:both see their allocation falling immediately to below their 2010 levels.In the Energy [R]evolution scenario, the drop is about a 15% reductionbelow 2010 levels by 2020; in the Advanced Energy [R]evolutionscenario, the drop is about a 30% reduction below 2010 levels.

Table 2.7 presents an overview of the CO2 emissions rights, by countryand/or region, based on the global Energy [R]evolution pathway towarda level of 27 GtCO2 in 2020 and 21.9 GtCO2 in 2030. The advancedversion shown in Table 2.8 has a stricter reduction pathway, falling to18.3 GtCO2 by 2030, slightly more than ten years ahead of the basicscenario. The GDR system allocates the same emissions rights for eachcountry under the Advanced Energy [R]evolution pathway, but thisscenario also results in a faster uptake of renewable energy, enablingdeveloping countries to leapfrog from conventional to renewable energyfaster. This pathway might also reduce stranded investments resultingfrom closed fossil fuel power stations, as developing countries will beable to build up the energy infrastructure with new technologies from thevery beginning.

In total, all the OECD countries will have cumulative emissions rightsbetween 1990 and 2030 of 8.14 GtCO2 and 7.3 5 GtCO2 under theAdvanced Energy [R]evolution scenario. The scenarios show that21% (Energy [R]evolution) or 27% (Advanced Energy [R]evolution)of those emissions reductions will have to come from internationalactions, as domestic emissions are still too high. In summary, theOECD countries will have to finance a saving of 45 GtCO2 fornon–OECD countries. A possible mechanism to support theintroduction of renewable power generation in those countries—crucial to the Energy [R]evolution scenarios—would be the feed-intariff support mechanism described above.

2.3.2 applying gdr to the energy [r]evolution scenarios

It is obvious that, given their huge responsibilities and largecapacities, industrialized countries have high responsibility andcapacity indicators (RCIs). Therefore the burden of industrializedcountries to reduce emissions extends well beyond domestic emissionsreductions. Tables 2.7 and 2.8 indicate the difference betweencountries’ emissions under the ER scenario and the Advanced ERscenario, and the emissions reductions they would be responsible for ifthe RCI is used to distribute emissions reduction obligations ascompared to projected emissions, to reach the total level of emissionsin both scenarios.

The difference between the domestic emissions under the E[R]scenarios and the emissions under the Advanced E[R] scenariosdefines the responsibility of countries to fund the implementation ofthe Energy [R]evolution scenario in developing countries.

As an example, under the Advanced Energy [R]evolution scenario, Canadawould have the right to emit 349 million tonnes of energy-relatedgreenhouse gases in 2020, but would actually be emitting 434 milliontonnes of energy-related greenhouse gases. Therefore, Canada would beresponsible for financing an additional 85 million tonnes of reductionsoutside of the country, through means such as the feed-in tariff supportmechanism described above. By 2030, Canada would have the right toemit 106 million tonnes of energy-related greenhouse gas emissions, buteven under the aggressive Advanced scenario would still be emitting 290million tonnes; this would result in the requirement to finance 184 milliontonnes worth of emissions elsewhere.

34


table 2.7: greenhouse development rights framework (GDR) - applied to the energy [r]evolution scenario

FOSSIL CO2 EMISSIONIN [MT CO2]


EuropePacificNon-OECDTransition EconomiesAsiaChinaIndiaOther Asia

AfricaMiddle EastLatin AmericaWorld

1990

11,4055,7565,009302445

4,0261,6239,5424,1583,5962,277607712566608613

20,947

2015 2020 2030GDR

EMISSIONRIGHTS

10,8345,7324,847406479

3,2631,838

18,0232,59811,7348,2261,7121,796962

1,6611,069

28,857

DOMESTICEMISSIONRIGHTSUNDER

ADV. E[R]

11,7166,0945,183394516

3,6421,980

28,3082,38211,1707,8301,6261,7141,0011,5551,030

28,854

MITIGATIONFUND

-882-361-33612-37-379-14288521656439686823910539

GDREMISSIONRIGHTS

8,1434,3573,618361378

2,3941,392

18,5872,41812,4988,5032,0541,940922

1,768981

26,730


ADV. E[R]

9,9195,2234,393363466

2,9471,749

16,8101,93111,5268,0331,8071,6861,0131,439901

26,729

MITIGATIONFUND

-1,775-865-775-2-88-553-357

1,7774879724702472549132980

GDREMISSIONRIGHTS

2,9261,7401,278276186648538

19,0372,07713,2848,0652,8612,358887

1,978811

21,963


ADV. E[R]

7,2533,6553,043279334

2,2091,389

14,7071,44010,2526,5572,0351,6601,0311,248736

21,960

MITIGATIONFUND

-4,327-1,915-1,765

-2-148

-1,561-851

4,330637

3,0321,50882669814373075

table 2.8: greenhouse development rights framework (GDR) - applied to the advanced energy [r]evolution scenario

FOSSIL CO2 EMISSIONIN [MT CO2]


EuropePacificNon-OECDTransition EconomiesAsiaChinaIndiaOther Asia

AfricaMiddle EastLatin AmericaWorld

1990

11,4055,7565,009302445

4,0261,6239,5424,1583,5962,277607712566608613

20,947

2015 2020 2030GDR

EMISSIONRIGHTS

10,5245,5754,709399468

3,1601,789

17,8922,57111,6718,1781,7091,784953

1,6461,051

28,417


ADV. E[R]

11,3175,8414,942396503

3,4881,988

17,1092,38211,1427,8131,6201,709998

1,5711,016

28,426

MITIGATIONFUND

-793-266-233

3-36-328-1997831895293669074447534

GDREMISSIONRIGHTS

7,3593,9563,267341349

2,1341,269

18,1612,34212,2668,3232,0391,904895

1,729929

25,520


ADV. E[R]

9,3274,7493,965350434

2,9081,671

16,1791,90611,0677,8751,5241,667970

1,393843

25,506

MITIGATIONFUND

-1,969-793-698-9-85-774-402

1,983436

1,1994485152367433686

GDREMISSIONRIGHTS

911694370218106-11229

17,4591,83712,3017,3242,7422,236804

1,857659

18,370


ADV. E[R]

5,9412,7242,188246290

1,9311,286

12,4361,3038,4855,7441,3321,409889

1,124636

18,377

MITIGATIONFUND

-5,029-2,030-1,818

-29-184

-1,942-1,0575,022534

3,8171,5801,4108278573323

2

implem

entin

g th

e energ

y [r]evolutio

n|

GREENHOUSE D

EVELOPM

ENT R

IGHTS

35

3nuclear power and climate protection

GLOBAL A FALSE SOLUTION TO CLIMATEPROTECTION

NUCLEAR POWER BLOCKS SOLUTIONS THE DANGERS OF NUCLEAR POWERSAFETY RISKS

“safety and securityrisks, radioactivewaste, nuclearproliferation...”GREENPEACE INTERNATIONALCLIMATE CAMPAIGN

image SIGN ON A RUSTY DOOR AT CHERNOBYL ATOMIC STATION. © DMYTRO/DREAMSTIME

references64 BRITISH PETROLEUM (BP), STATISTICAL REVIEW, 2009.65 INTERNATIONAL ATOMIC ENERGY AGENCY, POWER REACTOR INFORMATION SYSTEM DATABASE.66 IEA, ENERGY TECHNOLOGY PERSPECTIVES 2008—SCENARIOS & STRATEGIES TO 2050, 2008.67 ATOMIC ENERGY OF CANADA LIMITED, CORPORATE PLAN SUMMARY: 2002–2003 TO 2006–2007, P. 19.68 MOODY’S INVESTORS SERVICE, “NEW NUCLEAR GENERATING CAPACITY: POTENTIAL CREDITIMPLICATIONS FOR US INVESTOR OWNED UTILITIES,” MAY 2008.69 THE ONTARIO GOVERNMENT DECIDED TO BUY NEW REACTORS BASED ON THE ADVICE OF THEONTARIO POWER AUTHORITY, WHICH SAID THAT AN ASSUMED COST FOR NEW NUCLEAR PLANTSOF $2,972/KW WAS A CONSERVATIVE COST EFFECTIVE. SEE: CANADIAN ENERGY RESEARCHINSTITUTE, ELECTRICITY GENERATION TECHNOLOGIES: PERFORMANCE AND COSTCHARACTERISTICS, PREPARED FOR THE ONTARIO POWER AUTHORITY, AUGUST 2005, P. 7.70 TYLER HAMILTON, “$26B COST KILLED NUCLEAR BID,” TORONTO STAR, 14 JULY 2009.

$1000/kW installed.67 Nuclear vendors in Canada and internationallyhave been unable to meet these cost targets. In 2008, US businessanalysts Moody’s put the cost of nuclear investment as high as$7,500/kWe.68 In 2009, the Ontario government suspended itsprocurement of new reactors when its competitive bidding processrevealed new reactors were three to four times more expensive thanexpected.69 The AECL’s Advanced CANDU design was reported tocost $10,000/kW, or $26 billion, for a 2,400-MW station. This is tentimes more than AECL’s 2002 cost projection for the AdvancedCANDU. Areva’s EPR design was reported to cost $7,375KWh or$23.6 billion for a 3200 MW station.70 Building 1,400 large reactorsof 1,000 MW, even at the current cost of about $7,000/kW, wouldrequire an investment of US$9.8 trillion.

hazardous: Massive expansion of nuclear energy would necessarilylead to a large increase in related hazards. These include the risk ofserious reactor accidents, the growing stockpiles of deadly, high-levelradioactive waste which will need to be safeguarded for hundreds ofthousands of years, and potential proliferation of both nucleartechnologies and materials through diversion to military or terroristuse. The 1,400 large operating reactors in 2050 would generate anannual 35,000 tons of spent fuel (assuming they are light-waterreactors, the most common design for most new projects). This alsomeans 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 innon–OECD countries. This means that a large proportion of the newreactors would need to be built in those countries in order to have aglobal impact on emissions. At the moment, the list of countries withannounced nuclear ambitions is long and worrying in terms of theirpolitical situation and stability, especially with the need to guaranteeagainst the hazards of accidents and proliferation for many decades.The World Nuclear Association compiled a list of the emergingnuclear energy countries in February 2010. In Europe, this includedItaly, Albania, Serbia, Portugal, Norway, Poland, Belarus, Estonia,Latvia, Ireland, and Turkey. In the Middle East and North Africa:Iran and Gulf states, including the United Arab Emirates (UAE),Yemen, Israel, Syria, Jordan, Egypt, Tunisia, Libya, Algeria andMorocco. In central and southern Africa: Nigeria, Ghana, Uganda andNamibia. In South America: Chile, Ecuador and Venezuela. In centraland southern Asia: Azerbaijan, Georgia, Kazakhstan, Mongolia andBangladesh. In South East Asia: Indonesia, Philippines, Vietnam,Thailand, Malaysia, Australia and New Zealand.

Nuclear energy is a relatively minor industry with major problems. Itcovers just one sixteenth of the world’s primary energy consumption,a share set to decline over the coming decades. The average age ofoperating commercial nuclear reactors is 23 years,64 so more powerstations are being shut down than started. In 2008, world nuclearproduction fell by 2%, compared to 2006, and the number ofoperating reactors as of January 2010 was 436, eight fewer than atthe historical peak of 2002.65

In terms of new power stations, the amount of nuclear capacity addedannually between 2000 and 2009 was on average 2,500 megawatts(MW). This was six times less than wind power (14,500 MW perannum between 2000 and 2009). In 2009, 37,466 MW of new windpower capacity was added globally to the grid, compared to only 1,068MW of nuclear. This new wind capacity will generate as much electricityas 12 nuclear reactors; the last time the nuclear industry managed toadd this amount of new capacity in a single year was in 1988.

Despite the rhetoric of a “nuclear renaissance,” the industry isstruggling with a massive increase in costs and construction delays aswell as safety and security problems linked to reactor operation,radioactive waste and nuclear proliferation.

3.1 a false solution to climate protection

The promise of nuclear energy to contribute to both climate protectionand energy supply must be checked against reality. The InternationalEnergy Agency’s (IEA’s) report Energy Technology Perspectives2008,66 for example, has a “Blue Map” scenario that outlines a futureenergy mix which would halve global carbon emissions by the middle ofthis century. To reach this goal, the IEA assumes a massive expansion ofnuclear power between now and 2050, with installed capacity increasingfour-fold and electricity generation reaching 9,857 terawatt-hours(TWh) /year, compared to 2,608 TWh in 2007. In order to achieve this,32 large reactors (1,000 MW each) would have to be built every yearfrom now until 2050. This is unrealistic, expensive, hazardous and toolate to make a difference. According to the IEA scenario, even such amassive global expansion of nuclear power would only cut carbonemissions by less than 5%.

unrealistic: Such a rapid growth is practically impossible, given thetechnical limitations. This scale of development was achieved in thehistory of nuclear power for only two years, at the peak of the state-driven boom of the mid-1980s. It is unlikely to be achieved again, notto mention maintained for 40 consecutive years. While 1984 and1985 saw 31 GW of newly added nuclear capacity, the decadeaverage was 17 GW each year. In the past ten years, less than threelarge reactors have been brought on line annually, and the currentproduction capacity of the global nuclear industry cannot delivermore than an annual six units.

expensive: The IEA scenario assumes very optimistic investmentcosts of $2,100/ kilowatt (kW). This estimate reflects the nuclearindustry’s cost targets for its Generation III reactors. In 2002, forexample, Atomic Energy of Canada Limited (AECL) claimed that itsGeneration III reactor design, the Advanced CANDU, would cost

36

nuclea

r power a

nd clim

ate p

rotectio

n|

A FA

LSE S

OLUTIO

N

3

37

nuclea

r power a

nd clim

ate p

rotectio

n|

NUCLEAR P

OW

ER B

LOCKS S

OLUTIO

NS

3

image MEASURING RADIATION LEVELSOF A HOUSE IN THE TOWN OF PRIPYATTHAT WAS LEFT ABANDONED AFTER THENUCLEAR DISASTER.

© GP/STEVE MORGAN

references71 INTERNATIONAL ENERGY AGENCY, ENERGY TECHNOLOGY PERSPECTIVES 2010:SCENARIOS AND STRATEGIES TO 2050.72 MOHAMED ELBARADEI, ‘TOWARDS A SAFER WORLD’, THE ECONOMIST, 18 OCTOBER 2003.

figure 3.1: new reactor construction starts in past six years. OUT OF 35 NEW REACTORS WHOSE CONSTRUCTION HASSTARTED SINCE 2004, ONLY TWO ARE LOCATED IN EUROPE (FINLAND AND FRANCE).

•FINLAND

•FRANCE

•INDIA

•PAKISTAN

•JAPAN

•KOREA

•RUSSIA

•CHINA

40

35

30

25

20

15

10

5

02004 2005 2006 2007 2008 2009 total

3.3 the dangers of nuclear power

For the reasons explained above, the Energy [R]evolution scenarioenvisages a nuclear phase-out. Existing reactors would be closed at theend of their average operational lifetime of 35 years. We assume that nonew construction is started and only two thirds of the reactors currentlyunder construction will be finally put into operation.

Here is the background as to why nuclear power has been discountedas a useful future technology in the Energy [R]evolution scenario.

Although the generation of electricity through nuclear power producesmuch less carbon dioxide than fossil fuels, there are multiple threatsto people and the environment from its operations. The main ones are:

• nuclear proliferation,

• nuclear waste, and

• safety risks

3.3.1 nuclear proliferation

Manufacturing a nuclear bomb requires fissile material—eitheruranium-235 or plutonium-239. Most nuclear reactors use uraniumas a fuel and produce plutonium during their operation. It isimpossible to adequately protect a large reprocessing plant in orderto prevent the diversion of plutonium to nuclear weapons. A small-scale plutonium separation plant can be built in four-to-six months, soany country with an ordinary reactor can produce nuclear weaponsrelatively quickly.

The result is that nuclear power and nuclear weapons have grown uplike Siamese twins. Since international controls on nuclearproliferation began, Israel, India, Pakistan and North Korea have allobtained nuclear weapons, demonstrating the link between civil andmilitary nuclear power. Both the International Atomic Energy Agency(IAEA) and the Nuclear Non-proliferation Treaty (NPT) embody aninherent contradiction: seeking to promote the development of“peaceful” nuclear power while at the same time trying to stop thespread of nuclear weapons.

Israel, India and Pakistan all used their civil nuclear operations todevelop weapons capability, operating outside internationalsafeguards. North Korea developed a nuclear weapon even as asignatory of the NPT. A major challenge to nuclear proliferationcontrols has been the spread of uranium enrichment technology toIran, Libya and North Korea. The Director General of theInternational Atomic Energy Agency, Mohamed ElBaradei, has saidthat “should a state with a fully developed fuel-cycle capabilitydecide, for whatever reason, to break away from its non-proliferationcommitments, most experts believe it could produce a nuclear weaponwithin a matter of months.”72

too late: Climate science says that we need to reach a peak of globalgreenhouse gas emissions in 2015 and reduce them by 20% by 2020.Even in developed countries with an established nuclearinfrastructure, it takes at least a decade from the decision to build areactor to the delivery of its first electricity, and often much longer. InCanada, it is highly unlikely that any new reactors could be approvedand built by 2020. This means that even if the world’s governmentsdecided to implement strong nuclear expansion now, only a fewreactors would start generating electricity before 2020. Thecontribution from nuclear power towards reducing emissions wouldcome too late to help.

3.2 nuclear power blocks solutions

Even if the ambitious nuclear scenario is implemented, regardless ofcosts and hazards, the IEA concludes that the contribution of nuclearpower to reductions in greenhouse gas emissions from the energysector would be only 4.6%—less than 3% of the global overallreduction required.71

There are other technologies that can deliver much larger emissionreductions, and much faster. Their investment costs are lower and theydo not create global security risks. Even the IEA finds that the combinedpotential of efficiency savings and renewable energy to cut emissions by2050 is more than ten times larger than that of nuclear.

The world has limited time, finance and industrial capacity to changeour energy sector and achieve a large reduction in greenhouseemissions. Choosing the pathway of spending $10 trillion on nucleardevelopment would be a fatally wrong decision. It would not save theclimate but it would necessarily take resources away from solutionsdescribed in this report and at the same time create serious globalsecurity hazards. Therefore new nuclear reactors are a clearlydangerous obstacle to the protection of the climate.

75 INTERNATIONAL ATOMIC ENERGY AGENCY, SAFETY REQUIREMENTS FOR GEOLOGICALDISPOSAL OF RADIOACTIVE WASTE, WS-R-4, 2006.76 SEE THE TESTIMONY OF ALBERT SWEETMAN, EXECUTIVE VICE-PRESIDENT, NUCLEARNEW BUILD, ONTARIO POWER GENERATION, STANDING COMMITTEE ON NATURALRESOURCES, EVIDENCE, WEDNESDAY, 18 NOVEMBER 2009.

references73 IPCC WORKING GROUP II, IMPACTS, ADAPTATIONS AND MITIGATION OF CLIMATECHANGE: SCIENTIFIC-TECHNICAL ANALYSES, 1995.74 WORLD NUCLEAR ASSOCIATION, WASTE MANAGEMENT IN THE NUCLEAR FUEL CYCLE,INFORMATION AND ISSUE BRIEF, FEBRUARY 2006, AVAILABLE AT <WWW.WORLD-NUCLEAR.ORG/INFO/INF04.HTM>.

“despite the rhetoric of a‘nuclear-renaissance’, the industry is strugglingwith a massive increase in costs and constructiondelays as well as safety and security problems.”

nuclea

r power a

nd clim

ate p

rotectio

n|

NUCLEAR P

OW

ER B

LOCKS S

OLUTIO

NS

3

38


3.3.3 safety risks

The nuclear industry believes severe nuclear accidents to be arealistic possibility, to the point where it requires special legislation toshield it from liability in the event of an accident. Internationalreactor vendors, for example, have informed Ontario that they requirethe passage of new, more protective nuclear liability legislation if theyare to build new reactors in Ontario.76

Windscale (1957), Three Mile Island (1979), Chernobyl (1986) andTokaimura (1999) are only a few of the hundreds of nuclearaccidents which have occurred to date. Notably, the world’s firstsignificant nuclear accident occurred in Canada, when Atomic Energyof Canada’s Limited’s NRX reactor exploded in 1952.

A simple power failure at a Swedish nuclear plant in 2006 highlightedour vulnerability to nuclear catastrophe. Emergency power systems atthe Forsmark plant failed for 20 minutes during a power cut and fourof Sweden’s ten nuclear power stations had to be shut down. If powerhad not been restored, there could have been a major incident withinhours. A former director of the Forsmark plant later said that “it waspure luck there wasn’t a meltdown.” The closure of the plants removedat a stroke roughly 20% of Sweden’s electricity supply.

A nuclear chain reaction must be kept under control, and harmfulradiation must, as far as possible, be contained within the reactor,with radioactive products isolated from humans and carefullymanaged. Nuclear reactions generate high temperatures, and fluidsused for cooling are often kept under pressure. Together with theintense radioactivity, these high temperatures and pressures makeoperating a reactor a difficult and complex task.

The risks from operating reactors are increasing and the likelihood of anaccident is now higher than ever. Most of the world’s reactors are morethan 25 years old and therefore more prone to age related failures.Many utilities are attempting to extend their life from the 30 years or sothey were originally designed for up to 60 years, posing new risks.

The United Nations Intergovernmental Panel on Climate Change(IPCC) has also warned that the security threat of trying to tackleclimate change with a global fast reactor programme (usingplutonium fuel) “would be colossal.”73 Even without fast reactors, allof the reactor designs currently being promoted around the worldcould be fuelled by mixed oxide fuel (MOX), from which plutoniumcan be easily separated.

Restricting the production of fissile material to a few “trusted”countries will not work. It will engender resentment and create acolossal security threat. A new UN agency is needed to tackle thetwin threats of climate change and nuclear proliferation by phasingout nuclear power and promoting sustainable energy, in the processpromoting world peace rather than threatening it.

3.3.2 nuclear waste

The nuclear industry claims it can “dispose” of its nuclear waste byburying it deep underground, but this will not isolate the radioactivematerial from the environment forever. A deep dump only slows downthe release of radioactivity into the environment. The industry tries topredict how fast a dump will leak so that it can claim that radiationdoses to the public living nearby in the future will be “acceptablylow.” But scientific understanding is not sufficiently advanced tomake such predictions with any certainty.

As part of its campaign to build new nuclear stations around theworld, the industry claims that problems associated with buryingnuclear waste are to do with public acceptability rather than technicalissues. It points to nuclear dumping proposals in Finland, Sweden orthe 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 forhundreds of thousands of years. In some countries the situation isexacerbated by “reprocessing” this spent fuel, which involves dissolvingit in nitric acid to separate out weapons-usable plutonium. This processleaves behind a highly radioactive liquid waste. There are about270,000 tonnes of spent nuclear waste fuel in storage, much of it atreactor sites. Spent fuel is accumulating at around 12,000 tonnes peryear, with around a quarter of that going for reprocessing.74 Nocountry in the world has a solution for high level waste.

The IAEA recognises that, despite its international safetyrequirements, “… radiation doses to individuals in the future can onlybe estimated and that the uncertainties associated with theseestimates will increase for times farther into the future.”75

The least damaging option for waste already created at the currenttime is to store it above ground, in dry storage at the site of origin,although this option also presents major challenges and threats. Theonly real solution is to stop producing the waste.

39

image NUCLEAR REACTOR IN LIANYUNGANG, CHINA.

© HANSEN/DREAMSTIME

nuclea

r power a

nd clim

ate p

rotectio

n|

SAFETY R

ISKS

3

5. reprocessing

Reprocessing involves the chemicalextraction of contaminated uranium andplutonium from used reactor fuel rods.There are now over 230,000 kilograms ofplutonium stockpiled around the worldfrom reprocessing—five kilograms issufficient for one nuclear bomb.Reprocessing is not the same as recycling:the volume of waste increases many tensof times, and millions of litres ofradioactive waste are discharged into thesea and air each day. The process alsodemands the transport of radioactivematerial and nuclear waste by ship, rail,air and road around the world. Anaccident or terrorist attack could releasevast quantities of nuclear material intothe environment. There is no way toguarantee the safety of nuclear transport.

6. waste storage

There is not a single finalstorage facility for highlyradioactive nuclear wasteavailable anywhere in the world.Safe secure storage of high-levelwaste over thousands of yearsremains unproven, leaving adeadly legacy for futuregenerations. Despite this, thenuclear industry continues togenerate more and more wasteeach day.

1. uranium mining

Uranium, used in nuclear powerplants, is extracted from mines ina handful of countries. Over 90%of supply comes from just sevencountries: Canada, Kazakhstan,Australia, Namibia, Russia, Nigerand Uzbekistan. Mine workersbreathe in radioactive gas, fromwhich they are in danger ofcontracting lung cancer. Uraniummining produces huge quantitiesof mining debris, includingradioactive particles that cancontaminate surface water andfood.

2. uraniumenrichment

Natural uranium andconcentrated ‘yellow cake’contain just 0.7% of thefissionable uranium isotope 235.To be suitable for use in mostnuclear reactors, its share mustgo up to 3 or 5% viaenrichment. This process can becarried out in 16 facilitiesaround the world. 80% of thetotal volume is rejected as‘tails’, a waste product.Enrichment generates massiveamounts of ‘depleted uranium’that ends up as long-livedradioactive waste or is used inweapons or as tank shielding.

3. fuel rod –production

Enriched material is convertedinto uranium dioxide andcompressed into pellets in fuelrod production facilities. Thesepellets fill four-metre-long tubescalled fuel rods. There are 29fuel rod production facilitiesglobally. The worst accident inthis type of facility happened inSeptember 1999, in Tokaimura,Japan, when two workers died.Several hundred workers andvillagers were also exposed to radiation.

4. power plant operation

Uranium nuclei are split in a nuclearreactor, releasing energy which heatsup water. The compressed steam isconverted in a turbine generator intoelectricity. This process creates aradioactive “cocktail” which involvesmore than 100 products. One of theseis the highly toxic and long-lastingplutonium. Radioactive material canenter the environment throughaccidents at nuclear power plants. Theworst accident to date happened atChernobyl, Ukraine, in the then–SovietUnion, in 1986. A typical nuclearreactor generates enough plutoniumevery year for the production of 40nuclear weapons.

figure 3.2: the nuclear fuel chain

U#92

40


“half the solution toclimate change is thesmart use of power.”GREENPEACE INTERNATIONALCLIMATE CAMPAIGN

SMART GRIDSTHE SUPER GRID

THE NEW ELECTRICITY GRIDHYBRID SYSTEMS

KEY PRINCIPLESFROM PRINCIPLES TO PRACTICENEW BUSINESS MODEL

GLOBAL

the energy [r]evolution

44“half the solution toclimate change is thesmart use of power.”GREENPEACE INTERNATIONALCLIMATE CAMPAIGN

DECOUPLE GROWTH FROM FOSSILFUE

L USE. ©

G.POROPAT/DREAMSTIME

41

The climate change imperative demands nothing short of an Energy[R]evolution. The expert consensus is that this fundamental shift mustbegin immediately and be well underway within the next ten years inorder to avert the worst impacts. What is needed is a completetransformation of the way we produce, consume and distribute energy,and at the same time maintain economic growth. Nothing short ofsuch a revolution will enable us to limit global warming to less than arise in temperature of 2° Celsius, above which the impacts becomedevastating.

Current electricity generation relies mainly on burning fossil fuels,with their associated CO2 emissions, in very large power stationswhich waste much of their primary input energy. More energy is lostas the power is moved around the electricity grid network andconverted from high transmission voltage down to a supply suitablefor domestic or commercial consumers. The system is innatelyvulnerable to disruption: localized technical, weather-related, or evendeliberately caused faults can quickly cascade, resulting in widespreadblackouts. Whichever technology is used to generate electricity withinthis 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 bothproduced and distributed.

4.1 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 ofthis centuryWe must learn to respect natural limits. There is only somuch carbon that the atmosphere can absorb. Each year we emitover 25 billion tonnes of carbon equivalent from the consumption andflaring of fossil fuels.77 We are literally filling up the sky. Geologicalresources of coal could provide several hundred years of fuel, but wecannot burn them and keep within safe limits. Oil and coaldevelopment must be ended.

While the basic Energy [R]evolution scenario has a reduction targetfor energy-related CO2 emissions of 50% from 1990 levels, by 2050,the Advanced scenario goes one step further and aims for a reductiontarget of over 80%.

2.equity and fairness As long as there are natural limits there needsto be a fair distribution of benefits and costs within societies,between nations and between present and future generations. Atone extreme, a third of the world’s population has no access toelectricity, while the most industrialized countries consume muchmore than their fair share.

The effects of climate change on the poorest communities areexacerbated by massive global energy inequality. If we are toaddress climate change, one of the principles must be equity andfairness, so that the benefits of energy services—such as light, heat,power and transport—are available for all: north and south, richand poor. Only in this way can we create true energy security, aswell as the conditions for genuine human wellbeing.

The Energy [R]evolution scenario has a target to achieve energyequity as soon as technically possible. By 2050, the average percapita emissions should be between 1 and 2 tonnes of CO2.

3.implement clean, renewable solutions and decentralize energysystems There is no energy shortage. All we need to do is useexisting technologies to harness energy effectively and efficiently.Renewable energy and energy efficiency measures are ready, viableand increasingly competitive. Wind, solar and other renewableenergy technologies have experienced double-digit market growthfor the past decade.

Just as climate change is real, so is the renewable energy sector.Sustainable decentralized energy systems produce fewer carbonemissions, are cheaper, and involve less dependence on importedfuel. They create more jobs and empower local communities.Decentralized systems are more secure and more efficient. This iswhat the Energy [R]evolution must aim to create.

To stop the earth’s climate from spinning out of control, most ofthe world’s fossil fuel reserves—coal, oil and gas—must remain inthe ground. Our goal is for humans to live within the natural limitsof our small planet.

4.decouple growth from fossil fuel use Starting in the developedcountries, economic growth must be fully decoupled from fossil fuelusage. It is a fallacy to suggest that economic growth must bepredicated on the increased combustion of these fuels.

We need to use the energy we produce much more efficiently, and weneed to make the transition to renewable energy and away from fossilfuels quickly in order to enable clean and sustainable growth.

5.phase out dirty, unsustainable energy We need to phase out coaland nuclear power. We cannot continue to build coal plants at atime when emissions pose a real and present danger to bothecosystems and people. And we cannot continue to fuel the myriadnuclear threats by pretending nuclear power can in any way help tocombat climate change. There is no role for nuclear power in theEnergy [R]evolution.

“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

references77 US ENERGY INFORMATION AGENCY, INTERNATIONAL ENERGY ANNUAL 2006.

© GP/NICK COBBING

image GEOTHERMAL ACTIVITY NEAR HOLSSELSNALAR CLOSE TO REYKJAVIK, ICELAND.

4

the en

ergy [r]evo

lutio

n|

KEY P

RIN

CIP

LES

42


4

the en

ergy [r]evo

lutio

n|

FROM

PRIN

CIP

LES T

O P

RACTIC

E

4.2 from principles to practice

In 2007, renewable energy sources accounted for 13% of the world’sprimary energy demand. Biomass, which is mostly used for heating,was the main renewable energy source. The share of renewable energyin electricity generation was 18%. The contribution of renewables toprimary energy demand for heat supply was around 24%. About80% of primary energy supply today still comes from fossil fuels, and6% from nuclear power.78

The time is right to make substantial structural changes in the energyand power sector within the next decade. Many power plants inindustrialized countries, such as the US, Japan and the EuropeanUnion, are nearing retirement; more than half of all operating powerplants are over 20 years old. At the same time, developing countries,such as China, India and Brazil, are looking to satisfy the growingenergy demand created by their expanding economies.

Within the next ten years, the power sector will decide how this newdemand will be met, either by fossil and nuclear fuels or by theefficient use of renewable energy. The Energy [R]evolution scenario isbased on a new political framework in favour of renewable energyand cogeneration, combined with energy efficiency.

To make this happen both renewable energy and cogeneration—on alarge scale and through decentralized, smaller units—have to growfaster than overall global energy demand. Both approaches mustreplace old generating technologies and deliver the additional energyrequired in the developing world.

As it is not possible to switch directly from the current large-scalefossil- and nuclear fuel–based energy system to a full renewableenergy supply, a transition phase is required to build up the necessaryinfrastructure. While remaining firmly committed to the promotion ofrenewable sources of energy, we appreciate that gas, used inappropriately scaled cogeneration plants, is valuable as a transitionfuel and able to drive cost-effective decentralization of the energyinfrastructure. With warmer summers, tri-generation, which

incorporates heat-fired absorption chillers to deliver cooling capacityin addition to heat and power, will become a particularly valuablemeans of achieving emissions reductions.

4.2.1 a development pathway

The Energy [R]evolution envisages a development pathway whichturns the present energy supply structure into a sustainable system.There are three main stages to this.

step 1: energy efficiency and equity

The Energy [R]evolution is aimed at the ambitious exploitation of thepotential for energy efficiency. It focuses on current best practice andtechnologies that will become available in the future, assumingcontinuous innovation. The energy savings are fairly equallydistributed over the three sectors: industry, transport anddomestic/business. Intelligent use, not abstinence, is the basicphilosophy for future energy conservation.

The most important energy-saving options are: improved heat insulationand building design; super-efficient electrical machines and drives;replacement of old-style electrical heating systems by renewable heatproduction (such as solar collectors); and a reduction in energyconsumption by vehicles used for goods and passenger traffic.Industrialized countries, which currently use energy in the mostinefficient way, can reduce their consumption drastically without the lossof either housing comfort or information and entertainment electronics.The Energy [R]evolution scenario uses energy saved in OECD countriesas a compensation for the increasing power requirements in developingcountries. The ultimate goal is stabilization of global energy consumptionwithin the next two decades. At the same time, the aim is to create“energy equity”—shifting the current one-sided waste of energy in theindustrialized countries towards a fairer worldwide distribution ofefficiently used supply.

© DREAMSTIME

figure 4.1: energy loss, by centralized generation systems

© DREAMSTIME

100 units >>ENERGY WITHIN FOSSIL FUEL

61.5 units LOST THROUGH INEFFICIENT

GENERATION AND HEAT WASTAGE

3.5 units LOST THROUGH TRANSMISSION

AND DISTRIBUTION

13 units WASTED THROUGH

INEFFICIENT END USE

38.5 units >>OF ENERGY FED TO NATIONAL GRID

35 units >>OF ENERGY SUPPLIED

22 unitsOF ENERGY

ACTUALLY UTILISED

references78 IEA, ENERGY BALANCE OF NON–OECD COUNTRIES, AND ENERGY BALANCE OF OECDCOUNTRIES, 2009.

43

© GP/PHILIP REYNAERS

image GREENPEACE OPENS A SOLARENERGY WORKSHOP IN BOMA. A MOBILEPHONE GETS CHARGED BY A SOLARENERGY POWERED CHARGER.

4

the en

ergy [r]evo

lutio

n|

FROM

PRIN

CIP

LES T

O P

RACTIC

E

1. PHOTOVOLTAIC, SOLAR FAÇADES WILL BE A DECORATIVEELEMENT ON OFFICE AND APARTMENT BUILDINGS.PHOTOVOLTAIC SYSTEMS WILL BECOME MORE COMPETITIVEAND IMPROVED DESIGN WILL ENABLE ARCHITECTS TO USETHEM MORE WIDELY.

2. RENOVATION CAN CUT ENERGY CONSUMPTION OF OLD BUILDINGSBY AS MUCH AS 80% - WITH IMPROVED HEAT INSULATION,INSULATED WINDOWS AND MODERN VENTILATION SYSTEMS.

3. SOLAR THERMAL COLLECTORS PRODUCE HOT WATER FOR BOTHTHEIR OWN AND NEIGHBOURING BUILDINGS.

4. EFFICIENT THERMAL POWER (CHP) STATIONS WILL COME IN A VARIETY OF SIZES - FITTING THE CELLAR OF A DETACHEDHOUSE OR SUPPLYING WHOLE BUILDING COMPLEXES ORAPARTMENT BLOCKS WITH POWER AND WARMTH WITHOUTLOSSES IN TRANSMISSION.

5. CLEAN ELECTRICITY FOR THE CITIES WILL ALSO COME FROMFARTHER AFIELD. OFFSHORE WIND PARKS AND SOLAR POWERSTATIONS IN DESERTS HAVE ENORMOUS POTENTIAL.

city

figure 4.2: a decentralized energy future EXISTING TECHNOLOGIES, APPLIED IN A DECENTRALIZED WAY AND COMBINED WITH EFFICIENCY MEASURES AND ZERO EMISSION DEVELOPMENTS, CAN

DELIVER LOW-CARBON COMMUNITIES, AS ILLUSTRATED HERE. POWER IS GENERATED USING EFFICIENT COGENERATION TECHNOLOGIES PRODUCING BOTH HEAT

(AND SOMETIMES COOLING) PLUS ELECTRICITY, DISTRIBUTED VIA LOCAL NETWORKS. THIS SUPPLEMENTS THE ENERGY PRODUCED FROM BUILDING-INTEGRATED

GENERATION. ENERGY SOLUTIONS COME FROM LOCAL OPPORTUNITIES, AT BOTH A SMALL AND A COMMUNITY SCALE. THE TOWN SHOWN HERE MAKES USE OF,

AMONG OTHERS, WIND, BIOMASS AND HYDRO RESOURCES. NATURAL GAS, WHERE NEEDED, CAN BE DEPLOYED IN A HIGHLY EFFICIENT MANNER.

to provide sustainable low-emission heating. Although DEtechnologies can be considered “disruptive” because they do not fitthe existing electricity market and system, with appropriate changesthey have the potential for exponential growth, promising “creativedestruction” of the existing energy sector.

A huge proportion of global energy in 2050 will be produced bydecentralized energy sources, although large-scale renewable energysupply will still be needed in order to achieve a fast transition to arenewables-dominated system. Large offshore wind farms andconcentrating solar power (CSP) plants in the sunbelt regions of theworld will therefore have an important role to play.

cogeneration The increased use of combined heat and powergeneration (CHP) will improve the supply system’s energy conversionefficiency, whether using natural gas or sustainable biomass. In thelonger term, a decreasing demand for heat and the large potential forproducing heat directly from renewable energy sources will limit theneed for further expansion of CHP.

renewable electricity The electricity sector will be the pioneer ofrenewable energy utilization. Many renewable electricity technologieshave been experiencing steady growth over the past 20 to 30 years of upto 35% annually and are expected to consolidate at a high level between2030 and 2050. By 2050, under the Energy [R]evolution scenario, mostelectricity will be produced from renewable energy sources. Theanticipated growth of electricity use in transport will further promotethe effective use of renewable power generation technologies.

A dramatic reduction in primary energy demand compared to theIEA’s reference scenario—but with the same GDP and populationdevelopment—is a crucial prerequisite for achieving a significantshare of renewable energy sources in the overall energy supplysystem, compensating for the phasing-out of nuclear energy andreducing the consumption of fossil fuels.

step 2: the renewable energy [r]evolution

decentralized energy and large-scale renewables In order toachieve higher fuel efficiencies and reduce distribution losses, theEnergy [R]evolution scenario makes extensive use of decentralizedenergy (DE).This is energy generated at or near the point of use.

Centralized generation systems waste more than two thirds of theiroriginal energy input (see Figure 4.1).

DE is connected to a local distribution network system, supplyinghomes and offices, rather than the high-voltage transmission system.The proximity of an electricity-generating plant to consumers allowsany waste heat from combustion processes to be piped to nearbybuildings, a system known as cogeneration, or combined heat andpower. This means that nearly all the input energy is put to use, not justa fraction, as with traditional centralized fossil fuel plant.

DE also includes stand-alone systems entirely separate from thepublic networks; for example, heat pumps, solar thermal panels, orbiomass heating. These can all be commercialized at a domestic level

44


renewable heating In the heat supply sector, the contribution ofrenewables will increase significantly. Growth rates are expected to besimilar to those of the renewable electricity sector. Fossil fuels will beincreasingly replaced by more-efficient modern technologies, inparticular solar collectors, sustainably-produced biomass, andgeothermal. By 2050, renewable energy technologies will satisfy themajor part of heating and cooling demand.

transport Before new technologies, including hybrid or electric carsand new fuels such as biofuels, can play a substantial role in thetransport sector, the existing large efficiency potentials have to beexploited. In this study, biomass is primarily committed to stationaryapplications; the use of biofuels for transport is limited by theavailability of sustainably grown biomass.79 Electric vehicles willtherefore play an even more important role in improving energyefficiency in transport and substituting for fossil fuels.

Overall, to achieve an economically attractive growth of renewableenergy sources, a balanced and timely mobilization of all technologiesis essential. Such a mobilization depends on the resource availability,cost reduction potential, and technological maturity. And alongsidetechnology-driven solutions, lifestyle changes—like simply driving lessand using more public transport—have a huge potential to reducegreenhouse gas emissions.

table 4.1: power plant value chain

(LARGE SCALE)GENERATION

PROJECTDEVELOPMENT

INSTALLATION PLANTOWNER

OPERATION &MAINTENANCE

FUELSUPPLY

DISTRIBUTION SALESTASK & MARKET PLAYER

STATUS QUO

MARKET PLAYER

Utility

Mining company

Component manufacturer

Engineering companies & project developers

Very few new power plants + central planning

large scale generation in the hand of few IPP´s

& utilities

global miningoperations

grid operationstill in thehands ofutilities

ENERGY [R]EVOLUTION

POWER MARKET

MARKET PLAYER

Utility

Mining company

Component manufacturer

Engineering companies & project developers

many smaller power plants + decentralized planning

large number of players e.g.IPP´s, utilities, private

consumer, building operators

no fuelneeded(exceptbiomass)

grid operationunder statecontrol

4

the en

ergy [r]evo

lutio

n|

FROM

PRIN

CIP

LES T

O P

RACTIC

E

4.3 new business model

The Energy [R]evolution scenario will also result in a dramaticchange in the business model of energy companies, utilities, fuelsuppliers and the manufacturers of energy technologies. Decentralizedenergy generation and large solar or offshore wind arrays whichoperate in remote areas, without the need for any fuel, will have aprofound impact on the way utilities operate in 2020 and beyond.

While today the entire power supply value chain is broken down intoclearly defined players, a global renewable power supply willinevitably change this division of roles and responsibilities. Table 4.1provides an overview of today’s value chain and how it would changein a revolutionised energy mix.

While today a relatively small number of power plants, owned andoperated by utilities or their subsidiaries, are needed to generate therequired electricity, the Energy [R]evolution scenario projects afuture share of around 60 to 70% of small but numerousdecentralized power plants performing the same task. Ownership willtherefore shift towards more private investors and away fromcentralized utilities. In turn, the value chain for power companies willshift towards project development, equipment manufacturing andoperation and maintenance.

references79 SEE SECTIONS 5.5.4 AND 7.5.1.

45

image THE TRUCK DROPS ANOTHERLOAD OF WOOD CHIPS AT THE BIOMASSPOWER PLANT IN LELYSTAD, THE NETHERLANDS.

© GP/BAS BEENTJES

table 4.2: utilities today

(LARGE SCALE)GENERATION

TRADING

utilities

TRANS-MISSION

FUELSUPPLY

DISTRIBUTION SALES

trader (e.g.banks) local DSO

IPP TSO retailer

miningcompanies

(LARGE & SMALL SCALE)GENERATION

TRADING

utilities investors

TRANS-MISSION

FUELSUPPLY

DISTRIBUTION SALES

STORAGE RENEWABLEGENERATION

RENEWABLEGENERATION

trader (e.g.banks) local DSO

IPP TSO retailer

miningcompanies IT companies

IPP = INDEPENDEND POWER PRODUCER

TSO = TRANSMISSION SYSTEM OPERATOR

LOCAL DSO = LOCAL DISTRIBUTION SYSTEM OPERATOR

4

the en

ergy [r]evo

lutio

n|

NEW

BUSIN

ESS M

ODEL

Simply selling electricity to customers will play a smaller role, as thepower companies of the future will deliver a total power plant to thecustomer, not just electricity. They will therefore move towards becomingservice suppliers for the customer. The majority of power plants will alsonot require any fuel supply, with the result that mining and other fuelproduction companies will lose their strategic importance.

The future pattern under the Energy [R]evolution will see more andmore renewable energy companies, such as wind turbinemanufacturers, also becoming involved in project development,installation and operation and maintenance, whilst utilities will losetheir status. Those traditional energy supply companies which do notmove towards renewable project development will either lose marketshare or drop out of the market completely.

rural electrification Energy is central to reducing poverty, providingmajor benefits in the areas of health, literacy and equity.80 More thana quarter of the world’s population has no access to modern energyservices. In sub-Saharan Africa, 80% of people have no electricitysupply. For cooking and heating, they depend almost exclusively onburning biomass: wood, charcoal and dung.

Poor people spend up to a third of their income on energy, mostly to cookfood. Women in particular devote a considerable amount of time tocollecting, processing and using traditional fuel for cooking. In India, two toseven hours each day can be devoted to the collection of cooking fuel. Thisis time that could be spent on child care, education, or income generation.The World Health Organization estimates that 1.6 million people, mostlywomen and young children in developing countries, die prematurely eachyear from breathing the fumes from indoor biomass stoves.81

The Millennium Development Goal of halving global poverty by 2015 willnot be reached without adequate energy to increase production, incomeand education, create jobs, and reduce the daily grind involved in justhaving to survive. Halving hunger will not come about without energy formore productive growing, harvesting, processing and marketing of food.Improving health and reducing death rates will not happen without energyfor the refrigeration needed for clinics, hospitals and vaccinationcampaigns. The world’s greatest child killer, acute respiratory infection,will not be tackled without dealing with smoke from cooking fires in thehome. Children will not study at night without light in their homes. Cleanwater will not be pumped or treated without energy.

The UN Commission on Sustainable Development argues that “toimplement the goal accepted by the international community ofhalving the proportion of people living on less than US$1 per day by2015, access to affordable energy services is a prerequisite.”82

the role of sustainable, clean renewable energyTo achieve thedramatic emissions cuts needed to avoid climate change—in the order of80% in OECD countries by 2050—will require a massive uptake ofrenewable energy. The targets for renewable energy must be greatlyexpanded in industrialized countries both to substitute for fossil fuel andnuclear generation and to create the economies of scale necessary forglobal expansion. Within the Energy [R]evolution scenario we assumethat the efficient use of modern renewable energy sources, such as solarcollectors, solar cookers and modern, sustainable forms of bioenergy, willreplace inefficient, traditional biomass use.

references80 IT POWER, AND GREENPEACE INTERNATIONAL, SUSTAINABLE ENERGY FOR POVERTYREDUCTION: AN ACTION PLAN, 2002.81 WORLD HEALTH ORGANIZATION, INDOOR AIR POLLUTION AND HEALTH, WHO FACTSHEET NO. 292, JUNE 2005. 82 UNITED NATIONS COMMISSION ON SUSTAINABLE DEVELOPMENT, 9TH SESSION OF THECOMMISSION FOR SUSTAINABLE DEVELOPMENT, CONCLUSION, APRIL 2001.

step 3: optimized integration – renewables 24/7

To accommodate the significantly higher shares of renewable energyexpected under the Energy [R]evolution scenario, a completetransformation of the energy system will be necessary. The gridnetwork of cables and sub-stations that brings electricity to ourhomes and factories was designed for large, centralized generatorsrunning at huge loads, usually providing what is known as “baseload”power. Renewable energy has had to fit in to this system as anadditional slice of the energy mix and adapt to the conditions underwhich the grid currently operates. If the Energy [R]evolution scenariois to be realized, this will have to change.

Some critics of renewable energy say it is never going to be able toprovide enough power for our current energy use, let alone for theprojected growth in demand. This is because it relies mostly onnatural resources, such as the wind and sun, which are not available24/7. Existing practice in a number of countries has already shownthat this is wrong, and further adaptations to how the grid networkoperates will enable the large quantities of renewable generatingcapacity envisaged in this report to be successfully integrated.

We already have sun, wind, geothermal sources and running riversavailable right now, whilst ocean energy, sustainably-producedbiomass and efficient gas turbines are all set to make a contributionin the future. Clever technologies can track and manage energy-usepatterns, provide flexible power that follows demand through the day,use better storage options, and group customers together to form“virtual batteries.” With all these solutions we can secure therenewable energy future needed to avert catastrophic climate change.Renewable energy 24/7 is technically and economically possible, itjust needs the right policy and the commercial investment to getthings moving and “keep the lights on.”83

4.4 the new electricity grid

The “grid” is the collective name for all the cables, transformers andinfrastructure that transport electricity from power plants to the endusers. In all networks, some energy is lost as it is travels, but movingelectricity around within a localized distribution network is moreefficient and results in less energy loss.

The existing electricity transmission (main grid lines) and distributionsystem (local network) was mainly designed and planned 40 to 60years ago. All over the developed world, the grids were built withlarge power plants in the middle and high-voltage alternating current(AC) transmission power lines connecting up to the areas where thepower is used. A lower-voltage distribution network then carries thecurrent to the final consumers. This is known as a centralized gridsystem, and has a relatively small number of large power stationsmostly fuelled by coal or gas.

In the future we need to change the grid network so that it does notrely on large, conventional power plants but instead on clean energyfrom a range of renewable sources. These will typically be smaller-scale power generators distributed throughout the grid. A localizeddistribution network is more efficient and avoids energy losses duringlong-distance transmission. There will also be some concentratedsupply from large renewable power plants. Examples of these largegenerators of the future are the massive wind farms already beingbuilt in Europe’s North Sea and the plan for large areas ofconcentrating solar mirrors to generate energy in Southern Europe orNorthern Africa.

The challenge ahead is to integrate new generation sources and at thesame time phase out most of the large-scale conventional powerplants, while still keeping the lights on. This will require novel types ofgrids and an innovative power system architecture involving both newtechnologies and new ways of managing the network to ensure abalance between fluctuations in energy demand and supply.

elements in the new power system architecture

A hybrid system based on more than one generating source—forexample, solar and wind power—is a method of providing a securesupply in remote rural areas or islands, especially where there is nogrid-connected electricity. This is particularly appropriate indeveloping countries. In the future, several hybrid systems could beconnected together to form a micro-grid, in which the supply ismanaged using smart-grid techniques.

A smart grid is an electricity grid that connects decentralized renewableenergy sources and cogeneration and distributes power highly efficiently.Advanced communication and control technologies such as smartelectricity meters are used to deliver electricity more cost-effectively,with lower greenhouse intensity and in response to consumer needs.Typically, small generators such as wind turbines, solar panels or fuels

cells are combined with energy management to balance out the load ofall the users on the system. Smart grids are a way to integrate massiveamounts of renewable energy into the system and enable thedecommissioning of older centralized power stations.

A super grid is a large-scale electricity grid network linking togethera number of countries, or connecting areas with a large supply ofrenewable electricity to an area with a large demand—ideally basedon more-efficient high-voltage direct current (HVDC) cables. Anexample of the former would be the interconnection of all the largerenewable-based power plants in the North Sea. An example of thelatter would be a connection between Southern Europe and Africa sothat renewable energy could be exported from an area with a largerenewable resource to urban centres where there is high demand.

46


4

the en

ergy [r]evo

lutio

n|

THE N

EW

ELECTRIC

ITY G

RID

references83 THE ARGUMENTS AND TECHNICAL SOLUTIONS OUTLINED HERE ARE EXPLAINED INMORE DETAIL IN THE EUROPEAN RENEWABLE ENERGY COUNCIL /GREENPEACE REPORT[R]ENEWABLES 24/7: INFRASTRUCTURE NEEDED TO SAVE THE CLIMATE, NOVEMBER 2009.

47

© LANGROCK/ZENIT/GP

image THE WIND TURBINES ARE GOINGTO BE USED FOR THE CONSTRUCTION OFAN OFFSHORE WINDFARM ATMIDDELGRUNDEN WHICH IS CLOSE TO COPENHAGEN, DENMARK.

4

the en

ergy [r]evo

lutio

n|

THE N

EW

ELECTRIC

ITY G

RID

Smart grid using micro grids and virtual power plants

figure 4.3: overview of the future power system with high penetration of renewables

SMARTGRID

CITY

SMARTGRID

CITY

SMARTGRID

CITY

SMARTGRID

CITY

SMARTGRID

CITY

SMARTGRID

CITY

SMARTGRID

CITY

SMARTGRID

CITY

SMARTGRID

CITY

North Sea wind turbines and offshore supergrid

CSP in Southern Europe and Africa

North Sea wind turbines and offshore supergrid

existing AC system

source ENERGYNAUTICS

NEW HVDC SUPERGRID

Dis

trib

uti

on C

omp

an

y

VIRTUAL POWER STATION MICROGRID

APP MINIGRID

DISTRIBUTED GENERATION GRID

16kWh battery bank

1kW solar PV

1kW windturbine

1kW verticalwind turbine

3 x 20kW wind turbine

90kW solar PV

2 x 60kW gas turbine

30kW gasturbine

23kW solar PV

64kW testload bank

minigridcontrol room

power grid

site loads

+ -

48


4

the en

ergy [r]evo

lutio

n|

HYBRID

SYSTEM

S &

SM

ART G

RID

S

references

84 EUROPEAN RENEWABLE ENERGY COUNCIL /GREENPEACE INTERNATIONAL,[R]ENEWABLES 24/7: INFRASTRUCTURE NEEDED TO SAVE THE CLIMATE, NOVEMBER 2009.

Finance can often be an issue for relatively poor rural communitieswanting to install such hybrid renewable systems. Greenpeace hastherefore developed a model in which projects are bundled together inorder to make the financial package large enough to be eligible forinternational investment support. In the Pacific region, for example,power generation projects from a number of islands, an entire islandstate such as the Maldives or even several island states could bebundled into one project package. This would make it large enoughfor funding as an international project by OECD countries. Fundingcould come from a mixture of a feed-in tariff and a fund which coversthe extra costs, as proposed in the “[R]enewables 24/7” report,84 andknown as a “feed-in tariff support mechanism.” In terms of projectplanning, it is essential that the communities themselves are directlyinvolved in the process.

4.6 smart grids

The task of integrating renewable energy technologies into existingpower systems is similar in all power systems around the world,whether they are large centralized networks or island systems. Themain aim of power system operation is to balance electricityconsumption and generation.

Thorough forward planning is needed to ensure that the availableproduction can match demand at all times. In addition to balancingsupply and demand, the power system must also be able to:

• fulfill defined power quality standards (voltage/frequency), whichmay require additional technical equipment; and

• survive extreme situations such as sudden interruptions of supply—for example, from a fault at a generation unit or a breakdown inthe transmission system.

Integrating renewable energy by using a smart grid means movingaway from the issue of baseload power toward the question as towhether the supply is flexible or inflexible. In a smart grid, a portfolioof flexible energy providers can follow the load during both day andnight (for example, solar plus gas, geothermal, wind, and demandmanagement) without blackouts.

A number of European countries have already shown that it is possibleto integrate large quantities of variable renewable power generation intothe grid network and achieve a high percentage of the total supply. InDenmark, for example, the average supplied by wind power is about20%, with peaks of more than 100% of demand. On those occasions,surplus electricity is exported to neighbouring countries. In Spain, amuch larger country with a higher demand, the average supplied by windpower is 14%, with peaks of more than 50%.

The key elements of this new power system architecture are micro-grids, smart grids, and an efficient, large-scale super grid. The threetypes of system will support and interconnect with each other (see Figure 4.3).

A major role in the construction and operation of this new systemarchitecture will be played by the information technology (IT) sector.Because a smart grid has power supplied from a diverse range ofsources and locations, it relies on the gathering and analysis of alarge quantity of data. This requires software, hardware and networksthat are capable of delivering data quickly, and responding to theinformation that they contain. Providing energy users with real-timedata about their energy consumption patterns and the appliances intheir buildings, for example, helps them to improve their energyefficiency, and will allow appliances to be used at a time when a localrenewable supply is plentiful—for example, when the wind is blowing.

There are numerous IT companies offering products and services tomanage and monitor energy. These include IBM, Fujitsu, Google,Microsoft and Cisco. These and other giants of thetelecommunications and technology sector have the power to makethe grid smarter, and to move us faster towards a clean energy future.Greenpeace has initiated the “Cool IT” campaign to put pressure onthe IT sector to make such technologies a reality.

4.5 hybrid systems

The developed world has extensive electricity grids supplying power tonearly 100% of the population. In parts of the developing world,however, many rural areas get by with unreliable grids or withpolluting electricity such as, for example, from stand-alone dieselgenerators. This is also very expensive for small communities.

The electrification of rural areas that currently have no access to anypower system cannot go ahead as it has in the past. A standardapproach in developed countries has been to extend the grid byinstalling high- or medium-voltage lines, new substations and a low-voltage distribution grid. But when there is low potential electricitydemand, and long distances between the existing grid and rural areas,this method is often not economically feasible.

Electrification based on renewable energy systems with a hybrid mixof sources is often the cheapest as well as the least pollutingalternative. Hybrid systems connect renewable energy sources such aswind and solar power to a battery via a charge controller, whichstores the generated electricity and acts as the main power supply.Back-up supply typically comes from a fossil fuel; for example, in awind-battery-diesel or PV-battery-diesel system. Such decentralizedhybrid systems are more reliable, consumers can be involved in theiroperation through innovative technologies and they can make best useof local resources. They are also less dependent on large-scaleinfrastructure and can be constructed and connected faster, especiallyin rural areas.

49

image THE MARANCHON WIND TURBINEFARM IN GUADALAJARA, SPAIN IS THELARGEST IN EUROPE WITH 104GENERATORS, WHICH COLLECTIVELYPRODUCE 208 MEGAWATTS OFELECTRICITY, ENOUGH POWER FOR 590,000PEOPLE, ANUALLY.

© GP/FLAVIO CANNALONGA

4

the en

ergy [r]evo

lutio

n|

SM

ART G

RID

S

Until now, renewable power technology development has put mosteffort into adjusting its technical performance to the needs of theexisting network, mainly by complying with grid codes, which coversuch issues as voltage frequency and reactive power. However, thetime has come for the power systems themselves to better adjust tothe needs of variable generation. This means that they must becomeflexible enough to follow the fluctuations of variable renewable power;for example, by adjusting demand via demand-side managementand/or deploying storage systems.

The future power system will no longer consist of a few centralizedpower plants but instead tens of thousands of generation units such assolar panels, wind turbines and other renewable generation, partlydistributed in the distribution network, partly concentrated in largepower plants such as offshore wind parks.

The trade-off is that power system planning will become morecomplex, due to the larger number of generation assets and thesignificant share of variable power generation causing constantlychanging power flows. Smart-grid technology will be needed tosupport power system planning. This will operate by activelysupporting day-ahead forecasts and system balancing, providing real-time information about the status of the network and the generationunits, in combination with weather forecasts. It will also play asignificant role in making sure systems can meet the peak demand atall times and will make better use of distribution and transmissionassets, thereby keeping the need for network extensions to theabsolute minimum.

To develop a power system based almost entirely on renewable energysources will require a new overall power system architecture, includingsmart-grid technology. This concept will need substantial amounts offurther work to fully emerge.85 Figure 4.4 shows a simplified graphicrepresentation of the key elements in future renewables-based powersystems using smart grid technology.

A range of options is available to enable the large-scale integration ofvariable renewable energy resources into the power supply system.These include demand-side management, the concept of a “virtualpower plant” and a number of choices for the storage of power.

The level and timing of demand for electricity can be managed byproviding consumers with financial incentives to reduce or shut offtheir supply at periods of peak consumption. Such a system is alreadyused for some large industrial customers. A Norwegian power suppliereven involves private household customers by sending them a textmessage with a signal to shut down. Each household can decide inadvance whether or not it wants to participate. In Germany,experiments are being conducted with time flexible tariffs so thatwashing machines operate at night and refrigerators turn offtemporarily during periods of high demand.

This type of demand-side management has been simplified by advancesin communications technology. In Italy, for example, 30 millioninnovative electricity counters have been installed to allow remotemeter-reading and control of consumer and service information.86

Many household electrical products or systems, such as refrigerators,dishwashers, washing machines, storage heaters, water pumps and airconditioning, can be managed either by temporary shut-off or byrescheduling their time of operation, thus freeing up electricity load forother uses and dovetailing it with variations in renewable supply.

A virtual power plant (VPP) interconnects a range of real powerplants (for example solar, wind and hydro) as well as storage optionsdistributed in the power system, using information technology. A real-life example of a VPP is the Combined Renewable Energy PowerPlant developed by three German companies.87 This systeminterconnects and controls 11 wind power plants, 20 solar powerplants, 4 CHP plants based on biomass, and a pumped storage unit, allgeographically spread around Germany. The VPP combines theadvantages of the various renewable energy sources by carefullymonitoring (and anticipating, through weather forecasts) when thewind turbines and solar modules will be generating electricity. Biogasand pumped storage units are then used to make up the difference,either delivering electricity as needed in order to balance short-termfluctuations or temporarily storing it.88 Together the combinationensures sufficient electricity supply to cover demand.

A number of mature and emerging technologies are viable options forstoring electricity. Of these, pumped storage can be considered themost established technology. Pumped storage involves a type ofhydroelectric power station that can store energy. Water is pumpedfrom a lower-elevation reservoir to a higher elevation during times oflow-cost, off-peak electricity. During periods of high electrical demand,the stored water is released through turbines. Taking into accountevaporation losses from the exposed water surface, and conversionlosses, roughly 70 to 85% of the electrical energy used to pump thewater into the elevated reservoir can be regained when it is released.Pumped-storage plants can also respond to changes in the powersystem load demand within seconds.

Pumped storage has been successfully used for many decades all over the world. In 2007, the European Union had 38 GW of pumped storage capacity, representing 5% of total electrical capacity.

references

85 SEE ALSO ECOGRID PHASE 1 SUMMARY REPORT, AVAILABLE AT:<HTTP://WWW.ENERGINET.DK/NR/RDONLYRES/8B1A4A06-CBA3-41DA-9402-B56C2C288FB0/0/ECOGRIDDK_PHASE1_SUMMARYREPORT.PDF>.86 MARK SCOTT, “HOW ITALY BEAT THE WORLD TO A SMARTER GRID,” DER SPIEGELONLINE, 17 NOVEMBER 2009.87 SEE ALSO <HTTP://WWW.KOMBIKRAFTWERK.DE/INDEX.PHP?ID=27>.88 SEE ALSO<HTTP://WWW.SOLARSERVER.DE/SOLARMAGAZIN/ANLAGEJANUAR2008_E.HTML>.

50


figure 4.4: the smart-grid vision for the energy [r]evolution A VISION FOR THE FUTURE – A NETWORK OF INTEGRATED MICROGRIDS THAT CAN MONITOR AND HEAL ITSELF.

• PROCESSORS EXECUTE SPECIAL PROTECTION SCHEMES IN MICROSECONDS

• SENSORS ON ‘STANDBY’ – DETECT FLUCTUATIONS AND DISTURBANCES, AND CAN SIGNAL FOR AREAS TO BE ISOLATED

• SENSORS ‘ACTIVATED’ – DETECT FLUCTUATIONS AND DISTURBANCES, AND CAN SIGNAL FOR AREAS TO BE ISOLATED

SMART APPLIANCES CAN SHUT OFF IN RESPONSE TO FREQUENCY FLUCTUATIONS

DEMAND MANAGEMENT USE CAN BE SHIFTED TO OFF-PEAK TIMES TO SAVE MONEY

GENERATORS ENERGY FROM SMALL GENERATORS AND SOLAR PANELS CAN REDUCE OVERALL DEMAND ON THE GRID

STORAGE ENERGY GENERATED AT OFF-PEAK TIMES COULD BE STORED IN BATTERIES FOR LATER USE

DISTURBANCE IN THE GRID

INDUSTRIAL PLANT

CENTRAL POWER PLANT

OFFICES WITHSOLAR PANELS

HOUSES WITHSOLAR PANELS

WIND FARM

ISOLATED MICROGRID

4

the en

ergy [r]evo

lutio

n|

SM

ART G

RID

S

51

Another way of “storing” electricity is to use it to directly meet the demand from electric vehicles. The number of electric cars and trucks is expected to increase dramatically under the Energy[R]evolution scenario. The vehicle-to-grid (V2G) concept, forexample, is based on electric cars equipped with batteries that can becharged during times when there is surplus renewable generation andthen, while the cars are parked, discharged to supply peaking capacityor ancillary services to the power system. During peak demand times,cars are often parked close to main load centres—for instance,outside factories—so there would be no network issues. Within theV2G concept, a virtual power plant would be built using informationand communications technology (ICT) to aggregate the electric carsparticipating in the relevant electricity markets and to meter thecharging/discharging activities. In 2009, the EDISON demonstrationproject in Denmark89 was launched to develop and test theinfrastructure for integrating electric cars into the power system ofthe Danish island of Bornholm.

4.7 the super grid

A Greenpeace simulation study has shown that extreme situationswith low solar radiation and little wind are not frequent in manyparts of Europe, but they can occur. The power system, even withmassive amounts of renewable energy, must be adequately designed tocope with such an event. A key element in achieving this is throughthe construction of new onshore and offshore super grids.

In the Energy [R]evolution scenario, it is assumed that about 70% ofall generation is distributed and located close to load centres. Theremaining 30% will be large-scale renewable generation such aslarge, offshore wind farms or large arrays of concentrating solarpower (CSP) plants. A North Sea offshore super grid, for example,would enable the efficient integration of renewable energy into thepower system across the whole North Sea region, linking the UK,France, Germany, Belgium, the Netherlands, Denmark and Norway. Byaggregating power generation from wind farms spread across thewhole area, periods of very low or very high power flows would bereduced to a negligible number. A dip in wind power generation in onearea would be balanced by higher production in another area, evenhundreds of kilometres away. Over a year, an installed offshore windpower capacity of 68.4 GW in the North Sea would be able togenerate an estimated 247 TWh of electricity.

The cost of developing the grid is expected to be between €15 and 20 billion. This investment would not only allow the broadintegration of renewable energy but also unlock unprecedented power-trading opportunities and cost efficiency. In a recent example, a new600 kilometre–long power line between Norway and the Netherlandscost €600 million to build, but is already generating a daily cross-border trade valued at €800,000.90

references

89 THE EDISON (ELECTRIC VEHICLES IN A DISTRIBUTED AND INTEGRATED MARKETUSING SUSTAINABLE ENERGY AND OPEN NETWORKS) PROJECT IS AN INTERNATIONALRESEARCH PROJECT. SEE: <HTTP://WWW.EDISON-NET.DK/ABOUT-EDISON.ASPX>.90 GREENPEACE REPORT, NORTH SEA ELECTRICITY GRID [R]EVOLUTION, SEPTEMBER 2008.

© GP/EX-PRESS/HEIKE

image A LARGE SOLAR SYSTEM OF 63M2

RISES ON THE ROOF OF A HOTEL INCELERINA, SWITZERLAND. THECOLLECTOR IS EXPECTED TO PRODUCEHOT WATER AND HEATING SUPPORT ANDCAN SAVE ABOUT 6,000 LITERS OF OILPER YEAR. THUS, THE CO2 EMISSIONSAND COMPANY COSTS CAN BE REDUCED.

4

the en

ergy [r]evo

lutio

n|

THE S

UPER G

RID

52


“the technology is here, all we need is political will.”CHRIS JONESSUPORTER AUSTRALIA

COST PROJECTIONS FOR RENEWABLEENERGY TECHNOLOGIES

COST PROJECTIONS FOR EFFICIENTFOSSIL FUEL GENERATION

SCENARIO BACKGROUNDOIL AND GAS PRICE PROJECTIONSCOST OF CO2 EMISSIONS

GLOBAL

scenarios for a future energy supply

55“towards a sustainable globalenergy supply system.”GREENPEACE INTERNATIONALCLIMATE CAMPAIGN

image

WIND TURBINE

IN SA

MUT S

AKHON, T

HAILA

ND. © GP

/VINAI DITH

AJOHN

53

Moving from principles to action on energy supply and climate changemitigation requires a long-term perspective. Energy infrastructuretakes time to build up; new energy technologies take time to develop.Policy shifts often also need many years to take effect. Any analysisthat seeks to tackle energy and environmental issues therefore needsto look ahead at least half a century.

Scenarios are important in describing possible development paths, togive decision-makers an overview of future perspectives and toindicate how far they can shape the future energy system. Twodifferent kinds of scenario are used here to characterize the widerange of possible pathways for a future energy supply system: aReference scenario, reflecting a continuation of current trends andpolicies, and the Energy [R]evolution (E[R]) scenarios, which aredesigned to achieve a set of dedicated environmental policy targets.

The Reference Scenario Reference scenario is based on the referencescenario published by the International Energy Agency (IEA) in WorldEnergy Outlook 2009 (WEO 2009).91 The Reference scenario only takesexisting international energy and environmental policies into account. Itsassumptions include, for example, continuing progress in electricity andgas market reforms, the liberalization of cross-border energy trade, andrecent policies designed to combat environmental pollution. The Referencescenario does not take into consideration additional mechanisms toreduce greenhouse gas emissions, beyond what are already in place orplanned. As the IEA’s projection only covers a time horizon up to 2030,the Reference scenario has extended that horizon by extrapolating keymacroeconomic and energy indicators forward to 2050. This provides abaseline for comparison with the Energy [R]evolution scenarios.

The Energy [R]evolution Scenario Energy [R]evolution scenario hasa key target of reducing worldwide carbon dioxide emissions down to alevel of around 10 gigatonnes per year by 2050, in order to keep theincrease in global temperature under +2°C. A second objective is theglobal phasing-out of nuclear energy. First published in 2007, thenupdated and expanded in 2008, this latest revision of the E[R] scenarioalso serves as a baseline for the more ambitious Advanced Energy[R]evolution scenario. To achieve its targets, the Advanced scenario ischaracterized by significant efforts to fully exploit the large potentialfor energy efficiency, using currently available best-practice technology.At the same time, all cost-effective renewable energy sources are usedfor heat and electricity generation as well as the production of biofuels.The general framework parameters for population and GDP growthremain unchanged from those of the Reference scenario.

The Advanced Energy [R]evolution Scenario is aimed at an evenstronger decrease in CO2 emissions, especially given the uncertainty thateven ten gigatonnes allowed per year might be too much to keep globaltemperature rises at bay. All general framework parameters, such aspopulation and economic growth, remain unchanged. The efficiencypathway for industry and “other sectors” is also the same as in the basicEnergy [R]evolution scenario. What is different is that the Advancedscenario incorporates a stronger effort to develop better technologies toachieve CO2 reduction. So the transport sector factors in lower demand(compared to the basic scenario), resulting from a change in drivingpatterns, a faster uptake of efficient combustion vehicles, and—after2025—a larger share of electric and plug-in hybrid vehicles.

Given the enormous and diverse potential for renewable power, theAdvanced scenario also foresees a shift in the use of renewables from powerto heat. Assumptions for the heating sector therefore include a fasterexpansion of the use of district heat and hydrogen, and more electricity forprocess heat in the industry sector. More geothermal heat pumps are alsoused, which leads, combined with a larger share of electric drives in thetransport sector, to a higher overall electricity demand. In addition, a fasterexpansion of solar and geothermal heating systems is assumed.

In all sectors, the latest market development projections of the renewablesindustry92 have been taken into account (see Table 5.11: “Assumed annualaverage growth rates for renewable energy technologies”). In developingcountries in particular, a shorter operational lifetime for coal power plants,of 20 instead of 40 years, has been assumed in order to allow a fasteruptake of renewables. The speedier introduction of electric vehicles,combined with the implementation of smart grids and faster expansion ofsuper grids (about ten years ahead of the basic Energy [R]evolutionscenario) allows a higher share of fluctuating renewable power generation(photovoltaic and wind) to be employed. The 30% mark for the proportionof renewables in the global energy supply is therefore passed just after2020—ten years ahead of the basic Energy [R]evolution scenario.

The global quantities of biomass and large hydro power remain the samein both Energy [R]evolution scenarios, for reasons of sustainability.

These scenarios by no means claim to predict the future; they simplydescribe three potential development pathways out of the broad range ofpossible “futures.” The Energy [R]evolution scenarios are designed toindicate the efforts and actions required to achieve their ambitiousobjectives and to illustrate the options we have at hand to change ourenergy supply system into one that is sustainable.

5.1 scenarios background

The scenarios in this report were jointly commissioned by Greenpeace andthe European Renewable Energy Council from the Institute of TechnicalThermodynamics, part of the German Aerospace Center (DLR). Thesupply scenarios were calculated using the MESAP/PlaNet simulationmodel adopted in the previous Energy [R]evolution studies. Some detailedanalyses carried out during preparation of the 2008 Energy [R]evolutionstudy were also used as input to this update. The energy demandprojections were developed for the 2008 study by Ecofys Netherlands,based on an analysis of the future potential for energy efficiencymeasures. The biomass potential, judged according to Greenpeacesustainability criteria, has been developed especially for these scenarios bythe German Biomass Research Centre. The future development pathwayfor car technologies is based on a special report produced in 2008 by theInstitute of Vehicle Concepts, DLR for Greenpeace International.

For details on these studies, as well as the assumptions on population andeconomic growth rates, see the 2010 global Energy [R]evolution report.

references91 INTERNATIONAL ENERGY AGENCY, ‘WORLD ENERGY OUTLOOK 2007’, 2007 92 SEE: PROF. ARTHOUROS ZERVOS, CHRISTINE LINS AND JOSCHE MUTH, RE-THINKING2050: A 100% RENEWABLE ENERGY VISION FOR THE EUROPEAN UNION, EUROPEANRENEWABLE ENERGY COUNCIL (EREC), APRIL 2010.93 GREENPEACE INTERNATIONAL, ENERGY [R]EVOLUTION: A SUSTAINABLE WORLDENERGY OUTLOOK, 2007 AND 2008.

5

scenario

s for a

future en

ergy su

pply

|SCENARIO

BACKGROUND



image AERIAL PHOTO OF THE ANDASOL 1 SOLAR POWER STATION, EUROPE’S FIRSTCOMMERCIAL PARABOLIC TROUGH SOLAR POWER PLANT. ANDASOL 1 WILL SUPPLY UP TO200,000 PEOPLE WITH CLIMATE-FRIENDLY ELECTRICITY AND SAVE ABOUT 149,000TONNES OF CARBON DIOXIDE PER YEAR COMPARED WITH A MODERN COAL POWER PLANT.

image MAINTENANCE WORKERS FIX THE BLADES OF A WINDMILL AT GUAZHOU WINDFARM NEAR YUMEN IN GANSU PROVINCE, CHINA.

54


5.2 oil and gas price projections

The recent dramatic fluctuations in global oil prices have resulted inslightly higher forward price projections for fossil fuels. Under the2004 “high oil and gas price” scenario from the EuropeanCommission, for example, an oil price of just CA$39 per barrel (bbl)was assumed in 2030. More recent projections of oil prices by 2030in the IEA’s WEO 2009 range from CA$200890/bbl barrels in thelower-prices sensitivity case up to CA$2008170/bbl in the higher-prices sensitivity case. The reference scenario in WEO 2009 predictsan oil price of CA$2008160/bbl.

Since the first Energy [R]evolution study was published in 2007,however, the actual price of oil has climbed to over CA$113/bbl forthe first time, and in July 2008 reached a record high of more than$140/bbl. Although oil prices fell back to CA$113/bbl in September2008 and around CA$90/bbl in April 2010, the projections in theIEA reference scenario might still be considered to be tooconservative. Taking into account the growing global demand for oil,we have assumed a price development path for fossil fuels based onthe WEO 2009 higher-prices sensitivity case, extrapolated forward to2050 (see Table 5.1).

As the supply of natural gas is limited by the availability of pipelineinfrastructure, there is no world market price for gas. In most regions ofthe world, the gas price is directly tied to the price of oil. Gas prices aretherefore assumed to increase to $25–30/gigajoule (GJ) by 2050.

5.3 cost of CO2 emissions

Assuming that a CO2 emissions trading system is established across allworld regions in the longer term, the cost of CO2 allowances needs to beincluded in the calculation of electricity generation costs. Projections ofemissions costs are even more uncertain than energy prices, however, andavailable studies span a broad range of future estimates. As in theprevious Energy [R]evolution study, we assume CO2 costs of CA$11/t CO2

in 2010, rising to CA$57/t CO2 by 2050. Additional CO2 costs are appliedin Kyoto Protocol Non-Annex B (developing) countries only after 2020.

table 5.1: development projections for fossil fuel prices, in CA$2008

UNIT

barrelbarrelbarrelbarrel

GJGJGJ

GJGJGJ

tonnetonne

GJGJGJ

2000

38.93

5.684.206.92

5.684.206.92

46.78

2005

56.75

2.635.105.13

2.635.105.13

56.30

2007

85.13

3.687.147.19

3.687.147.19

78.82

8.43.73.1

2008

110.31

9.8812.3615.13

9.8812.3615.14

2010

136.87

8.83.93.2

2015

98.37

125.49

8.7312.5214.26

9.5115.9418.17

131.83103.34

9.34.03.6

2020

113.5079.41135.91147.55

10.6214.4916.46

12.1418.8021.39

153.69118.22

10.44.34.0

2025

122.01

158.90

12.0215.6717.76

14.0720.4223.12

158.33121.58

2030

130.5393.67157.72170.25

13.6016.7919.00

16.3221.8924.79

161.96124.17

11.44.94.5

2040

150.00

20.5424.9728.15

181.60

11.75.35.2

2050

150.00

26.9329.5433.25

195.56

11.95.95.6

Crude oil importsIEA WEO 2009 “Reference”USA EIA 2008 “Reference”USA EIA 2008 “High Price”Energy [R]evolution 2010

Natural gas importsIEA WEO 2009 “Reference”United StatesEuropeJapan LNG

Energy [R]evolution 2010United StatesEuropeJapan LNG

Hard coal importsOECD steam coal importsEnergy [R]evolution 2010IEA WEO 2009 “Reference”

Biomass (solid) Energy [R]evolution 2010OECD EuropeOECD Pacific and North AmericaOther regions

table 5.2: assumptions on CO2 emissions cost development(CA$/tCO2)

2015

11.35

2020

22.7

22.7

2030

34

34

2040

45

45

2050

57

57

COUNTRIES

Kyoto Annex B countries

Non-Annex B countries

note GJ = GIGAJOULES.source 2000–2030: IEA WEO 2009 HIGHER-PRICES SENSITIVITY CASE FOR CRUDE OIL, GAS AND STEAM COAL. 2040–2050 AND OTHER FUELS: ASSUMPTIONS OF AUTHOR.

5

scenario

s for a

future en

ergy su

pply

|OIL

AND G

AS P

ROJE

CTIO

NS

5.4 cost projections for efficient fossil fuelgeneration 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 marketdevelopment, further cost reduction potentials are assumed. Thepotential for cost reductions is limited, however, and will be achievedmainly through an increase in efficiency.94

There is much speculation about the potential for carbon capture andstorage (CCS) to mitigate the effect of fossil fuel consumption onclimate change, even though the technology is still under development.

CCS is a means of trapping CO2 from fossil fuels, either before or after theyare burned, and “storing” (effectively disposing of) it in the sea or beneaththe surface of the earth. There are currently three different methods ofcapturing CO2: pre-combustion, post-combustion, and oxyfuel combustion.However, development is at a very early stage and CCS will not beimplemented, in the best case, before 2020 and will probably not becomecommercially viable as a possible effective mitigation option until 2030.

Cost estimates for CCS vary considerably, depending on factors such aspower station configuration, technology, fuel costs, size of project, andlocation. One thing is certain, however: CCS is expensive. It requiressignificant funds to construct the power stations and the necessaryinfrastructure to transport and store carbon. The IPCC assesses costs at$15–75 per tonne of captured CO2 ,95 while a recent US Department ofEnergy report found that installing carbon capture systems in mostmodern plants resulted in a near-doubling of costs.96 These costs areestimated to increase the price of electricity by 21–91%.97

Pipeline networks will also need to be constructed to move CO2 to storagesites. This is likely to require a considerable outlay of capital.98 Costs willvary depending on a number of factors, including pipeline length, diameterand manufacture from corrosion-resistant steel, as well as the volume ofCO2 to be transported. Pipelines built near population centres or ondifficult terrain, such as marshy or rocky ground, are more expensive.99

The Intergovernmental Panel on Climate Change (IPCC) estimates acost range for pipelines of $1–8/tonne of CO2 (t CO2) transported. AUnited States Congressional Research Services report calculated capitalcosts for an 11-mile pipeline in the midwestern region of the US atapproximately $6 million. The same report estimates that a dedicatedinterstate pipeline network in North Carolina would cost upwards of $5billion, due to the limited geological sequestration potential in that partof the country.100 Storage and subsequent monitoring and verificationcosts are estimated by the IPCC to range from $0.5–8.0/tCO2 (forstorage) and $0.1–0.3/tCO2 (for monitoring). The overall cost of CCScould therefore serve as a major barrier to its deployment.101

For the above reasons, CCS power plants are not included in ourfinancial analysis.

Table 5.3 summarizes our assumptions on the technical and economicparameters of future fossil-fuelled power plant technologies. In spite ofgrowing raw material prices, we assume that further technical innovationwill result in a moderate reduction of future investment costs as well as inimproved power plant efficiencies. These improvements are, however,outweighed by the expected increase in fossil fuel prices, resulting in asignificant rise in electricity generation costs.

55

POWER PLANT

Efficiency (%)

Investment costs ($/kW)

Electricity generation costs including CO2 emission costs ($cents/kWh)

CO2 emissions a)(g/kWh)

Efficiency (%)




Efficiency (%)




2030

50

1,317

14.2

670

44,5

1,532

9.5

898

62

1,019

17.4

325

2040

52

1,283

16.1

644

45

1,498

10.6

888

63

1,008

19.7

320

2050

53

1,249

17.8

632

45

1,464

11.7

888

64

1,008

21.5

315

POWER PLANT

Coal-fired condensing power plant

Lignite-fired condensing power plant

Natural gas combined cycle

table 5.3: development of efficiency and investment costs for selected power plant technologies

2020

48

1,351

12.3

697

44

1,566

8.5

908

61

1,031

14.4

330

2015

46

1396

10.2

728

43

1634

7.4

929

59

1,054

11.9

342

2007

45

1,498

7.5

744

41

1,782

6.7

975

57

1,107

8.5

354

note a) CO2 EMISSIONS REFER TO POWER STATION OUTPUTS ONLY; LIFE-CYCLE EMISSIONS ARE NOT CONSIDERED. G/KWH = GRAMS PER KILOWATT-HOUR. source DLR, 2010.

98 RAGDEN, P ET AL., TECHNOLOGIES FOR CO2 CAPTURE AND STORAGE, FEDERALENVIRONMENTAL AGENCY: BERLIN, GERMANY, (2006).99 HEDDLE, G ET AL., THE ECONOMICS OF CO2 STORAGE, MIT, (AUGUST 2003).100 PARFOMAK, P & FOLGER, P, PIPELINES FOR CARBON DIOXIDE ( CO2) CONTROL: NETWORKNEEDS AND COST UNCERTAINTIES,U.S. CONGRESSIONAL RESEARCH SERVICES, (2008).101 RUBIN, E ET AL., “COMPARATIVE ASSESSMENTS OF FOSSIL FUEL POWER PLANTSWITH CO2 CAPTURE AND STORAGE” IN PROCEEDINGS OF THE 7TH INTERNATIONALCONFERENCE ON GREENHOUSE GAS CONTROL TECHNOLOGIES, VANCOUVER, CANADA,SEPTEMBER 5-9, 2004.

references94 GREENPEACE INTERNATIONAL, “CARBON CAPTURE AND STORAGE,’ BRIEFING, GOERNE 2007.95 ABANADES, J C ET AL.. SUMMARY FOR POLICYMAKERS IN IPCC SPECIAL REPORT ONCARBON DIOXIDE CAPTURE AND STORAGE, CAMBRIDGE UNIVERSITY PRESS: CAMBRIDGE,U.K., (2005).96 NATIONAL ENERGY TECHNOLOGY LABORATORIES, 2007.97 RUBIN, E ET AL., TECHNICAL SUMMARY IN IPCC SPECIAL REPORT ON CARBON DIOXIDECAPTURE AND STORAGE, CAMBRIDGE UNIVERSITY PRESS: CAMBRIDGE, U.K. (2005).

5

scenario

s for a

future en

ergy su

pply

|COST P

ROJE

CTIO

NS

© B. ERICKSON/DREAMSTIMEimage GEOTHERMAL POWER STATION,

NORTH ISLAND, NEW ZEALAND.

image GEOTHERMAL ACTIVITY.

© J. GOUGH/DREAMSTIME

56


5.5 cost projections for renewable energy technologies

The range of renewable energy technologies available today displaysmarked differences in terms of their technical maturity, costs, anddevelopment potential. Whereas hydro power has been widely used fordecades, other technologies, such as the gasification of biomass, haveyet to find their way to market maturity. Some renewable sources,including wind and solar power, by their very nature provide a variablesupply, requiring a revised coordination with the grid network. Butalthough in many cases these are “distributed” technologies—theiroutput being generated for and used locally by the consumer—thefuture will also see large-scale applications in the form of offshorewind parks, photovoltaic power plants or concentrating solar powerstations.

By using the individual advantages of the different technologies, andlinking them with each other, a wide spectrum of available options canbe developed to market-maturity and integrated step by step into theexisting supply structures. This will eventually provide acomplementary portfolio of environmentally friendly technologies forheat and power supply and the provision of transport fuels.

Many of the renewable technologies employed today are at a relativelyearly stage of market development. As a result, the costs of electricity,heat and fuel production are generally higher than those of competingconventional systems—a reminder that the external (environmental andsocial) costs of conventional power production are not included inmarket prices. It is expected, however, that compared with conventionaltechnologies, large cost reductions can be achieved through technicaladvances, manufacturing improvements and large-scale production.Especially when developing long-term scenarios spanning periods ofseveral decades, the dynamic trend of cost developments over timeplays a crucial role in identifying economically sensible expansionstrategies.

To identify long-term cost developments, learning curves have beenapplied which reflect the correlation between cumulative productionvolumes of a particular technology and a reduction in its costs. Formany technologies, the learning factor (or progress ratio) falls in therange between 0.75, for less mature systems, and 0.95 and higher, forwell-established technologies. A learning factor of 0.9 means thatcosts are expected to fall by 10% every time the cumulative outputfrom the technology doubles. Empirical data show, for example, thatthe learning factor for PV solar modules has been fairly constant at0.8 over 30 years, while that for wind energy varies from 0.75 in theUK to 0.94 in the more advanced German market.

Assumptions on future costs for renewable electricity technologies inthe Energy [R]evolution scenario are derived from a review oflearning-curve studies, for example by Lena Neij and others;102 theanalysis of recent technology foresight and road-mapping studies,including the European Commission–funded NEEDS project;103 theIEA Energy Technology Perspectives 2008; projections by theEuropean Renewable Energy Council published in April 2010 (“Re-Thinking 2050”); and discussions with experts from a wide range ofdifferent sectors of the renewable energy industry.

102 NEIJ, L, ‘COST DEVELOPMENT OF FUTURE TECHNOLOGIES FOR POWER GENERATION - ASTUDY BASED ON EXPERIENCE CURVES AND COMPLEMENTARY BOTTOM-UPASSESSMENTS’, ENERGY POLICY 36 (2008), 2200-2211.103 NEW ENERGY EXTERNALITIES DEVELOPMENTS FOR SUSTAINABILITY (NEEDS),ONLINE AT <WWW.NEEDS-PROJECT.ORG>.

2030

1,036

1,166

15

1,330

1,166

15

2040

1,915

891

12

2,959

864

12

2050

2,968

864

11

4,318

837

11

2020

335

2,016

18

439

2,016

18

2015

98

2,962

43

108

2,962

43

2007

6

4,252

75

6

4,252

75

table 5.4: photovoltaics (pv) cost assumptions

Energy [R]evolution

Global installed capacity (GW)

Investment costs (Can$/kWp)

Operation & maintenance costs (Can$/kW/a)

Advanced Energy [R]evolution




5

scenario

s for a

future en

ergy su

pply

|COST P

ROJE

CTIO

NS F

OR R

ENEW

ABLE T

ECHNOLOGIE

S

note GW = GIGAWATTS; KWP = KILOWATTS PHOTOVOLTAIC; KW/A = KILOWATTS PER ANNUM.

5.5.1 photovoltaics

The worldwide photovoltaics (PV) market has been growing at over40% per annum in recent years and the contribution it can make toelectricity generation is starting to become significant. Theimportance of photovoltaics comes from its decentralized/centralizedcharacter, its flexibility for use in an urban environment and its hugepotential for cost reduction. Development work is focused onimproving existing modules and system components by increasingtheir energy efficiency and reducing material usage. Technologies likePV thin film (using alternative semiconductor materials) or dye-sensitive solar cells are developing quickly and present a hugepotential for cost reduction. The mature technology known ascrystalline silicon, with a proven lifetime of 30 years, is continuallyincreasing its cell and module efficiency (by 0.5% annually), whilethe cell thickness is rapidly decreasing (from 230 to 180 micronsover the last five years). Commercial module efficiency varies from 14to 21%, depending on silicon quality and fabrication process.

The learning factor for PV modules has been fairly constant over thelast 30 years, with a cost reduction of 20% each time the installedcapacity doubles, indicating a high rate of technical learning.Assuming a globally installed capacity of 1,000 GW by between2030 and 2040 in the basic Energy [R]evolution scenario, and withan electricity output of 1,400 TWh/a , we can expect that generationcosts of around CA$0.06–0.11/kWh (depending on the region) will beachieved. During the following five to ten years, PV will becomecompetitive with retail electricity prices in many parts of the world,and competitive with fossil fuel costs by 2030. The advanced Energy[R]evolution version shows faster growth, with PV capacity reaching1,000 GW by 2025—five years ahead of the basic scenario.

5.5.2 concentrating solar power

“Concentrating” solar thermal power (CSP) stations can only usedirect sunlight and are therefore dependent on high-irradiationlocations. North Africa, for example, has a technical potential whichfar exceeds local demand. The various solar thermal technologies(parabolic trough, power towers, and parabolic dish concentrators)offer good prospects for further development and cost reductions.Because of their simpler design, “Fresnel” collectors are consideredan option for additional cost trimming. The efficiency of centralreceiver systems can be increased by producing compressed air at atemperature of up to 1,0000C, which is then used to run a combinedgas and steam turbine.

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

Depending on the level of irradiation and the mode of operation, it isexpected that long-term future electricity generation costs ofCA$0.07–0.11/kWh can be achieved. This presupposes rapid marketintroduction in the next few years.

57

© GP/MARTIN ZAKORA

image AERIAL VIEW OF THE WORLD’SLARGEST OFFSHORE WINDPARK IN THE NORTH SEA HORNS REV IN ESBJERG, DENMARK.

5.5.3 wind power

Within a short period of time, the dynamic development of windpower has resulted in the establishment of a flourishing globalmarket. While favourable policy incentives have made Europe themain driver for the global wind market, in 2009 more than threequarters of the annual capacity installed was outside Europe. Thistrend is likely to continue. The boom in demand for wind powertechnology has nonetheless led to supply constraints. As aconsequence, the cost of new systems has increased. However, becauseof the continuous expansion of production capacities, the industry isalready resolving the bottlenecks in the supply chain. Taking intoaccount market development projections, learning-curve analysis, andindustry expectations, we assume that investment costs for windturbines will be reduced by 30% for onshore and by 50% foroffshore installations up to 2050.

2030

324

4,839

204

605

4,767

204

2040

647

4,767

182

1,173

4,722

182

2050

1,002

4,722

176

1,643

4,677

176

2020

105

5,725

238

225

5,725

238

2015

25

6,329

284

28

6,329

284

2007

1

8,229

341

1

8,229

341

table 5.5: generation from csp, 2007–2050

Energy [R]evolution


Investment costs (Can$/kW)*




Investment costs (Can$/kW)*


2030

1,733

1,081

49

1,657

110

2241

1,029

49

1,657

110

2040

2,409

1,029

47

1,510

100

3054

1,015

47

1,510

100

2050

2,943

1,015

47

1,481

94

3754

1,001

47

1,481

94

2020

878

1,133

51

1,748

129

1140

1,133

51

1,748

129

2015

407

1,424

58

2,497

174

494

1,424

58

2,497

174

2007

95

1,714

66

3,292

188

95

1,714

66

3,292

188

table 5.6: generation from wind power, 2007–2050

Energy [R]evolution

Installed capacity (on+offshore)

Wind onshore


O&M costs (Can$/kW/a)

Wind offshore




Installed capacity (on+offshore)

Wind onshore



Wind offshore




5

scenario

s for a

future en

ergy su

pply

|COST P

ROJE

CTIO

NS F

OR R

ENEW

ABLE T

ECHNOLOGIE

S


58


5.5.4 biomass

The crucial factor for the economics of biomass utilization is the cost ofthe feedstock, which today ranges from a negative cost for waste wood(based on credit for waste disposal costs avoided) through inexpensiveresidual materials to the more-expensive energy crops. The resultingspectrum of energy generation costs is correspondingly broad. One of themost economic options is the use of waste wood in steam turbine combinedheat and power (CHP) plants. Gasification of solid biomass, on the otherhand, which opens up a wide range of applications, is still relativelyexpensive. In the long term, it is expected that favourable electricityproduction costs will be achieved by using wood gas both in micro–CHPunits (engines and fuel cells) and in gas-and-steam power plants. Greatpotential for the utilization of solid biomass also exists for heat generationin both small and large heating centres linked to local heating networks.Converting crops into ethanol and “biodiesel,” made from rapeseed methylester (RME), has become increasingly important in recent years; forexample, in Brazil, the US and Europe. Processes for obtaining syntheticfuels from biogenic synthesis gases will also play a larger role.

At the global level, the Energy [R]evolution scenario assumes roughly 88exajoules (EJ) of primary energy coming from biomass in 2050. Thebulk of this (75 EJ per year) is crop harvest residues (e.g., straw, stalkand leaves) and crop process residues (e.g., oilcakes, hulls and shells)and assumes that the majority (75%) of the crop harvest residues andtotal crop biomass will remain in the field for carbon and nutrientrecycling purposes. About 8–9 EJ per year will come from woodprocessing residues (e.g,. from sawmills) and discarded wood products.This equals 0.7–0.8 billion cubic metres of wood residues per year, or

less than half of today’s annual consumption of fuelwood. The remaining4–5 EJ per year will come from dedicated bioenergy crops, whichtranslates roughly to 10–15 million hectares of dedicated bioenergycropland needed. This is less than 1% of today’s global cropland andprobably less than today’s already existing bioenergy cropland. Pressureto expand croplands can also be eased through a shift to a less meat-intensive diet, particularly in the developed world.

A large potential for exploiting modern technologies exists in Latin andNorth America, Europe, and the countries of transition economies, eitherin stationary appliances or the transport sector. In the long term, Europeand the transition economies will realize 20–50% of the potential forbiomass from energy crops, while biomass use in all the other regions willhave to rely on forest residues, industrial wood waste, and straw. In LatinAmerica, North America and Africa in particular, an increasing residuepotential will be available.

In other regions, such as the Middle East and all Asian regions, increaseduse of biomass is restricted, either due to a generally low availability or toalready high traditional use. For the latter, using modern, more-efficienttechnologies will improve the sustainability of current usage and havepositive side effects, such as reducing indoor pollution and the heavyworkloads currently associated with traditional biomass use.

5.5.5 geothermal

Geothermal energy has long been used worldwide for supplying heat,and since the beginning of the last century for electricity generation.Geothermally generated electricity was previously limited to sites with

2030

75

2,698

168

261

3,689

268

78

2,698

168

265

3,689

268

2040

87

2,666

167

413

3,400

247

83

2,666

167

418

3,400

247

2050

107

2,640

166

545

3,230

235

81

2,640

166

540

3,230

235

2020

62

2,764

173

150

4,224

308

64

2,764

173

150

4,224

308

2015

48

2,783

188

67

4,829

395

50

2,783

188

65

4,829

395

2007

28

3,198

208

18

5,959

459

28

3,198

208

18

5,959

459

table 5.7: biomass cost assumptions

Energy [R]evolution

Biomass (electricity only)


Investment costs (Can$/kW)


Biomass (CHP)





Biomass (electricity only)




Biomass (CHP)




2030

71

8,229

426

37

8,503

334

191

5,897

426

47

8,503

334

2040

114

6,857

398

83

7,132

291

337

5,072

398

132

7,132

291

2050

144

5,897

377

134

6,172

264

459

4,362

377

234

6,172

264

2020

36

10,423

486

13

10,698

398

57

10,423

486

13

10,698

398

2015

19

12,343

632

3

12,618

548

21

12,343

632

3

12,618

548

2007

10

14,126

732

1

14,401

734

10

14,126

732

0

14,401

734

table 5.8: geothermal cost assumptions

Energy [R]evolution

Geothermal (electricity only)




Geothermal (CHP)





Geothermal (electricity only)




Geothermal (CHP)




5

scenario

s for a

future en

ergy su

pply

|COST P

ROJE

CTIO

NS F

OR R

ENEW

ABLE T

ECHNOLOGIE

S

note GW = GIGAWATTS; KWP = KILOWATTS PHOTOVOLTAIC; KW/A = KILOWATTS PER ANNUM;CHP = COMBINED HEAT AND POWER.

note GW = GIGAWATTS; KWP = KILOWATTS PHOTOVOLTAIC; KW/A = KILOWATTS PER ANNUM;CHP = COMBINED HEAT AND POWER.

specific geological conditions, but further intensive research anddevelopment work has enabled the potential areas to be widened. Inparticular, the creation of large, underground heat-exchange surfaces—enhanced geothermal systems (EGSs)—and the improvement of low-temperature power conversion (for example, with the organic Rankinecycle) open up the possibility of producing geothermal electricityanywhere. Advanced heat and power cogeneration plants will alsoimprove the economics of geothermal electricity.

As a large part of the costs for a geothermal power plant comes fromdeep underground drilling, further development of innovative drillingtechnology is expected. Assuming a global average market growth forgeothermal power capacity of 9% per year up to 2020, and adjustingto 4% beyond 2030, the result would be a cost reduction potential of50% by 2050:

• For conventional geothermal power, the price would drop fromCA$0.08/kWh to about CA$0.03/kWh.

• For EGS, despite its presently high figures (about CA$0.20/kWh),and depending on the payments for heat supply, electricityproduction costs are expected to come down to aroundCA$0.06/kWh in the long term.

Because of its non-fluctuating supply and a grid load operating almost100% of the time, geothermal energy is considered to be a key elementin a future supply structure based on renewable sources. Up to now wehave only used a marginal part of the potential. Shallow geothermaldrilling, for example, makes possible the delivery of heating and coolingat any time anywhere, and can be used for thermal energy storage.

5.5.6 ocean energy

Ocean energy, particularly offshore wave energy, is a significantresource, and has the potential to satisfy an important percentage ofelectricity supply worldwide. Globally, the potential of ocean energy hasbeen estimated at around 90,000 terawatt-hours (TWh) /year. The mostsignificant advantages are the vast availability and high predictability of

59


image A COW INFRONT OF ABIOREACTOR IN THE BIOENERGYVILLAGE OF JUEHNDE. IT IS THE FIRSTCOMMUNITY IN GERMANY THATPRODUCES ALL OF ITS ENERGY NEEDEDFOR HEATING AND ELECTRICITY, WITHCO2 NEUTRAL BIOMASS.

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 boththermal and saline gradient resources. Many of these are in anadvanced phase of research and development (R&D), large-scaleprototypes have been deployed in real sea conditions and some havereached pre-market deployment. There are a few grid-connected, fullyoperational commercial wave and tidal generating plants.

The cost of energy from initial tidal and wave energy farms has beenestimated to be in the range of €0.15–0.55/kWh, and for initial tidalstream farms in the range of CA$0.12–0.25/kWh. Generation costs of€0.10–0.25/kWh are expected by 2020. Key areas for development willinclude concept design, optimization of the device configuration, reductionof capital costs by exploring the use of alternative structural materials,economies of scale, and learning from operation. According to the latestresearch findings, the learning factor is estimated to be 10–15% foroffshore wave and 5–10% for tidal stream. In the medium term, oceanenergy has the potential to become one of the most competitive and cost-effective forms of generation. In the next few years a dynamic marketpenetration is expected, following a similar curve to that of wind energy.

Because of the early development stage, any future cost estimates forocean energy systems are uncertain. Present cost estimates are basedon analysis from the European NEEDS project.104

5.5.7 hydro power

Hydropower is a mature technology with a significant part of its globalresource already exploited. There is still, however, some potential leftboth for new schemes (especially small-scale, run-of-river projects withlittle or no reservoir impoundment) and for repowering of existing sites.The significance of hydropower is also likely to be encouraged by theincreasing need for flood control and the maintenance of water supplyduring dry periods. The future is in sustainable hydropower, which makesan effort to integrate plants with river ecosystems while reconcilingecology with economically attractive power generation.

2030

73

2,449

101

180

2,045

101

2040

168

2,045

85

425

1,821

85

2050

303

1,821

75

748

1,622

75

2020

29

3,185

133

58

3,185

133

2015

9

4,417

235

9

4,417

235

2007

0

8,190

409

0

8,190

409

table 5.9: ocean energy cost assumptions

Energy [R]evolution








2030

1,307

3,501

145

1,316

3,501

145

2040

1,387

3,628

151

1,406

3,628

151

2050

1,438

3,739

155

1,451

3,739

155

2020

1,206

3,351

140

1,212

3,351

140

2015

1,043

3,250

131

1,111

3,250

131

2007

922

3,070

125

922

3,070

125

table 5.10: hydro power cost assumptions

Energy [R]evolution








104 NEW ENERGY EXTERNALITIES DEVELOPMENTS FOR SUSTAINABILITY (NEEDS),ONLINE AT <WWW.NEEDS-PROJECT.ORG>.

5

scenario

s for a

future en

ergy su

pply

|COST P

ROJE

CTIO

NS F

OR R

ENEW

ABLE T

ECHNOLOGIE

S

note GW = GIGAWATTS; KWP = KILOWATTS PHOTOVOLTAIC; KW/A = KILOWATTS PER ANNUM. note GW = GIGAWATTS; KWP = KILOWATTS PHOTOVOLTAIC; KW/A = KILOWATTS PER ANNUM.

120

100

80

60

40

20

% 0

figure 5.1: future development of investment costs(NORMALIZED TO CURRENT COST LEVELS) FOR RENEWABLE ENERGY

TECHNOLOGIES

2005 2010 2020 2030 2040 2050

•PV

•WIND ONSHORE

•WIND OFFSHORE

• BIOMASS POWER PLANT

• BIOMASS CHP

• GEOTHERMAL CHP

• CONCENTRATING SOLAR THERMAL

• OCEAN ENERGY

• PV

•WIND

• BIOMASS CHP

• GEOTHERMAL CHP

• CONCENTRATING SOLAR THERMAL

40

35

30

25

20

15

10

5

ct/kWh 0

figure 5.2: expected development of electricity generationcosts from fossil fuel and renewable options EXAMPLE FOR OECD NORTH AMERICA

2005 2010 2020 2030 2040 2050

47 HERZOG ET AL., 2005; BARKER ET AL., 2007.48 VAN VUUREN ET AL.; HOURCADE ET AL., 2006.

5.5.9 Assumed growth rates in different scenarios

In scientific literature,105 quantitative scenario modelling approaches arebroadly separated into two groups: “top-down” and “bottom-up”models. While this classification might have made sense in the past, it isless appropriate today, since the transition between the two categoriesis continuous, and many models, while being rooted in one of the twotraditions—macro-economic or energy-engineering—incorporateaspects from the other approach and thus belong to the class of so-called hybrid models.106 In the energy-economic modelling community,macro-economic approaches are traditionally classified as top-downmodels and energy-engineering models as bottom-up. The Energy[R]evolution scenario is a bottom-up (technology-driven) scenario andthe assumed growth rates for renewable energy technology deploymentare important drivers.

Around the world, however, energy modelling scenario tools are underconstant development and in the future both approaches are likely tomerge into one, with detailed tools employing both a high level oftechnical detail and economic optimisation. To reach the figures seenin Table 5.11, the Energy [R]evolution scenarios use a classicalbottom-up model which has been continuously developed and nowincludes calculations covering both the investment pathway and theemployment effect (see Chapter 7).

5.5.8 Summary of renewable energy cost development

Figure 5.1 summarizes the cost trends for renewable energytechnologies as derived from the respective learning curves. It shouldbe emphasized that the expected cost reduction is basically not afunction of time, but of cumulative capacity, so dynamic marketdevelopment is required. Most of the technologies will be able toreduce their specific investment costs to between 30% and 70% ofcurrent levels by 2020, and to between 20% and 60% once theyhave achieved full maturity (after 2040).

Reduced investment costs for renewable energy technologies leaddirectly to reduced heat and electricity generation costs, as shown inFigure 5.2. Generation costs today are around CA$0.09–0.28/kWhfor the most important technologies, with the exception ofphotovoltaics. In the long term, costs are expected to converge ataround CA$0.05–0.11/kWh. These estimates depend on site-specificconditions such as the local wind regime or solar irradiation, theavailability of biomass at reasonable prices, or the credit granted forheat supply, in the case of combined heat and power generation.

60


5

scenario

s for a

future en

ergy su

pply

|COST P

ROJE

CTIO

NS F

OR R

ENEW

ABLE T

ECHNOLOGIE

S

note PV = PHOTOVOLTAICS; CHP = COMBINED HEAT AND POWER.

note CT/KWH = CENTS PER KILOWATT-HOUR; PV = PHOTOVOLTAICS; CHP = COMBINED HEATAND POWER.

61

table 5.11: assumed annual average growth rates for renewable technologies

ADV E[R]

25,91930,90143,922

5941,9536,846689

2,7349,012

2,8495,87210,841

3671,2752,968

66251

1,263

392481580742

1,4242,991

119420

1,943

4,0594,4165,108

E[R]

25,85130,13337,993

4371,4814,597321

1,4475,917

2,1684,5398,474

235502

1,00965192719

373456717739

1,4023,013

53128678

4,0294,3705,056

REF

27,24834,30746,542

10828164038121254

1,0091,5362,516

1171682656919

337552994186287483

31125

4,0274,6795,963

GENERATION (TWh/a)

ENERGY PARAMETERTECHNOLOGY

ADV E[R]

42%14%15%62%17%14%

26%8%7%

20%15%10% 47%16%20%

10%2%2%19%8%9%

70%15%19%

2%1%2%

E[R]

37%15%13%49%18%17%

22%9%7%

14%9%8%47%13%16%

9%2%5%19%7%9%

55%10%20%

2%1%2%

REF

17%11%10%17%14%9%

12%5%6%

6%4%5%13%5%9%

8%6%7%2%5%6%

15%13%10%

2%2%3%

REF

202020302050

SolarPV-2020PV-2030PV-2050CSP-2020CSP-2030CSP-2050

WindOn+Offshore-2020On+Offshore-2030On+Offshore-2050

Geothermal2020 (power generation)2030 (power generation)2050 (power generation)2020 (heat&power)2030 (heat&power)2050 (heat&power)

Bioenergy2020 (power generation)2030 (power generation)2050 (power generation)2020 (heat&power)2030 (heat&power)2050 (heat&power)

Ocean202020302050

Hydro2020 2030 2050

image CONSTRUCTION OF WIND TURBINES.


5

scenario

s for a

future en

ergy su

pply

|COST P

ROJE

CTIO

NS F

OR R

ENEW

ABLE T

ECHNOLOGIE

S

note TWH/A = TERAWATT HOURS PER ANNUM; PV = PHOTOVOLTAICS; CSP = CONCENTRATING SOLAR POWER.

62


EMISSIONS

LEGEND

REFERENCE SCENARIO

ADVANCED ENERGY [R]EVOLUTION SCENARIO

REF

E[R]

0 1000 KM

EMISSIONS TOTALMILLION TONNES [mio t] | % OF 1990 EMISSIONS

EMISSIONS PER PERSON TONNES [t]

H HIGHEST | M MIDDLE | L LOWEST

CO2

100-75 75-50 50-25

25-0 % OF 1990 EMISSIONS INTHE 2050 ADVANCEDENERGY [R]EVOLUTIONSCENARIO

CO2

mio t %

OECD NORTH AMERICA

2007

2050

6,686H

6,822

165

169

2007

2050

14.89H

11.82H

mio t %

6,686

215M

165

5

14.89

0.37

t t

REF E[R]

CO2

mio t %

LATIN AMERICA

2007

2050

1,010

2,006

167M

332M

2007

2050

2.18

3.34

mio t %

1,010

119L

167

20

2.18

0.20L

t t

REF E[R]

CO2

map 5.1: CO2 emissions reference scenario and the advanced energy [r]evolution scenarioWORLDWIDE SCENARIO

5

scenario

s for a

future en

ergy su

pply

|CO

2EM

ISSIO

NS

63

mio t %

AFRICA

2007

2050

881L

1,622L

161

297

2007

2050

0.91L

0.81L

mio t %

881

423

161

77

0.91

0.21

t t

REF E[R]

CO2

mio t %

INDIA

2007

2050

1,307

5,110

222

868

2007

2050

1.12

3.17

mio t %

1,307

449

222

85

1.12

0.31

t t

REF E[R]

CO2

mio t %

DEVELOPING ASIA

2007

2050

1,488

3,846M

216

557

2007

2050

1.47

2.54

mio t %

1,488

428

216

62

1.47

0.28

t t

REF E[R]

CO2

mio t %

OECD PACIFIC

2007

2050

2,144

1,822

136

116

2007

2050

10.70

10.14

mio t %

2,144

74

136

5

10.70

0.41M

t t

REF E[R]

CO2

mio t %

GLOBAL

2007

2050

27,408

44,259

131

211

2007

2050

4.1

4.8

mio t %

27,408

3,267

131

16

4.1

0.4

t t

REF E[R]

CO2

mio t %

TRANSITION ECONOMIES

2007

2050

2,650

3,564

66

88

2007

2050

7.79

11.47

mio t %

2,650

258

66

6

7.79

0.83H

t t

REF E[R]

CO2

mio t %

CHINA

2007

2050

5,852

12,460H

261

555

2007

2050

4.38

8.74

mio t %

5,852

925H

261

41

4.38

0.65

t t

REF E[R]

CO2

mio t %

OECD EUROPE

2007

2050

4,017M

3,798

100

94

2007

2050

7.44

6.61M

mio t %

4,017

215

100

5

7.44

0.36

t t

REF E[R]

CO2

DESIGN WWW.ONEHEMISPHERE.SE CONCEPT SVEN TESKE/GREENPEACE INTERNATIONAL.

mio t %

MIDDLE EAST

2007

2050

1,374

3,208

234

546

2007

2050

6.79M

9.08

mio t %

1,374

122

234

21

6.79

0.35

t t

REF E[R]

CO2

5

scenario

s for a

future en

ergy su

pply

|CO

2EM

ISSIO

NS

64


map 5.2: results reference scenario and the advanced energy [r]evolution scenarioWORLDWIDE SCENARIO

SCENARIO

LEGEND

REFERENCE SCENARIO


REF

E[R]

0 1000 KM

SHARE OF RENEWABLES %

SHARE OF FOSSIL FUELS %

SHARE OF NUCLEAR ENERGY %

H HIGHEST | M MIDDLE | L LOWESTPE PRIMARY ENERGY PRODUCTION/DEMAND IN PETA JOULE [PJ]

EL ELECTRICITY PRODUCTION/GENERATION IN TERAWATT HOURS [TWh]

RESULTS> -50 > -40 > -30

> -20 > -10 > 0

> +10 > +20 > +30

> +40 > +50 % CHANGE OF ENERGYCONSUMPTION IN THE ADVANCEDENERGY [R]EVOLUTION SCENARIO2050 COMPARED TO CURRENTCONSUMPTION 2007

PE PJ EL TWh

OECD NORTH AMERICA

2007

2050

115,758H

129,374

5,221H

7,917

2007

2050

7

15

15

25

PE PJ EL TWh

115,758H

70,227

5,221

7,925

15

98

7

85

% %

2007

2050

85

75

85

9

67M

59M

67M

2

18

16

% %

2007

2050

8

10

NUCLEAR POWERPHASED OUT BY 2040

% %

REF E[R]

PE PJ EL TWh

LATIN AMERICA

2007

2050

22,513L

40,874

998

2,480

2007

2050

29

28

70H

57H

PE PJ EL TWh

22,513L

27,311

998

2,927

70H

98

29

88H

% %

2007

2050

70L

69

70L

12L

28L

40L

28L

2

2

2

% %

2007

2050

1

3


% %

REF E[R]

5

scenario

s for a

future en

ergy su

pply

|RESULT

S

65

PE PJ EL TWh

AFRICA

2007

2050

26,355

43,173

615L

1,826L

2007

2050

48H

45H

16

36

PE PJ EL TWh

26,355

35,805

615L

2,490L

16

94

48H

79M

% %

2007

2050

51

54L

51

20M

82

62

82

6

2

2

% %

2007

2050

0L

0L


% %

REF E[R]

PE PJ EL TWh

INDIA

2007

2050

25,159

77,7610M

814

4,918

2007

2050

29

13

17

12

PE PJ EL TWh

25,159

52,120

814

5,062

17

93L

29

78

% %

2007

2050

70

84

70

22

81

85

81

7

2

3

% %

2007

2050

1

3


% %

REF E[R]

PE PJ EL TWh

DEVELOPING ASIA

2007

2050

31,903

69,233

978

3,721

2007

2050

27

19

16

21

PE PJ EL TWh

31,903

40,639

978

3,548

16

94

27

73L

% %

2007

2050

72

79

72

27

79

77

79

6

5M

2

% %

2007

2050

1

2


% %

REF E[R]

PE PJ EL TWh

OECD PACIFIC

2007

2050

37,588

40,793

1,851M

2,626

2007

2050

4

10

8

16

PE PJ EL TWh

37,588

21,299L

1,851M

2,322

8

98M

4

84

% %

2007

2050

84

66

84

16

70

51

70

2M

22

33H

% %

2007

2050

12H

24H


% %

REF E[R]

PE PJ EL TWh

GLOBAL

2007

2050

490,229

783,458

19,773

46,542

2007

2050

13

15

18

24

PE PJ EL TWh

490,229

480,861

19,773

43,922

18

95

13

80

% %

2007

2050

81

79

81

20

68

67

68

5

14

10

% %

2007

2050

6

6


% %

REF E[R]

PE PJ EL TWh


2007

2050

48,111M

64,449

1,685

3,110

2007

2050

4

7

17M

22M

PE PJ EL TWh

48,111M

34,710

1,685

2,438

17M

93

4

76

% %

2007

2050

89

85

89

24

65

63

65

7

17

15

% %

2007

2050

7M

8


% %

REF E[R]

PE PJ EL TWh

CHINA

2007

2050

83,922

183,886H

3,319

12,188H

2007

2050

12M

10

15

18

PE PJ EL TWh

83,922

107,104H

3,319

10,190H

15

90

12M

77L

% %

2007

2050

87

85

87

23H

83

75

83

10H

2

7

% %

2007

2050

1

5


% %

REF E[R]

DESIGN WWW.ONEHEMISPHERE.SE CONCEPT SVEN TESKE/GREENPEACE INTERNATIONAL.

PE PJ EL TWh

OECD EUROPE

2007

2050

79,599

82,634

3,576

5,351

2007

2050

10

21

20

42

PE PJ EL TWh

79,599

46,754

3,576

4,233

20

97

10

85

% %

2007

2050

77

71

77

16

54

46

54

2

26H

12

% %

2007

2050

13

8


% %

REF E[R]

PE PJ EL TWh

MIDDLE EAST

2007

2050

21,372

51,281

715

2,404

2007

2050

1L

2L

3

7

PE PJ EL TWh

21,372

27,475

715

2,786L

3L

99H

1L

76

% %

2007

2050

99H

97H

99H

23

97

92

97H

1L

0

0

% %

2007

2050

0L

0L

NO NUCLEARENERGYDEVELOPMENT

% %

REF E[R]

5

scenario

s for a

future en

ergy su

pply

|RESULT

S

66

6key results: the canadian energy [r]evolution scenario

CANADA CANADIAN ENERGY DEMAND TO 2050ELECTRICITY GENERATIONFUTURE COSTS OF ELECTRICITYGENERATION

FUTURE EMPLOYMENTHEATING AND COOLING SUPPLYTRANSPORTCANADA’S CO2 EMISSIONS

CANADA’S PRIMARY ENERGYCONSUMPTIONFUTURE INVESTMENT

“We need staggeringamounts of energyconservation, emissionscuts and renewable energy.And all need to be deployedat an unprecedented rate.”DR. ANDREW WEAVERIPCC SCIENTIST AND CANADA RESEARCH CHAIR IN CLIMATE MODELLING AND ANALYSIS UNIVERSITY OF VICTORIA

imageSOLAR PANEL. © BERND JUERGENS/DREAMSTIME

67

key resu

lts|

CANADIA

N E

NERGY D

EM

AND T

O 2

050

© ANNA RZEPKOWSKA/ISTOCK

© PGIAM/ISTOCK

image SOLAR PANEL ON MEDIA ADVERTISING, VANCOUVER, BC, CANADA.

image WIND TURBINES UNDER THE SUN, ONTARIO, CANADA.

6.1 canadian energy demand to 2050

Combining the projections on population development, GDP growth,and energy intensity results in future development pathways forCanada’s final energy demand. These are shown in Figure 6.1 for theReference and both Energy [R]evolution scenarios. Under the Referencescenario, final energy demand (without non-energy use) increases by28% from the current 7,614 petajoules per annum (PJ/a) to 9,746PJ/a in 2050. In the Energy [R]evolution scenario, final energy demanddecreases by 44% compared to current consumption and is expected toreach 4,280 PJ/a by 2050.

Under the basic Energy [R]evolution scenario electricity demand isexpected to decrease in the industry sector, stay steady in theresidential and service sectors, but to grow in the transport sector (seeFigure 6.2). Total electricity demand will rise from 1,830 PJ/a to1,943 PJ/a by the year 2050. Compared to the Reference scenario,efficiency measures avoid the generation of about 996 PJ/a. Thisreduction can be achieved in particular by introducing highly efficientelectronic devices using the best available technology in all demandsectors. In the Advanced Energy [R]evolution scenario, total electricitydemand is even higher at 2,113 PJ/a due to a greater reliance onelectricity for use in transport.

Efficiency gains in the heat supply sector are even larger. Under thebasic Energy [R]evolution scenario demand for heat supplyconstantly decreases through 2050 (see Figure 6.3). Compared tothe Reference scenario, consumption equivalent to 2,094 PJ/a isavoided through efficiency gains by 2050 in both Energy[R]evolution scenarios. As a result of energy-related renovation ofthe existing stock of residential buildings, as well as theintroduction of low-energy standards and of “passive houses” fornew buildings, enjoyment of the same comfort and energy serviceswill be accompanied by a much lower future energy demand

In the transport sector, it is assumed under the Energy[R]evolution scenarios that energy demand will decrease by 48%relative to current levels by 2050. This is 56% lower than whatwould happen to transport energy demand by 2050 in theReference scenario. This reduction can be achieved by theintroduction of highly efficient vehicles; by shifting the transportof goods from road to rail; and by changes in mobility-relatedbehaviour patterns. The Advanced Energy [R]evolution scenariohas a higher share of electric drives, further reducing greenhousegas emissions.

figure 6.1: projection of final energy demand in canada to 2050, by sector, under three scenarios

•‘EFFICIENCY’

• OTHER SECTORS

• INDUSTRY

•TRANSPORTPJ/a 0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

9,000

10,000

REF E[R]

2007

adv E[R]

REF E[R]

2015

adv E[R]

REF E[R]

2020

adv E[R]

REF E[R]

2030

adv E[R]

REF E[R]

2040

adv E[R]

REF E[R]

2050

adv E[R]

68

6

key resu

lts|

ELECTRIC

ITY G

ENERATIO

N


PJ/a 0

500

1,000

1,500

2,000

2,500

3,000

3,500

E[R]

2007

advE[R]

E[R]

2010

advE[R]

E[R]

2020

advE[R]

E[R]

2030

advE[R]

E[R]

2040

advE[R]

E[R]

2050

advE[R]

PJ/a 0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

E[R]

2007

advE[R]

E[R]

2010

advE[R]

E[R]

2020

advE[R]

E[R]

2030

advE[R]

E[R]

2040

advE[R]

E[R]

2050

advE[R]

figure 6.2: development of electricity demand in canada to2050, by sector, under three scenarios

figure 6.3: development of heat demand in canada to2050, by sector, under three scenarios

•‘EFFICIENCY’

• OTHER SECTORS

• INDUSTRY

•TRANSPORT

• ‘EFFICIENCY’

• OTHER SECTORS

• INDUSTRY

6.2 electricity generation

The development of the electricity supply sector is characterized by adynamically growing renewable energy market and an increasingshare of renewable electricity. This will compensate for the phasing-out of nuclear energy and reduce the number of fossil fuel–firedpower plants required for grid stabilization.

By 2050, in the basic Energy [R]evolution scenario, 95% of theelectricity produced in Canada will come from renewable energysources. “New” renewables—mainly wind, solar photovoltaic (PV)—will contribute over 19% of electricity generation. Under theAdvanced Energy [R]evolution scenario, this will not increasesignificantly: 78% by 2030 and 96% by 2050 will come fromrenewables. However, the overall installed capacity of renewablegeneration will be higher under the Advanced Energy [R]evolutionscenario (191 GW) than under the Energy [R]evolution scenario.

Table 6.1 shows the comparative evolution of different renewablestechnologies over time. Until 2030, hydro power and wind will remainthe main contributors. After 2020, the continuing growth of wind willbe complemented by electricity from sustainably-produced biomass,photovoltaic and ocean energy.

table 6.1: projection of renewable electricity capacityin canada under both energy [r]evolution scenariosIN GW

2020

82

89

4

2

10

19

0

1

3

3

0

0

3

3

101

116

2040

87

100

5

4

32

48

0

2

6

6

0

0

10

15

141

175

2050

93

100

8

6

38

54

0

3

7

7

0

0

14

20

160

190

Hydro

Biomass

Wind

Geothermal

PV

CSP

Ocean energy

Total

E[R]

advanced E[R]

E[R]

advanced E[R]

E[R]

advanced E[R]

E[R]

advanced E[R]

E[R]

advanced E[R]

E[R]

advanced E[R]

E[R]

advanced E[R]

E[R]

advanced E[R]

2030

94

94

5

3

20

33

0

1

5

5

0

0

6

7

119

142

2007

77

77

2

2

2

2

0

0

0

0

0

0

0

0

81

81

69

key resu

lts|

FUTURE C

OSTS O

F E

LECTRIC

ITY G

ENERATIO

N

© ANDREW WRIGHT / GP

© F LARIVIERE/DREAMSTIME.COM

image HIGH VOLTATE STEEL PYLONS, CANADA.

image WATERFALL IN THE GREAT BEAR RAINFOREST, IN BRITISHCOLUMBIA, CANADA.

figure 6.4: development of electricity generation structure in canada to 2050, under three scenarios (REFERENCE, ENERGY [R]EVOLUTION AND ADVANCED ENERGY [R]EVOLUTION) [“EFFICIENCY” = REDUCTION COMPARED TO THE REFERENCE SCENARIO]

TWh/a 0

100

200

300

400

500

600

700

800

900

1,000

1,100

REF E[R]

2007

adv E[R]

REF E[R]

2015

adv E[R]

REF E[R]

2020

adv E[R]

REF E[R]

2030

adv E[R]

REF E[R]

2040

adv E[R]

REF E[R]

2050

adv E[R]

•‘EFFICIENCY’

• OCEAN ENERGY

• SOLAR THERMAL

• GEOTHERMAL

• BIOMASS

• PV

•WIND

• HYDRO

• DIESEL

• OIL

• NATURAL GAS

• LIGNITE

• COAL

• NUCLEAR

6.3 future costs of electricity generation

Under the Reference scenario, the unchecked growth in electricitydemand, the increase in fossil fuel prices and the cost of CO2

emissions result in total electricity supply costs rising from CA$37 billion in 2007 to CA$92 billion in 2050, as shown in Figure6.5. The Energy [R]evolution scenarios not only dramatically reducegreenhouse gases, but also help to stabilize energy costs and relieveeconomic pressure on society. Increasing energy efficiency andshifting energy supply to renewables result in long-term costs forelectricity supply that are 45% lower in the Advanced Energy[R]evolution scenario and 50% lower in the Energy [R]evolutionscenario. The higher total cost of the Advanced Energy [R]evolutionscenario, as compared to the basic Energy [R]evolution scenario,results from a higher requirement for electricity due to the increasingelectrification of the transport and heating sectors.

Figure 6.6 shows that the introduction of renewable technologiesunder the Energy [R]evolution scenario has slightly higher specificcosts for electricity generation, compared to those under theReference scenario, until 2045. The Advanced Energy [R]evolutionscenario has slightly higher specific costs until 2035. The lower costsseen under the Energy [R]evolution scenarios are due to the reducedCO2 intensity of electricity generation and the related costs foremission allowances, as well as to better economies of scale in theproduction of renewable power equipment.

In 2050, specific costs (for both generation and efficiency measures)will amount to 7.0 cents/kWh in the Advanced Energy [R]evolutionscenario; 7.2 cents/kWh in the Energy [R]evolution scenario; and10.2 cents/kWh in the Reference scenario.

figure 6.5: development of total electricity generationcosts & development of specific electricity generationcosts to 2050, under three scenarios

0

2

4

6

8

10

12

0

10

20

30

40

50

60

70

80

90

100

110

2007 2015 2020 2030 2040 2050

B $/a $¢/kWh

•ENERGY [R]EVOLUTION - ‘EFFICIENCY’ MEASURES

• REFERENCE SCENARIO

• ENERGY [R]EVOLUTION SCENARIO

• ADVANCED ENERGY [R]EVOLUTION SCENARIO

70

6

key resu

lts|

FUTURE E

MPLOYM

ENT &

HEATIN

G A

ND C

OOLIN

G S

UPPLY


6.4 future employment

The Energy [R]evolution scenarios lead to more electricity sector jobsin Canada at every stage.

• Renewable power sector jobs in the Advanced Energy [R]evolutionscenario are estimated to reach about 67,000 by 2015—29,000more than in the Reference scenario. The basic scenario will lead to52,000 jobs in the renewable power industry by the same year.

• By 2030, the Advanced Energy [R]evolution scenario has createdabout 72,000 jobs in the renewable power industry, 24,000 morethan the Reference scenario. Approximately 12,000 new power sectorjobs are created between 2015 and 2030, compared to in theReference scenario.

Table 6.2 shows the increase in job numbers under both Energy[R]evolution scenarios, for each technology, up to 2030. Both scenariosshow losses in coal generation, but these are outweighed byemployment growth in renewable technologies and gas. Wind showsparticularly strong growth in both Energy [R]evolution scenarios by2020, but by 2030 there is significant employment across a range ofrenewable technologies. In both Energy [R]evolution scenarios,renewable power jobs reach over 70% of total energy sector jobs by2020, with a share of over 80% by 2030.

table 6.2: employment and investment in canada to 2030, under three scenarios

2015

30,308

9,713

31,718

16,400

16,004

104,142

4,386

30,221

2,123

67,411

104,142

2020

17,113

5,691

39,013

17,290

12,047

91,153

2,916

26,509

502

61,226

91,153

2030

16,173

6,247

48,772

17,885

7,887

96,964

1,797

23,054

0

72,113

96,964

Jobs

Construction & installation

Manufacturing

Operations & maintenance

Fuel

Coal and gas export

Total Jobs

Coal

Gas, oil and diesel

Nuclear

Renewables

Total Jobs

ADVANCED ENERGY [R]EVOLUTION

2015

20,636

3,977

32,671

17,911

16,573

91,768

4,857

32,628

2,123

52,161

91,768

2020

11,601

4,231

38,414

21,762

13,999

90,007

3,524

31,310

502

54,671

90,007

2030

10,873

4,869

46,376

23,981

10,095

96,195

2,049

29,659

0

64,487

96,195

ENERGY [R]EVOLUTION

2015

10,888

4,944

32,232

12,925

13,467

74,456

7,590

21,670

6,519

38,677

74,456

2020

13,772

3,205

36,817

14,174

10,365

78,333

8,845

19,651

8,041

41,797

78,333

2030

10,992

3,361

43,921

16,977

9,591

84,843

6,973

20,888

8,929

48,053

84,843

REFERENCE

6.5 heating and cooling supply

In 2007, renewables met 11% of Canada’s primary energy demandfor heat supply, the main contribution coming from the use of biomass(see Figure 6.6). The lack of district heating networks is a severestructural barrier to the large-scale utilization of geothermal andsolar thermal energy. Incentives and regulatory support will berequired to ensure their development.

Under the Energy [R]evolution scenarios, there is a dramatic growth inefficiency and renewable energy for heating and cooling in Canada,along with a corresponding reduction in the use of fossil fuels:

• Renewable technologies provide 76% of Canada’s total heatingdemand by 2050 in the basic E[R] scenario, and this figure rises to 92%in the Advanced scenario, due to a greater use of geothermal energy.

• Energy efficiency measures reduce the currently growing demand forheating and cooling, despite the improvement of living standards.

• In the industrial sector, solar thermal systems, sustainablebiomass/biogas, and geothermal energy are increasingly substituted forconventional fossil-fuelled heating systems.

• In the industrial sector, solar thermal systems, sustainablebiomass/biogas, and geothermal energy are increasingly substituted forconventional fossil-fuelled heating systems.

• A shift from coal and oil to natural gas in the remaining conventionalapplications leads to a further reduction of CO2 emissions

As can be seen in Figure 6.6, the basic Energy [R]evolution scenario saves2,094 PJ/a by 2050, or 56%, compared to the Reference scenario. TheAdvanced scenario introduces renewable heating systems about five yearsahead of the Energy [R]evolution scenario. Solar collectors and geothermalheating systems achieve economies of scale through ambitious supportprogrammes five to ten years earlier. This results in a renewable energyshare of 40% by 2030 and 92% by 2050.

71

key resu

lts|

TRANSPORT

© JIRI REZAC / GREENPEACE

© JIRI REZAC / GREENPEACEimage LOGS FROM CLEARCUTS IN

ALBERTA TAR SANDS.

image AERIAL VIEW OF A TAILINGSPIPE AT THE SYNCRUDE UPGRADERPLANT AND TAILINGS POND IN THEBOREAL FOREST NORTH OF FORTMCMURRAY, ALBERTA.

6.6 transport

A key target in Canada is to introduce incentives for smaller and moreefficient cars. It is also vital to achieve a shift to efficient transportationmodes such as rail, light rail, and buses—especially in the large,expanding metropolitan areas. Together with rising prices for fossil fuels,these changes will reduce energy demand in the transportation sector by48% under the Energy [R]evolution scenarios.

Highly efficient propulsion technology for hybrid, plug-in hybrid andbattery-electric power trains will bring large efficiency gains. By2030, electricity will provide 17% of the transport sector’s totalenergy demand in the basic Energy [R]evolution scenario, while in theAdvanced Energy [R]evolution scenario the share will reach 24% in2030 and 60% in 2050.

figure 6.7: energy for transportation in canada, to 2050,under three scenarios

PJ/a 0250500750

1,0001,2501,5001,7502,0002,2502,5002,7503,000

2007 2015 2020 2030 2040 2050

REF E[R] adv E[R]

REF E[R] adv E[R]

REF E[R] advE[R]

REF E[R] advE[R]

REF E[R] advE[R]

RE F E[R] advE[R]

•‘EFFICIENCY’

• HYDROGEN

• ELECTRICITY

• BIOFUELS

• NATURAL GAS

• OIL PRODUCTS

figure 6.6: heating and cooling supply in canada, to2050, under three scenarios

PJ/a 0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

2007 2015 2020 2030 2040 2050

REF E[R] adv E[R]

REF E[R] adv E[R]

REF E[R] advE[R]

REF E[R] advE[R]

REF E[R] advE[R]

RE F E[R] advE[R]

•‘EFFICIENCY’

• HYDROGEN

• GEOTHERMAL

• SOLAR

• BIOMASS

• FOSSIL FUELS

72

6

key resu

lts|

CO

2EM

ISSIO

NS &

PRIM

ARY E

NERGY C

ONSUM

PTIO

N


6.7 canada’s CO2 emissions

While Canada’s energy-related emissions of CO2 will increase by 10%between 2007 and 2050 under the Reference scenario, under theEnergy [R]evolution scenario they will decrease from 547 milliontonnes in 2007 to 71 million tonnes in 2050, and to 29 million tonnesunder the Advanced scenario. Annual per capita emissions will dropfrom 16.6 tonnes to 1.6 tonnes in 2050 in the basic scenario, and to0.7 tonnes in the Advanced scenario. Despite the phase-out of nuclearenergy and an increase in energy demand, CO2 emissions will decreasein the electricity sector. In the long run, efficiency gains and theincreased use of renewable electricity will even reduce the demand foroil and resulting CO2 emissions from the transportation sector.

The transportation sector, accounting for 30% of total CO2 in thebasic Energy [R]Evolution scenario, will be the largest source ofemissions in 2050. By 2050, in the Advanced scenario, Canada’senergy-related CO2 emissions are 94% below 1990 levels.

6.8 canada’s primary energy consumption

Primary energy consumption under the Energy [R]evolution scenario isshown in Figure 6.9. Compared to the Reference scenario, overall primaryenergy demand will be reduced by 50% in 2050 in the basic E[R]scenario even as population increases by 35%. About 61% of theremaining demand will be covered by renewable energy sources.

The Advanced Energy [R]evolution scenario phases out coal and oil about10 to 15 years faster than the Energy [R]evolution scenario. This is madepossible mainly by the replacement of new coal power plants withrenewables after a 20-year lifetime rather than 40, and a fasterintroduction of electric vehicles in the transportation sector to replace oil

combustion engines. This leads to an overall renewable energy share of37% in 2030 and 74% in 2050. Nuclear power is phased out in bothEnergy [R]evolution scenarios soon after 2040.

figure 6.8: development of CO2 emissions in canada to2050, by sector, under the energy [r]evolution scenarios

figure 6.9: development of primary energy consumption in canada to 2050, under three scenarios

PJ/a 0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

REF E[R]

2007

adv E[R]

REF E[R]

2015

adv E[R]

REF E[R]

2020

adv E[R]

REF E[R]

2030

adv E[R]

REF E[R]

2040

adv E[R]

REF E[R]

2050

adv E[R]

0

10

20

30

40

50

0

100

200

300

400

500

600

700

E[R]

2007

adv E[R]

E[R]

2015

adv E[R]

E[R]

2020

adv E[R]

E[R]

2030

adv E[R]

E[R]

2040

adv E[R]

E[R]

2050

adv E[R]

Mil t/aMillion people

•‘EFFICIENCY’

• OCEAN ENERGY

• GEOTHERMAL

• SOLAR

• BIOMASS

•WIND

• HYDRO

• NATURAL GAS

• OIL

• COAL

• NUCLEAR

POPULATION DEVELOPMENT

• SAVINGS FROM ‘EFFICIENCY’ & RENEWABLES

• OTHER SECTORS

• INDUSTRY

•TRANSPORT

• PUBLIC ELECTRICITY & CHP

73

key resu

lts|

FUTURE IN

VESTM

ENT

© ALEX NIEDRA/DREAMSTIME

© PGIAM/ISTOCK

image WIND TURBINES, ALBERTA,CANADA.

image WATER DAM IN MUSKOKA, CANADA.

plants. In regions with a good wind regime, for example, wind farmsare already competitive with coal or gas power plants.

It would require an investment of $343 billion for the Energy[R]evolution scenario to become reality—about 7.5% higher than forthe Reference scenario ($317 billion). The Advanced Energy[R]evolution scenario would need $399 billion—about 25% morethan for the Energy [R]evolution scenario.

Almost 30% of investment under the Reference scenario will go into fossilfuels and nuclear power plants, about $88 billion. Under the Energy[R]evolution scenarios, however, Canada shifts more than 80% ofinvestment into renewables and cogeneration, while the Advanced scenariomakes the shift about five to ten years earlier. By then, the fossil fuel shareof power sector investment would be focused mainly on combined heat andpower and efficient gas-fired power plants.

6.9 future investment

6.9.1 investment in new power plants

The overall investment in new power plants up to 2050 will be between$317- and 399 billion. Investment in new generating capacity will be drivenby the ageing of the existing fleet of power plants. Utilities must maketechnology choices within the next five to ten years, and these choices willbe based on provincial and federal energy policies, including renewableenergy and CO2 reduction targets.

Carbon-pricing schemes (either a carbon tax or a cap-and-tradesystem) could have a major impact on whether investment goes intofossil-fuelled power plants or into renewable energy and cogeneration.Carbon pricing will also play a major role in determining whetherrenewable energy becomes competitive with conventional power

figure 6.10: investment shares - reference versus energy [r]evolution scenarios

figure 6.11: change in cumulative power plantinvestment in both energy [r]evolution scenarios

reference scenario 2007 - 2050

14% NUCLEAR POWER

14% FOSSIL

1% CHP

71% RENEWABLES

total 317 billion $

energy [r]evolution scenario 2007 - 2050

14% FOSSIL

10% CHP

76% RENEWABLES

total 343 billion $

advanced energy [r]evolution scenario 2007 - 2050

11% FOSSIL

10% CHP

79% RENEWABLES

total 399 billion $

$bill

ion/

anum

2007-2020 2021-2030 2007-2050

140

120

100

80

60

40

20

0

-20

-40

-60

•FOSSIL & NUCLEAR E[R]

•FOSSIL & NUCLEAR ADVANCED E[R]•RENEWABLE E[R]

•RENEWABLE ADVANCED E[R]

74


6.9.2 fossil fuel power generation investment

Under the Reference scenario, investment in renewable electricitygeneration will be $227 billion. This compares to $351 billion under theAdvanced Energy [R]evolution scenario. How investment is divided betweenthe different renewable power generation technologies depends on theirlevel of technical development and regionally available resources.Technologies such as wind power, which in many regions is already cost-competitive with existing power plants, will take a larger investment volumeand a bigger market share.

The market volume attributed to different technologies also depends onlocal resources and policy frameworks within Canadian provinces. Figure6.12 provides an overview of the investment required for each technology.For solar photovoltaic, the primary market will remain in the southernareas close to the American border. Because solar photovoltaic energy is ahighly modular and decentralized technology that can be used almostanywhere, its market will eventually spread across Canada.

Small run-of-the-river hydro power plants, the modernization of existinghydro power plants, or installing turbines in existing dams will require arelatively large part of the renewable energy investment. Hydro powerplants are important because of their crucial ability to balance fluctuatingwind power. Development of the wind industry will take place mainly incoastal areas, but also in areas farther inland in Ontario, Quebec andAlberta. Bioenergy power plants will be distributed across Canada’sfarmland as there is potential almost everywhere for biomass and/or biogas(cogeneration) power plants.

figure 6.12: renewable energy investment costs in canada, 2007-2050

biomass

0 Billion $

hydro

wind

pv power plant

geothermal

ocean energy

20 40 60 80 100 120 140 160 180 200

future in

vestment and em

ploym

ent|

FUTURE IN

VESTM

ENT

6

© PGIAM/ISTOCK

image WIND TURBINE ON FARMLAND, CANADA.

75

6.9.3 fuel cost savings with renewable energy

The total fuel cost savings in the Energy [R]evolution scenario are$49 billion, or $1.1 billion per year (see Table 6.3). The AdvancedEnergy [R]evolution scenario has even higher fuel cost savings of$228 billion, or $5.3 billion per year. This is because many forms ofrenewable energy have no fuel costs. So in both cases the additionalinvestment for renewable power plants is financed entirely throughfuel cost savings, which add up to $27 billion in the Energy

[R]evolution scenario and $82 billion in the Advanced scenario, for2007–2050. This is more than enough to cover the entire investmentin renewable and cogeneration capacity required for either of theEnergy [R]evolution scenarios. The Advanced scenario would generatethe highest rate-of-return on investment, especially between 2030 and2050, and the fuel cost savings would be 2.7 times higher than theadditional investment.

table 6.3: investment costs and fuel savings in the three scenarios

INVESTMENT COST

WORLD (2010) DIFFERENCE E[R] VERSUS REF

Conventional (fossil & nuclear)Renewables (incl. CHP)TotalWORLD (2010) DIFFERENCE ADV E[R] VERSUS REF

Conventional (fossil & nuclear)Renewables (incl. CHP)Total

CUMULATED FUEL COST SAVINGS

SAVINGS E[R] CUMULATED IN $

Fuel oilGasHard coalLigniteTotalSAVINGS ADV E[R] CUMULATED IN $

Fuel oilGasHard coalLigniteTotal

DOLLAR

billion Can $billion Can $billion Can $

billion Can $billion Can $billion Can $

billion Can $/abillion Can $/abillion Can $/abillion Can $/abillion Can $/a

billion Can $/abillion Can $/abillion Can $/abillion Can $/abillion Can $/a

2007-2020

-22119

-115646

6-4732

-36

6-3962

-24

2007-2010

00

-6410

0800

2021-2030

-2011-9

-203414

10-102223

-67

10-59243

-21

2007-2050

-356127

-4212482

23-1221451249

234814414228

2007-2050 AVERAGE PER YEAR

-0.81.40.6

-1.02.91.9

0.5-2.83.40.31.1

0.51.13.30.35.3

future in

vestment and em

ploym

ent|

FUTURE IN

VESTM

ENT

6

76


“quote.”WHOWHERE/WHAT

RENEWABLE ENERGYCOALNUCLEAR

OILGAS

GLOBAL

energy resources & security of supply

87“the issue of securityof supply is now at the top of the energypolicy agenda.”GREENPEACE INTERNATIONALCLIMATE CAMPAIGN

AROUND80%OFGLOBAL

ENERGY DEMAND IS MET BYFIN

ITEFO

SSILFUELS. ©

R. KASPRZAK/DREAMSTIM

E

77

107 GLOBAL WIND ENERGY COUNCIL/RENEWABLE ENERGY SYSTEMS, PLUGGING THEGAP—A SURVEY OF WORLD FUEL RESOURCES AND THEIR IMPACT ON THEDEVELOPMENT OF WIND ENERGY, 2006. 108 THE INDEPENDENT, 10 DECEMBER 2007

Whilst private companies are now becoming more realistic about theextent of their resources, the OPEC countries hold by far the majorityof the reported reserves, and their information is as unsatisfactory asever. Their conclusions should therefore be treated with considerablecaution. To fairly estimate the world’s oil resources, a regionalassessment of the mean backdated (i.e., “technical”) discoverieswould need to be performed.

7.1.2 non-conventional oil reserves

A large share of the world’s remaining oil resources is classified as“non-conventional.” Potential fuels from sources such as oil sands,extra-heavy oil, and oil shale are generally more costly to exploit andtheir recovery involves enormous environmental damage. The reservesof oil sands and extra-heavy oil in existence worldwide are estimatedto amount to around six trillion barrels, of which between one andtwo trillion barrels are believed to be recoverable if the oil price ishigh enough and the environmental standards low enough.

One of the worst examples of environmental degradation resulting fromthe exploitation of unconventional oil reserves is the oil sands that liebeneath the Canadian province of Alberta and form the world's second-largest proven oil reserves, after Saudi Arabia. Producing crude oil fromthese “tar sands”—a heavy mixture of bitumen, water, sand and clayfound in northern Alberta beneath more than 54,000 square miles108 ofprime forest, an area the size of England and Wales combined—generatesup to four times more carbon dioxide (CO2), the principal gas causingglobal warming, than conventional drilling. Emissions from tar sandsoperations are the fastest growing source of greenhouse gases in Canada.The oil rush is also scarring a wilderness landscape: millions of tonnes ofplant life and top soil are scooped away in vast opencast mines, andmillions of litres of water diverted from rivers. Up to five barrels of waterare needed to produce a single barrel of crude oil and the processrequires huge amounts of natural gas. It takes two tonnes of the raw“sands” to produce a single barrel of oil.

7.2 gas

Natural gas has been the fastest growing fossil energy source over thelast two decades, boosted by its increasing share in the electricitygeneration mix. Gas is generally regarded as an abundant resource, andpublic concerns about fuel depletion are limited to oil, even though fewin-depth studies address the subject. Gas resources are moreconcentrated, and a few massive fields make up most of the reserves.The largest gas field in the world holds 15% of the ultimaterecoverable resources (URR), compared to 6% for oil. Unfortunately,information about gas resources suffers from the same bad practices asoil data because gas mostly comes from the same geologicalformations, and the same stakeholders are involved.

Most reserves are initially understated and then gradually revisedupwards, giving an optimistic impression of growth. By contrast,Russia’s reserves, the largest in the world, are considered to have

The issue of security of supply is now at the top of the energy policyagenda. Concern is focused both on price security and the security ofphysical supply. At present, around 80% of global energy demand ismet by fossil fuels. The unrelenting increase in energy demand ismatched by the finite nature of these resources. At the same time, theglobal distribution of oil and gas resources does not match thedistribution of demand. Some countries have to rely almost entirely onfossil fuel imports. The maps on the following pages provide anoverview of the availability of different fuels and their regionaldistribution. Information in this chapter is based partly on the reportPlugging the Gap,107 as well as information from the InternationalEnergy Agency’s World Energy Outlook 2008 and 2009 reports.

7.1 oil

Oil is the lifeblood of the modern global economy, as the effects of thesupply disruptions of the 1970s made clear. It is the number-onesource of energy, providing 32% of the world’s needs, and is the fuelemployed almost exclusively for essential uses such as transportation.However, a passionate debate has developed over the ability of supplyto meet increasing consumption, a debate obscured by poorinformation and stirred by recent soaring prices.

7.1.1 the reserves chaos

Public data about oil and gas reserves are strikingly inconsistent, andpotentially unreliable—for legal, commercial, historical and sometimespolitical reasons. The most widely available and quoted figures, those fromthe industry journals Oil & Gas Journal and World Oil, have limited valueas they report the reserve figures provided by companies and governmentswithout analysis or verification. Moreover, as there is no agreed-upondefinition of reserves or standard reporting practice, these figures usuallystand for different physical and conceptual magnitudes. Confusingterminology (“proved,” “probable,” “possible,” “recoverable,”“reasonable certainty”) only adds to the problem. Historically, private oilcompanies have consistently underestimated their reserves in order tocomply with conservative stock exchange rules, and through naturalcommercial caution. Whenever a discovery was made, only a portion ofthe geologist’s estimate of recoverable resources was reported;subsequent revisions would then increase the reserves from that same oilfield over time. National oil companies, mostly represented by theOrganization of Petroleum Exporting Countries (OPEC), have taken avery different approach. The OPEC companies are not subject to any sortof accountability and their reporting practices are even less clear. In thelate 1980s, the OPEC countries blatantly overstated their reserves whilecompeting for production quotas, which were allocated as a proportion ofthe reserves. Although some revision was needed after the companieswere nationalized, between 1985 and 1990, OPEC countries increasedtheir apparent joint reserves by 82%. Not only were these dubiousrevisions never corrected, but many of these countries have reporteduntouched reserves for years, even if no sizeable discoveries were madeand production continued at the same pace. Additionally, the FormerSoviet Union’s oil and gas reserves have been overestimated by about30% because the original assessments were later misinterpreted.

energ

y sources a

nd secu

rity of su

pply

|OIL

& G

AS

7

© THE UNITED STATES

COAST GUARD

image FIRE BOAT RESPONSE CREWS BATTLE THEBLAZING REMNANTS OF THE OFFSHORE OIL RIGDEEPWATER HORIZON APRIL 21, 2010. MULTIPLE COASTGUARD HELICOPTERS, PLANES AND CUTTERSRESPONDED TO RESCUE THE DEEPWATER HORIZON’S126 PERSON CREW.

109 INTERSTATE NATURAL GAS ASSOCIATION OF AMERICA (INGAA), “AVAILABILITY,ECONOMICS AND PRODUCTION POTENTIAL OF NORTH AMERICAN UNCONVENTIONALNATURAL GAS SUPPLIES”, NOVEMBER 2008

table 7.1: overview of known worldwide fossil fuel reserves and resources

note EJ = EXAJOULES; C = CONVENTIONAL RESERVES (PETROLEUM OF A CERTAIN DENSITY, FREENATURAL GAS, PETROLEUM GAS); NC = NON-CONVENTIONAL RESERVES (HEAVY FUEL OIL, VERYHEAVY OILS, TAR SANDS AND OIL SHALE, GAS IN COAL SEAMS, AQUIFER GAS, NATURAL GAS IN TIGHTFORMATIONS, GAS HYDRATES) TCM = TRILLION CUBIC METRES.source GERMAN ADVISORY COUNCIL ON GLOBAL CHANGE (WBGU), WORLD INTRANSITION: TOWARDS SUSTAINABLE ENERGY SYSTEMS, EARTHSCAN. 2004, UPDATEDWITH IEA WEO 2008 AND WEO 2009 DATA.

5,400

8,000

11,700

10,800

796,000

5,900

6,600

7,500

15,500

61,000

42,000

100,000

121,000

212,200

1,204,200

5,900

8,000

11,700

10,800

799,700

6,300

8,100

6,100

13,900

79,500

25,400

117,000

125,600

213,200

1,218,000

5,500

9,400

11,100

23,800

930,000

6,000

5,100

6,100

15,200

45,000

20,700

179,000

281,900

1,256,000

5,300

100

7,800

111,900

6,700

5,900

3,300

25,200

16,300

179,000

361,500

ENERGY CARRIER

Gas reserves

resources

additional occurrences

Oil reserves

resources


Coal reserves

resources


Total resource (reserves + resources)

Total occurrence

BROWN, 2002EJ

5,600

9,400

5,800

10,200

23,600

26,000

180,600

WEO 2009, WEO2008, WEO 2007

EJ

182 tcm

405 tcm

921 tcm

2,369 bb

847 bill tonnes

921 tcm

IEA, 2002cEJ

6,200

11,100

5,700

13,400

22,500

165,000

223,900

IPCC, 2001aEJ

c

nc

c

nc

c

nc

c

nc

NAKICENOVICET AL., 2000

EJ

c

nc

c

nc

c

nc

c

nc

UNDP ET AL.,2000

EJ

c

nc

c

nc

c

nc

c

nc

BGR, 1998EJ

c

nc

c

ncd

c

nc

c

nc

78


7.3 coal

Coal was the world’s largest source of primary energy until it wasovertaken by oil in the 1960s. Today, coal supplies almost one quarterof 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 andglobal warming.

Coal is abundant and more equally distributed throughout the world thanoil and gas. Global recoverable reserves are the largest of all fossil fuels,and most countries have at least some. Moreover, existing and prospectivebig energy consumers like the US, China and India are self-sufficient in coaland will be for the foreseeable future. Coal has been exploited on a largescale for two centuries, so both the product and the available resources arewell 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 trendsare maintained, coal reserves would still last several hundred years.

7.4 nuclear

Uranium, the fuel used in nuclear power plants, is a finite resource whoseeconomically available reserves are limited. Its distribution is almost asconcentrated as oil’s and does not match global consumption. Fivecountries—Canada, Australia, Kazakhstan, Russia and Niger—controlthree quarters of the world’s supply. As a significant user of uranium,however, Russia's reserves will be exhausted within ten years.

been overestimated by about 30%. Owing to geological similarities,gas follows the same depletion dynamic as oil, and thus the samediscovery and production cycles. In fact, existing data for gas are ofworse quality than those for oil, with ambiguities arising over theamount produced partly because flared and vented gas is not alwaysaccounted for. As opposed to published reserves, the technical oneshave been almost constant since 1980 because discoveries haveroughly matched production.

7.2.1 shale gas

Natural gas production, especially in the United States, has recentlyinvolved a growing contribution from non-conventional gas supplies suchas shale gas. Conventional natural gas deposits have a well-definedgeographical area, the reservoirs are porous and permeable, the gas isproduced easily through a wellbore and does not generally require artificialstimulation. Non-conventional deposits, on the other hand, are often lowerin resource concentration, more dispersed over large areas and requirewell stimulation or some other extraction or conversion technology. Theyare also usually more expensive to develop per unit of energy.109

Research and investment in non-conventional gas resources has increasedsignificantly in recent years due to the rising price of conventional naturalgas. In some areas the technologies for economic production have alreadybeen developed, in others they are still at the research stage. Extractingshale gas, however, usually goes hand in hand with environmentallyhazardous processes. Even so, production is expected to increase.

energ

y sources a

nd secu

rity of su

pply

|COAL &

NUCLEAR

7

energ

y sources a

nd secu

rity of su

pply

|RENEW

ABLE E

NERGY

7

79

© GP/LANGER

© N. BEHRING-CHISHOLM/GPimage PLATFORM/OIL RIG DUNLIN IN THE NORTH SEA SHOWING OIL POLLUTION.

image ON A LINFEN STREET, TWO MEN LOAD UP A CART WITH COAL THAT WILL BEUSED FOR COOKING. LINFEN, A CITY OF ABOUT 4.3 MILLION, IS ONE OF THE MOSTPOLLUTED CITIES IN THE WORLD. CHINA’S INCREASINGLY POLLUTED ENVIRONMENTIS LARGELY A RESULT OF THE COUNTRY’S RAPID DEVELOPMENT AND CONSEQUENTLYA LARGE INCREASE IN PRIMARY ENERGY CONSUMPTION, WHICH IS ALMOST ENTIRELYPRODUCED BY BURNING COAL.

Secondary sources, such as old deposits, currently make up nearlyhalf of worldwide uranium reserves. These will soon be used up,however. Mining capacities will have to be nearly doubled in the nextfew years to meet current needs.

A joint report by the OECD Nuclear Energy Agency and the InternationalAtomic Energy Agency110 estimates that all existing nuclear power plantswill have used up their nuclear fuel, employing current technology, withinless than 70 years. Given the range of scenarios for the worldwidedevelopment of nuclear power, it is likely that uranium supplies will beexhausted sometime between 2026 and 2070. This forecast includes theuse of mixed oxide fuel (MOX), a mixture of uranium and plutonium.

7.5 renewable energy

Nature offers a variety of freely available options for producingenergy. Their exploitation is mainly a question of how to convertsunlight, wind, biomass or water into electricity, heat or power asefficiently, sustainably and cost-effectively as possible.

On average, the energy in the sunshine that reaches the earth is about onekilowatt per square metre, worldwide. According to the Research Associationfor Solar Power, power is gushing from renewable energy sources at a rate of2,850 times more energy than is needed in the world. In one day, the sunlightwhich reaches the earth produces enough energy to satisfy the world’scurrent power requirements for eight years. Even though only a percentageof that potential is technically accessible, this is still enough to provide justunder six times more power than the world currently requires.

Before looking at the part renewable energies can play in the range ofscenarios in this report, however, it is worth understanding the upperlimits of their potential. To start with, the overall technical potential ofrenewable energy—the amount that can be produced, taking into accountthe primary resources, the socio-geographical constraints and thetechnical losses in the conversion process—is huge and several timeshigher than current total energy demand. Assessments of the globaltechnical potential vary significantly from 2,477 exajoules per annum(EJ/a)111 up to 15,857 EJ/a.112 Based on the global primary energydemand in 2007113 of 503 EJ/a, the total technical potential of renewableenergy sources at the upper limit would exceed demand by a factor of 32.However, barriers to the growth of renewable energy technologies maycome from economical, political and infrastructural constraints. That iswhy the technical potential will never be realised in total.

Assessing long-term technical potentials is subject to various uncertainties.The distribution of the theoretical resources, such as the global wind speedor the productivity of energy crops, is not always well analyzed. Thegeographical availability is subject to variations such as land-use change,future planning decisions on where certain technologies are allowed, andaccessibility of resources, for example underground geothermal energy.Technical performance may take longer to achieve than expected. Thereare also uncertainties in terms of the consistency of the data provided instudies, and underlying assumptions are often not explained in detail.

table 7.2: assumptions on fossil fuel use in the reference and energy [r]evolution scenarios

2015

161,847

26,446

153,267

25,044

152,857

24,977

2007

155,920

25,477

2020

170,164

27,805

143,599

23,464

142,747

23,325

2030

192,431

31,443

123,756

20,222

115,002

18,791

2040

209,056

34,159

101,186

16,534

81,608

13,335

2050

224,983

36,762

81,833

13,371

51,770

8,459

Oil

Reference [PJ]

Reference [million barrels]

E[R] [PJ]

E[R] [million barrels]

Adv E[R] [PJ]

Adv E[R] [million barrels]

112,931

2,972

116,974

3,078

118,449

3,117

104,845

2,759

121,148

3,188

121,646

3,201

119,675

3,149

141,706

3,729

122,337

3,219

114,122

3,003

155,015

4,079

99,450

2,617

79,547

2,093

166,487

4,381

71,383

1,878

34,285

902

Gas

Reference [PJ]

Reference [billion cubic metres = 10E9m3]

E[R] [PJ]

E[R] [billion cubic metres = 10E9m3]

Adv E[R] [PJ]

Adv E[R] [billion cubic metres = 10E9m3]

162,859

8,306

140,862

7,217

135,005

6,829

135,890

7,319

162,859

8,306

140,862

7,217

135,005

6,829

204,231

9,882

96,846

4,407

69,871

3,126

217,356

10,408

64,285

2,810

28,652

1,250

225,245

10,751

37,563

1,631

7,501

326

Coal

Reference [PJ]

Reference [million tonnes]

E[R] [PJ]

E[R] [million tonnes]

Adv E[R] [PJ]

Adv E[R] [million tonnes]

110 OECD NUCLEAR ENERGY AGENCY, AND IAEA, URANIUM 2003: RESOURCES,PRODUCTION AND DEMAND, 2003.111 NITSCH 2004.112 UBA 2009.113 IEA, WORLD ENERGY OUTLOOK 2009, 2009.

note PJ/A = PETAJOULES PER ANNUM.

80


7

energ

y resources &

security o

f supply

|OIL

NON RENEWABLE RESOURCE

LEGEND

REFERENCE SCENARIO


REF

E[R]

0 1000 KM

RESERVES TOTAL THOUSAND MILLION BARRELS [TMB] | SHARE IN % OF GLOBAL TOTAL [END OF 2007]

CONSUMPTION PER REGION MILLION BARRELS [MB] | PETA JOULE [PJ]

CONSUMPTION PER PERSON LITERS [L]


OIL

TMB %

OECD NORTH AMERICA

2007 69.3 5.6%

2007

2050

7,429H

6,594H

45,466H

40,352H

TMB %

69.3 5.6%

45,466H

7,494

7,429H

1,225

PJ PJMB MB

2007

2050

2,707H

1,816H

2,707H

337

L L

REF E[R]

TMB %

LATIN AMERICA

2007 111.2 9.0%

2007

2050

1,691

2,597

10,349

15,895

TMB %

111.2 9.0%

10,349

1,788

1,691

292

PJ PJMB MB

2007

2050

598

653

598

73

L L

REF E[R]

>60 50-60 40-50

30-40 20-30 10-20

5-10 0-5 % RESOURCESGLOBALLY

1988

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2010

2020

2030

2040

2050

140

130

120

110

100

90

80

70

60

50

40

30

20

10

0

$ PER B

ARREL

YEARS 1988 - 2007 PAST YEARS 2007 - 2050 FUTURE

COST

crude oil prices 1988 -2007 and future predictionscomparing the REF andadvanced E[R] scenarios 1 barrel = 159 litresSOURCES REF: INTERNATIONALENERGY AGENCY/E[R]: DEVELOPMENTSAPPLIED IN THE GES-PROJECT

E[R]REF

map 7.1: oil reference scenario and the advanced energy [r]evolution scenarioWORLDWIDE SCENARIO

81

7

energ

y resources &

security o

f supply

|OIL

TMB %

AFRICA

2007 117.5M 9.5%

2007

2050

924

1,667

5,654

10,202

TMB %

117.5M 9.5%

5,654

4,214

924

689

PJ PJMB MB

2007

2050

159

133L

159

55L

L L

REF E[R]

TMB %

INDIA

2007 5.5 0.5%

2007

2050

1,011L

3,669

6,187L

22,455

TMB %

5.5 0.5%

6,187

7,152

1,011

1,169

PJ PJMB MB

2007

2050

142L

352

142L

112

L L

REF E[R]

TMB %

DEVELOPING ASIA

2007 14.8 1.2%

2007

2050

1,656

3,448

10,136

21,099

TMB %

14.8 1.2%

10,136

6,204

1,656

1,014

PJ PJMB MB

2007

2050

270

365

270

107

L L

REF E[R]

TMB %

OECD PACIFIC

2007 5.1L 0.4%

2007

2050

2,465M

1,724

15,089M

10,552

TMB %

5.1L 0.4%

15,086

2,805

2,465

458

PJ PJMB MB

2007

2050

1,958

1,539

1,958

409H

L L

REF E[R]

TMB %

GLOBAL

2007 1,199 100%

2007

2050

25,477

36,762

155,919

224,981

TMB %

1,199 100%

155,919

51,770

25,477

8,459

PJ PJMB MB

2007

2050

623

637

623

147

L L

REF E[R]

TMB %


2007 87.6 10.1%L

2007

2050

1,605

1,953L

9,826

11,955L

TMB %

87.6 10.1%L

9,826

2,701L

1,605

441L

PJ PJMB MB

2007

2050

748M

1,057

748M

239

L L

REF E[R]

TMB %

CHINA

2007 15.5 1.3%

2007

2050

2,445

7,946

14,966

48,629

TMB %

15.5 1.3%

14,966

11,513H

2,445

1,881H

PJ PJMB MB

2007

2050

294

891

294

211M

L L

REF E[R]

TMB %

MIDDLE EAST

2007 755.3H 61.0%H

2007

2050

1,913

3,574

11,709

21,871

TMB %

755.3H 61.0%H

11,709

3,482

1,913

569

PJ PJMB MB

2007

2050

1,617

1,638

1,617

261

L L

REF E[R]20

07

2015

2020

2030

2040

2050

25

20

15

10

5

0

BIL

LIO

N T

ONNES

YEARS 2007 - 2050

CO2 EMISSIONSFROM OIL

comparison between the REF and advancedE[R] scenarios 2007 -2050 billion tonnes

SOURCE GPI/EREC

E[R]

REF

1988

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2010

2020

2030

2040

2050

1972

1973

1974

1975

1976

1977

1978

1979

1980

1981

1982

1983

1984

1985

1986

1987

1988

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

20

07

2010

2020

2030

2040

2050


RESERVES AND CONSUMPTION

oil reserves versus global demand, production and consumption. global consumption comparisonbetween the REF and advanced E[R] scenarios.

million barrels. 1 barrel = 159 litres

1,199BILLIONBARRELSPROVEN2007

SOURCE BP 2008

50,000

40,000

30,000

20,000

10,000

0

MIL

LIO

N B

ARRELS

E[R]

REF

1,358BILLIONBARRELSUSED SINCE2007

811BILLIONBARRELSUSED SINCE2007

TMB %

OECD EUROPE

2007 16.9 1.4%M

2007

2050

4,337

3,590M

26,541

21,970M

TMB %

16.9 1.4%M

4,418

9,361M

4,337

722M

PJ PJMB MB

2007

2050

1,285

1,013M

1,285

204

L L

REF E[R]

REF global consumption

ADV E[R] global consumption

DESIG

NWWW.ONEHEMISPHERE.SE C

ONCEPTSVEN TESKE/GREENPEACE INTERNATIONAL.

82


7

energ

y resources &

security o

f supply

|GAS

map 7.2: gas reference scenario and the advanced energy [r]evolution scenarioWORLDWIDE SCENARIO


LEGEND

REFERENCE SCENARIO


REF

E[R]

0 1000 KM

RESERVES TOTAL TRILLION CUBIC METRES [tn m3] | SHARE IN % OF GLOBAL TOTAL [END OF 2007]

CONSUMPTION PER REGION BILLION CUBIC METRES [bn m3] | PETA JOULE [PJ]

CONSUMPTION PER PERSON CUBIC METRES [m3]


GAS>50 40-50 30-40

20-30 10-20 5-10

0-5 % RESOURCESGLOBALLY

1988

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2010

2020

2030

2040

2050

2423222120191817161514131211109876543210

$ PER M

ILLIO

N B

tu


COST

gas prices of LNG/natural gas 1984 - 2007and future predictionscomparing the REF and adv. E[R] scenarios.SOURCE JAPAN CIF/EUROPEANUNION CIF/IEA 2007 - US IMPORTS/IEA 2007 - EUROPEAN IMPORTS

LNG

NATURAL GAS

tn m3 %

OECD NORTH AMERICA

2007 8.0 4.4%

2007

2050

722H

767H

27,435H

29,144H

tn m3 %

8.0 4.4%

27,435H

2,688H

722H

71H

PJ PJbn m3 bn m3

2007

2050

1,608

1,328

1,608

123

m3 m3

REF E[R]

tn m3 %

LATIN AMERICA

2007 7.7 4.3%

2007

2050

117

246M

4,465

9,358M

tn m3 %

7.7 4.3%

4,465

1,303

117

34

PJ PJbn m3 bn m3

2007

2050

254

410

254

57

m3 m3

REF E[R]

E[R]

REF

83

7

energ

y resources &

security o

f supply

|GAS

1988

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2010

2020

2030

2040

2050

2007

2015

2020

2030

2040

2050

25

20

15

10

5

0

BIL

LIO

N T

ONNES

YEARS 2007 - 2050

CO2 EMISSIONSFROM GAS

comparison between the REF and adv. E[R]scenarios 2007 - 2050

billion tonnesSOURCE GPI/EREC

E[R]

1972

1973

1974

1975

1976

1977

1978

1979

1980

1981

1982

1983

1984

1985

1986

1987

1988

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2015

2020

2030

2040

2050



gas reserves versus global demand, production and consumption. global consumption comparisonbetween the REF and advanced E[R] scenarios.

billion cubic metres



181TRILLIONCUBIC METRESPROVEN 2007

SOURCE 1970-2008 BP, 2007-2050 GPI/EREC

5,000

4,000

3,000

2,000

1,000

0

BIL

LIO

N m

3

E[R]

158TRILLIONCUBICMETRESUSED SINCE2007

112TRILLIONCUBICMETRESUSED SINCE2007

REF

tn m3 %

AFRICA

2007 14.6M 8.0%M

2007

2050

91

167

3,472

6,338

tn m3 %

14.6M 8.0%M

3,472

2,456

91

65

PJ PJbn m3 bn m3

2007

2050

95

83

95

32L

m3 m3

REF E[R]

tn m3 %

INDIA

2007 1.1L 0.6%L

2007

2050

37L

164L

1,397L

6,227L

tn m3 %

1.1L 0.6%L

1,397L

4,075M

37L

107M

PJ PJbn m3 bn m3

2007

2050

32L

102L

32L

66

m3 m3

REF E[R]

tn m3 %

DEVELOPING ASIA

2007 8.6 4.8%

2007

2050

184

422

6,998

16,020

tn m3 %

8.6 4.8%

6,998

4,368

184

115

PJ PJbn m3 bn m3

2007

2050

182

278

182

76

m3 m3

REF E[R]

tn m3 %

OECD PACIFIC

2007 2.9 1.6%

2007

2050

156

170

5,912

6,467

tn m3 %

2.9 1.6%

5,912

667L

156

18L

PJ PJbn m3 bn m3

2007

2050

776M

946

776M

98

m3 m3

REF E[R]

tn m3 %

GLOBAL

2007 181 100%

2007

2050

2,759

4,381

104,846

166,489

tn m3 %

181 100%

104,846

34,285

2,759

902

PJ PJbn m3 bn m3

2007

2050

424

478

424

99

m3 m3

REF E[R]

tn m3 %


2007 53.3 29.4%

2007

2050

638

776

24,225

29,478

tn m3 %

53.3 29.4%

24,225

5,248

638

138

PJ PJbn m3 bn m3

2007

2050

1,874H

2,496H

1,874H

444H

m3 m3

REF E[R]

tn m3 %

CHINA

2007 1.9 1.0%

2007

2050

71

341

2,716

12,953

tn m3 %

1.9 1.0%

2,716

8,061

71

212

PJ PJbn m3 bn m3

2007

2050

54

239

54

149

m3 m3

REF E[R]

tn m3 %

MIDDLE EAST

2007 73.2H 40.4%H

2007

2050

238M

685

9,056M

26,034

tn m3 %

73.2H 40.4%H

9,056

2,805

239

74

PJ PJbn m3 bn m3

2007

2050

1,178

1,939

1,178

209M

m3 m3

REF E[R]

tn m3 %

OECD EUROPE

2007 9.8 5.4%

2007

2050

504

644

19,170

24,469

tn m3 %

9.8 5.4%

19,170

2,613

504

69

PJ PJbn m3 bn m3

2007

2050

934

1,120M

934

120

m3 m3

REF E[R]

DESIG



REF

84


7

energ

y resources &

security o

f supply

|COAL

map 7.3: coal reference scenario and the advanced energy [r]evolution scenarioWORLDWIDE SCENARIO


LEGEND

REFERENCE SCENARIO


REF

E[R]

0 1000 KM

RESERVES TOTAL MILLION TONNES [mn t] | SHARE IN % OF GLOBAL TOTAL [END OF 2007]

CONSUMPTION PER REGION MILLION TONNES [mn t] | PETA JOULE [PJ]

CONSUMPTION PER PERSON TONNES [t]


COAL>60 50-60 40-50

30-40 20-30 10-20


1988

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2015

2020

2030

2040

2050

175

150

125

100

90

80

70

60

50

40

30

20

10

0

$ PER T

ONNE

YEARS 2007 - 2050 FUTURE

COST

coal prices 1988 - 2007and future predictions forthe adv. E[R] scenario.$ per tonne

SOURCE MCCLOSKEY COALINFORMATION SERVICE - EUROPE.PLATTS - US.

NW EUROPE

US CENTRAL APPALACHIAN

JAPAN STEAM COAL

E[R]

mn t %

OECD NORTH AMERICA

2007 250,510 29.6%

2007

2050

1,882

1,351

24,923

27,255

mn t %

250,510 29.6%

24,923

134

1,882

6

PJ PJmn t mn t

2007

2050

2.4

2.0

2.4

0.0

t t

REF E[R]

mn t %

LATIN AMERICA

2007 16,276 1.9%

2007

2050

45

165

891

3,122

mn t %

16,276 1.9%

891

247

45

11

PJ PJmn t mn t

2007

2050

0.1

0.2

0.1

0.0

t t

REF E[R]

YEARS 1988 - 2007 PAST

REF

85

7

energ

y resources &

security o

f supply

|COAL

1988

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2015

2020

2030

2040

2050

2007

2015

2020

2030

2040

2050

25

20

15

10

5

0

BIL

LIO

N T

ONNES

YEARS 2007 - 2050

CO2 EMISSIONSFROM COAL

comparison between the REF and adv. E[R]scenarios 2007 - 2050

billion tonnesSOURCE GPI/EREC

REF

E[R]

1972

1973

1974

1975

1976

1977

1978

1979

1980

1981

1982

1983

1984

1985

1986

1987

1988

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

20

0620

07

2015

2020

2030

2040

2050



coal reserves versus global demand, production and consumption. global consumption comparisonbetween the REF and adv. E[R] scenarios.

million tonnes



846BILLIONTONNESPROVEN2007

SOURCE 1970-2050 GPI/EREC, 1970-2008 BP.

13,000

12,000

11,000

10,000

9,000

8,000

7,000

6,000

5,000

4,000

3,000

2,000

1,000

0

MIL

LIO

N T

ONNES

E[R]

360BILLIONTONNESUSED SINCE2007

159BILLIONTONNESUSED SINCE2007

REF

mn t %

AFRICA

2007 49,605 5.9%

2007

2050

188

303

4,330

6,977

mn t %

49,605 5.9%

4,330

427

188

19

PJ PJmn t mn t

2007

2050

0.2

0.2

0.2

0.0

t t

REF E[R]

mn t %

INDIA

2007 56,498 6.7%M

2007

2050

459

1,692

10,126

36,709

mn t %

56,498 6.7%M

10,126

851

459

37

PJ PJmn t mn t

2007

2050

0.4

1.0

0.4

0.0

t t

REF E[R]

mn t %

DEVELOPING ASIA

2007 7,814 0.9%

2007

2050

330

868M

5,824

17,902

mn t %

7,814 0.9%

5,824

217

330

9

PJ PJmn t mn t

2007

2050

0.3

0.5

0.3

0.0

t t

REF E[R]

mn t %

OECD PACIFIC

2007 77,661 9%

2007

2050

565

518

10,652

10,097

mn t %

77,661 9%

10,652

27

565

1L

PJ PJmn t mn t

2007

2050

2.3

2.4

2.3

0.0

t t

REF E[R]

mn t %

GLOBAL

2007 846,496 100%

2007

2050

7,319

10,751

135,890

225,244

mn t %

846,496 100%

135,890

7,501

7,319

326

PJ PJmn t mn t

2007

2050

0.9

1.1

0.9

0.0

t t

REF E[R]

mn t %


2007 222,183 26%

2007

2050

532

904

9,003

13,665

mn t %

222,183 26%

9,003

327

532

14

PJ PJmn t mn t

2007

2050

1.1

1.9M

1.1

0.0

t t

REF E[R]

mn t %

CHINA

2007 114,500 13.5%

2007

2050

2,403H

4,148H

55,333H

95,527H

mn t %

114,500 13.5%

55,333

5,027H

2,403

218H

PJ PJmn t mn t

2007

2050

1.8

2.9H

1.8

0.2H

t t

REF E[R]

mn t %

MIDDLE EAST

2007 1,386 0.2%L

2007

2050

19L

91L

437L

2,092L

mn t %

1,386 0.2%L

437

13

19

1L

PJ PJmn t mn t

2007

2050

0.0L

0.2L

0.0

0.0

t t

REF E[R]

mn t %

OECD EUROPE

2007 50,063 5.9%

2007

2050

897

710

14,371

11,899

mn t %

50,063 5.9%

14,371

231

897

10

PJ PJmn t mn t

2007

2050

1.2

0.9

1.2

0.0

t t

REF E[R]

DESIG



86


7

energ

y resources &

security o

f supply

|NUCLEAR

map 7.4: nuclear reference scenario and the advanced energy [r]evolution scenarioWORLDWIDE SCENARIO


LEGEND

REFERENCE SCENARIO


REF

E[R]

0 1000 KM

RESERVES TOTAL TONNES | SHARE IN % OF GLOBAL TOTAL [END OF 2007]

GENERATION PER REGION TERAWATT HOURS [TWh]

CONSUMPTION PER REGION PETA JOULE [PJ]

CONSUMPTION PER PERSON KILOWATT HOURS [kWh]


NUCLEAR>30 20-30 10-20


1987

1988

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2010

2020

2030

2040

2050

110

100

90

80

70

60

50

40

30

20

10

0

$US/L

BS

t %

OECD NORTH AMERICA

2007 680,109 21.5%

2007

2050

941H

1,259H

t %

680,109 21.5%


TWh TWh

2007

2050

10,260H

13,735H

10,260H

0

PJ PJ

2007

2050

2,094H

2,181

2,094H

0

kWh kWh

REF E[R]

t %

LATIN AMERICA

2007 95,045 3%

2007

2050

20

60

t %

95,045 3%

PHASED OUT BY 2030

TWh TWh

2007

2050

214

655

214

0

PJ PJ

2007

2050

42

100

42

0

kWh kWh

REF E[R]

YEARS 1970 - 2008 PAST

87

7

energ

y resources &

security o

f supply

|NUCLEAR

1987

1988

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2010

2020

2030

2040

2050

35

30

25

20

15

10

5

0

NO. O

F R

EACTO

RS

AGE OF REACTORS IN YEARS

REACTORS

age and number of reactors worldwide

SOURCES IAEA

0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43

4,500

4,000

3,500

3,000

2,500

2,000

1,500

1,000

500

0

YEARS 2007 - 2050

PRODUCTION

nuclear generation versusinstalled capacity.comparison between theREF and adv. E[R] scenrios.TWh and GW

SOURCES GREENPEACE INTERNATIONAL

2007

2010

2020

2030

2040

2050

600

500

400

300

200

100

0

TW

h

GW

REF global generation (TWh)

REF global capacity (GW)

ADV E[R] global generation (TWh)

ADV E[R] global capacity (GW)

GW

TWh

GW

TWh

REFE[R]

t %

AFRICA

2007 470,312M 14.8%M

2007

2050

11

45

t %

470,312M 14.8%M


TWh TWh

2007

2050

123

491

123

0

PJ PJ

2007

2050

12

23L

12

0

kWh kWh

REF E[R]

t %

INDIA

2007 40,980 1.3%

2007

2050

17

172

t %

40,980 1.3%


TWh TWh

2007

2050

183

1,876

183

0

PJ PJ

2007

2050

17

172

17

0

kWh kWh

REF E[R]

t %

DEVELOPING ASIA

2007 5,630 0.2%

2007

2050

44

80

t %

5,630 0.2%


TWh TWh

2007

2050

476

873

476

0

PJ PJ

2007

2050

43

53

43

0

kWh kWh

REF E[R]

t %

0ECD PACIFIC

2007 741,600 23.4%

2007

2050

407

868

t %

741,600 23.4%


TWh TWh

2007

2050

4,437

9,469

4,437

0

PJ PJ

2007

2050

2,030

4,827H

2,030

0

kWh kWh

REF E[R]

t %

GLOBAL

2007 3,169,238 100%

2007

2050

2,719

4,413

t %

3,169,238 100%


TWh TWh

2007

2050

29,664

48,142

29,664

0

PJ PJ

2007

2050

418

481

418

0

kWh kWh

REF E[R]

t %


2007 1,043,687H 32.9%H

2007

2050

293M

463

t %

1,043,687H 32.9%H


TWh TWh

2007

2050

3,197M

5,051

3,197M

0

PJ PJ

2007

2050

861M

1,490

861M

0

kWh kWh

REF E[R]

t %

CHINA

2007 35,060 1.1%

2007

2050

62

817

t %

35,060 1.1%


TWh TWh

2007

2050

678

8,913

678

0

PJ PJ

2007

2050

47

573

47

0

kWh kWh

REF E[R]

t %

MIDDLE EAST

2007 370L 0%L

2007

2050

0L

14L

t %

370L 0%L

NO NUCLEARENERGYDEVELOPMENT

TWh TWh

2007

2050

0L

153L

0L

0

PJ PJ

2007

2050

0L

40

0L

0

kWh kWh

REF E[R]

t %

OECD EUROPE

2007 56,445 1.8%

2007

2050

925

635M

t %

56,445 1.8%

PHASED OUT BY 2030

TWh TWh

2007

2050

10,096

6,927M

10,096

0

PJ PJ

2007

2050

1,714

1,105M

1,714

0

kWh kWh

REF E[R]

COST

yellow cake prices 1987 -2008 and future predictionscomparing the REF andadv. E[R] scenariostonnesSOURCES REF: INTERNATIONAL ENERGY AGENCY/E[R]: DEVELOPMENTSAPPLIED IN THE GES-PROJECT


DESIG



The meta-study by the DLR (German aerospace agency), WuppertalInstitute and Ecofys, commissioned by the German Federal EnvironmentAgency, provides a comprehensive overview of the technical renewableenergy potential by technologies and world region.114 This survey analyzedten major studies of global and regional potentials by organizations suchas the United Nations Development Programme and a range of academicinstitutions. Each of the major renewable energy sources was assessed,with special attention paid to the effect of environmental constraints ontheir overall potential. The study provides data for the years 2020, 2030and 2050 (see Table 7.3).

The complexity of calculating renewable energy potentials is particularlygreat because these technologies are comparatively young and theirexploitation involves changes to the way in which energy is bothgenerated and distributed. Whilst a calculation of the theoretical andgeographical potentials has only a few dynamic parameters, thetechnical potential is dependent on a number of uncertainties.

A technology breakthrough, for example, could have a dramatic impact,changing the technical potential assessment within a very short timeframe. Considering the huge dynamic of technology development, manyexisting studies are based on out-of-date information. The estimates inthe DLR study could therefore be updated using more recent data; forexample, significantly increased average wind turbine capacity andoutput, which would increase the technical potentials still further.

Given the large unexploited resources which exist, even withouthaving reached the full development limits of the various technologies,it can be concluded that the technical potential is not a limitingfactor to expansion of renewable energy generation.

It will not be necessary to exploit the entire technical potential,however, nor would this be unproblematic. Implementation ofrenewable energies has to respect sustainability criteria in order toachieve a sound future energy supply. Public acceptance is crucial,especially bearing in mind that the decentralized character of manyrenewable energy technologies means their operations will movecloser to consumers. Without public acceptance, market expansionwill be difficult or even impossible. The use of biomass, for example,has become controversial in recent years as it is seen as competingwith other land uses, food production or nature conservation.Sustainability criteria will have a huge influence on whether bio-energy in particular can play a central role in future energy supply.

As important as the technical potential of worldwide renewable energysources is their market potential. The term “potential” is often used indifferent ways. The general understanding is that market potentialmeans the total amount of renewable energy that can be implementedin the market taking into account the demand for energy, competingtechnologies, any subsidies available as well as the current and futurecosts of renewable energy sources. The market potential may thereforein theory be larger than the economic potential. To be realistic, however,market potential analyses have to take into account the behaviour ofprivate economic agents under specific prevailing conditions, which areof course partly shaped by public authorities. The energy policyframework in a particular country or region will have a profoundimpact on the expansion of renewable energies.

definition of types of energy resource potential115

theoretical potential The theoretical potential identifies the physicalupper limit of the energy available from a certain source. For solarenergy, for example, this would be the total solar radiation falling ona particular surface.

conversion potential This is derived from the annual efficiency of therespective conversion technology. It is therefore not a strictly definedvalue, since the efficiency of a particular technology depends ontechnological progress.

technical potential This takes into account additional restrictionsregarding the area that is realistically available for energy generation.Technological, structural and ecological restrictions, as well aslegislative requirements, are accounted for.

economic potential The proportion of the technical potential thatcan be utilised economically. For biomass, for example, thosequantities are included that can be exploited economically incompetition with other products and land uses.

sustainable potential This limits the potential of an energy sourcebased on evaluation of ecological and socio-economic factors.

88


figure 7.1: energy resources of the world

114 DLR, WUPPERTAL INSTITUTE, ECOFYS, ROLE AND POTENTIAL OF RENEWABLEENERGY AND ENERGY EFFICIENCY FOR GLOBAL ENERGY SUPPLY, COMMISSIONED BYGERMAN FEDERAL ENVIRONMENT AGENCY, FKZ 3707 41 108, MARCH 2009.115 WBGU (GERMAN ADVISORY COUNCIL ON GLOBAL CHANGE).

energ

y sources a

nd secu

rity of su

pply

|RENEW

ABLE E

NERGY

7

ENERGYRESOURCES OF THE WORLD

POTENTIAL OF RENEWABLEENERGY SOURCES ALL RENEWABLEENERGY SOURCES PROVIDE 3078TIMES THE CURRENT GLOBALENERGY NEEDS

SOLAR ENERGY2850 TIMES

BIOMASS20 TIMES

GEOTHERMAL ENERGY 5 TIMES

WAVE-TIDALENERGY 2 TIMES

HYDROPOWER1 TIMES

WIND ENERGY200 TIMES

source WBGU

89

energ

y sources a

nd secu

rity of su

pply

|RENEW

ABLE E

NERGY

7



image SOLON AG PHOTOVOLTAICS FACILITY IN ARNSTEIN OPERATING 1,500HORIZONTAL AND VERTICAL SOLAR “MOVERS”. LARGEST TRACKING SOLAR FACILITY IN THE WORLD. EACH “MOVER” CAN BE BOUGHT AS A PRIVATE INVESTMENT FROM THE S.A.G. SOLARSTROM AG, BAYERN, GERMANY.

image WIND ENERGY PARK NEAR DAHME. WIND TURBINE IN THE SNOW OPERATED BY VESTAS.

7.5.1 the global potential for sustainable biomass

Bioenergy’s role in the energy revolution must be limited to biomass thatis sustainably produced and which results in significant reductions ingreenhouse gas emissions.

Various studies have looked historically at the potential for bioenergy andcome up with widely differing results. As part of background research forthe Energy [R]evolution scenario, Greenpeace commissioned the GermanBiomass Research Centre (the former Institute for Energy andEnvironment) to investigate the worldwide potential for energy crops, up to2050. In addition, information has been compiled from scientific studies ofthe global potential and from data derived from state-of-the-art remotesensing techniques, such as satellite images. A summary of these findingscan be found in the 2010 global Energy [R]evolution report.116

The Energy [R]evolution scenarios adopt a conservative approach, andassume roughly 88 EJ of global primary energy coming from biomass in2050. The bulk of this (75 EJ per year) is crop harvest residues (e.g., straw,stalk and leaves) and crop process residues (e.g., oilcakes, hulls and shells),while assuming that most (75%) of the crop harvest residues and total cropbiomass will remain in the field for carbon and nutrient recycling purposes.About 8–9 EJ per year will come from wood-processing residues (e.g., fromsawmills) and discarded wood products. This equals 0.7–0.8 billion cubicmetres (m3) of wood residues per year, or less than half of today´s annualconsumption of fuelwood. The remaining 4–5 EJ per year will come fromdedicated bioenergy crops, which would require less than 1% of today´sglobal cropland and probably less than today’s already existing bioenergycroplands. Pressure to expand croplands can also be eased through a shiftto a less meat-intensive diet, particularly in the developed world.

All biomass must meet the following sustainability criteria:

1.Any bioenergy project should have a positive GHG balance of at least60%. The calculation of the GHG balance must be made over the wholeproduction chain. This automatically favours the most efficient biomassapplication, such as electricity and heat production as opposed totransport. The GHG balance must also include the greenhouse gasemissions from indirect conversion of natural ecosystems.

2.Crops and plantations for bioenergy must not cause direct orindirect destruction or conversion of natural forests or othernatural or valuable ecosystems. Natural forests are not onlyimportant carbon stores, but have high biodiversity value as well.

3.Biomass from natural ecosystems should be sourced in anenvironmentally responsible and socially just manner, such as throughcertification by the Forest Stewardship Council (FSC). Additionalcriteria for the use of wood and wood residues from forests must beapplied. Grass from grasslands must also be harvested sustainably.

4.Social conflicts should be avoided and food security, livelihoods and landrights should not be undermined. Production and use of bioenergy shouldnot widen social inequalities, especially between developing and developedcountries. Local needs should take priority over global trade andproduction. In addition, international trade in biomass or biofuels must notresult in negative social impacts, nor undermine food security. Land useconflicts should be avoided and indigenous peoples and local communitieshave the right to free and prior informed consent for the use of their land.

5.Bioenergy projects must involve no deliberate release of geneticallyengineered (GE) organisms to the environment. Any bioenergy crops,including trees, must not be genetically engineered.

6.Bioenergy crops and plantations should reflect the promotion ofbiodiversity, which means that the projects must not concentrate onmonoculture plant and tree plantations.

7.Sustainable agricultural practices are applied that do not pollute thebiosphere through accumulation of agrochemicals like syntheticfertilizer, pesticides, and herbicides in the soil, water or air. The use ofthese agrochemicals is minimized, which means that they are only usedwhen there is no biological or organic alternative and only in the mostefficient and most non-polluting way.

8.Plantations should promote conservation of water and soil fertility.The production of bioenergy crops should maintain soil fertility,avoid soil erosion, promote conservation of water resources, andhave minimal impacts on water availability and quality, and nutrientand mineral balances.

9.The expansion and development of new bioenergy crops should notintroduce any invasive species. Where there is doubt, theprecautionary principle should be applied.

If there are insufficient quantities of available biomass that meet thesecriteria, then the remaining biomass component in the Energy[R]evolution scenarios would be replaced with other forms of renewableenergy or enhanced conservation measures.

source DLR, WUPPERTAL INSTITUTE, ECOFYS; ROLE AND POTENTIAL OF RENEWABLE ENERGY AND ENERGY EFFICIENCY FOR GLOBAL ENERGY SUPPLY; COMMISSIONED BY THEGERMAN FEDERAL ENVIRONMENT AGENCY FKZ 3707 41 108, MARCH 2009; POTENTIAL VERSUS ENERGY DEMAND: S. TESKE a IEA 2009

table 7.3: technical potential by renewable energy technology for 2020, 2030 and 2050

World 2020

World 2030

World 2050

World energy demand 2007: 502.9 EJ/aa

Technical potential in 2050 versus world primary energy demand 2007.

SOLARCSP

1,125.9

1,351.0

1,688.8

3.4

SOLAR PV

5,156.1

6,187.3

8,043.5

16.0

HYDROPOWER

47.5

48.5

50.0

0.1

WIND ON-

SHORE

368.6

361.7

378.9

0.8

WINDOFF-

SHORE

25.6

35.9

57.4

0.1

OCEANENERGY

66.2

165.6

331.2

0.7

GEO-THERMAL ELECTRIC

4.5

13.4

44.8

0.1

GEO-THERMAL

DIRECT USES

498.5

1,486.6

4,955.2

9.9

SOLARWATER

HEATING

113.1

117.3

123.4

0.2

TECHNICAL POTENTIAL ELECTRICITY EJ/YEAR ELECTRIC POWER

TECHNICAL POTENTIALHEAT EJ/A

TECHNICALPOTENTIAL PRIMARY

ENERGY EJ/A

BIOMASSRESIDUES

58.6

68.3

87.6

0.2

BIOMASSENERGYCROPS

43.4

61.1

96.5

0.2

TOTAL

7,505

9,897

15,857

32

116 EREC, AND GREENPEACE INTERNATIONAL, ENERGY [R]EVOLUTION: A SUSTAINABLEWORLD ENERGY OUTLOOK, 2010.

90


7

energ

y resources &

security o

f supply

|SOLAR

RENEWABLE RESOURCE

LEGEND

REF

E[R]

0 1000 KM

NEEDED SOLAR AREA TOSUPPORT ENTIRE REGION

63,658 KM2


13,675 KM2

2007

2015

2020

2030

2040

2050

16,000

15,000

14,000

13,000

12,000

11,000

10,000

9,000

8,000

6,000

5,000

4,000

3,000

2,000

1,000

800

600

400

200

0

TW

h/a

YEARS 2007 - 2050

PRODUCTIONcomparison between the REF and adv. E[R]scenarios 2007 - 2050[electricity]

TWh/a

SOURCE GPI/EREC

0.03%0.03%

0.28%

0.87%

4.95%

0.53%

1.17%

15.17%

1.59%

27.28%

1.92%

36.11%

2007

2010

2020

2030

2040

2050

0.70

0.65

0.60

0.55

0.50

0.45

0.40

0.35

0.30

0.25

0.20

0.15

0.10

0.05

0

USD C

ENTS/k

Wh

YEARS 2007 - 2050

COSTcomparison between renewable and nonrenewable energies2007 - 2050

cents/kWh

SOURCE EPIA

pv

concentrating solar power plants (CSP)

coal

gas power plant

SOLAR

2000-2200

1800-2000

1600-1800

2600-2800

2400-2600

2200-2400

1400-1600

1200-1400

1000-1200

800-1000

600-800

400-600

200-400

0-200

RADIATION IN kW/hPER SQUARE METERSOURCE DLR

% PJ

OECD NORTH AMERICA

2007

2050

0.06M

1.04M

64H

1,343

2007

2050

40

646

% PJ

25M 17,683

8,508

kWh kWh

REF E[R]

% PJ

LATIN AMERICA

2007

2050

0.03

0.52

6

214

2007

2050

4

99

% PJ

14L 3,799L

1,758

kWh kWh

REF E[R]

ADV E[R] pv/concentrating solar power plants (CSP)

REF pv/concentrating solar power plants (CSP)

% total solar share

map 7.5: solar reference scenario and the advanced energy [r]evolution scenarioWORLDWIDE SCENARIO

REFERENCE SCENARIO


PRODUCTION PER REGION% OF GLOBAL SHARE | PETA JOULE [PJ]

PRODUCTION PER PERSON KILOWATT HOUR [kWh]


91

7

energ

y resources &

security o

f supply

|SOLAR


35,764 KM2


52,907 KM2


32,392 KM2


17,257 KM2


10,419 KM2


77,859 KM2


38,447 KM2

SOLAR AREA NEEDED TO SUPPORT ADV E[R] 2050 SCENARIO

390,122 KM2


47,743 KM2

2007

2015

2020

2030

2040

2050

275,000

250,000

225,000

200,000

175,000

150,000

125,000

100,000

75,000

50,000

25,000

0

PJ

YEARS 2007 - 2050

PRODUCTIONcomparison between the REF and adv. E[R]scenarios 2007 - 2050[primary energy]

PJ

SOURCE GPI/EREC

13%13%

16%

14%

23%

14%14%

39%

15%

60%

15%

80%

ADV E[R] solar

ADV E[R] renewables

REF solar

REF renewables

% total solar share

2007

2015

2020

2030

2040

2050

55,000

50,000

45,000

40,000

35,000

30,000

25,000

20,000

15,000

10,000

5,000

0

PJ

YEARS 2007 - 2050

PRODUCTIONcomparison between the REF and adv. E[R]scenarios 2007 - 2050[heat supply]

PJ

SOURCE GPI/EREC

0.27%0.27%

1.63%

0.35%

4.48%

0.54% 0.94%

12.17%

1.25%

22.54%

1.51%

33.58%

2007

2015

2020

2030

2040

2050

6,000

5,500

5,000

4,500

4,000

3,500

3,000

2,500

2,000

1,500

1,000

500

0

GW

YEARS 2007 - 2050

CAPACITYcomparison between the REF and adv. E[R]scenarios 2007 - 2050[electricity]

GW

SOURCE GPI/EREC

REF

ADV E[R]

% PJ

AFRICA

2007

2050

0.00

0.94

1

405

2007

2050

0.2

56L

% PJ

28 9,934

1,380

kWh kWh

REF E[R]

% PJ

INDIA

2007

2050

0.02L

0.23

6L

182

2007

2050

1

31

% PJ

24 13,262M

2,282

kWh kWh

REF E[R]

% PJ

OTHER ASIA

2007

2050

0.01L

0.58

4L

405

2007

2050

1L

74

% PJ

22 8,998

1,649L

kWh kWh

REF E[R]

% PJ

OECD PACIFIC

2007

2050

0.08

1.14

30M

466M

2007

2050

42

719H

% PJ

23 4,794

7,405

kWh kWh

REF E[R]

% PJ

GLOBAL

2007

2050

0.10

1.03

402

6,322

2007

2050

17

192

% PJ

23.26 108,367

2,468

kWh kWh

REF E[R]

% PJ


2007

2050

0.01L

0.10L

2

63L

2007

2050

2

56

% PJ

8,34 2,894

2,586

kWh kWh

REF E[R]

% PJ

CHINA

2007

2050

0.22L

0.95

182L

1,754H

2007

2050

38

342M

% PJ

20 21,628H

4,213

kWh kWh

REF E[R]

% PJ

MIDDLE EAST

2007

2050

0.17H

0.62

36

319

2007

2050

50H

251

% PJ

53H 14,696

11,552H

kWh kWh

REF E[R]

% PJ

OECD EUROPE

2007

2050

0.09M

1.42H

70

1,173

2007

2050

36M

567

% PJ

23 10,680

5,160M

kWh kWh

REF E[R]

ADV E[R] pv/concentrating solar power plants (CSP)

REF pv/concentrating solar power plants (CSP)

% total solar share

ADV E[R] solar collectors

REF solar collectors

% total solar share

DESIG



0.1%0.1%

0.6%0.2%

2.2%

0.3% 0.6%

7.2%

0.5%

15%

1%

23.3%

92


7

energ

y resources &

security o

f supply

|W

IND

map 8.6: wind reference scenario and the advanced energy [r]evolution scenarioWORLDWIDE SCENARIO

RENEWABLE RESOURCE

LEGEND

REF

E[R]

0 1000 KM

WIND

NEEDED WIND AREA TOSUPPORT ENTIRE REGION

159,459 KM2


60,791 KM2

% PJ

OECD NORTH AMERICA

2007

2050

0.12M

1.71

136

2,210

2007

2050

84

1,064

% PJ

11.11 7,805H

3,755

kWh kWh

REF E[R]

% PJ

LATIN AMERICA

2007

2050

0.02

0.65

3

266

2007

2050

2

123

% PJ

10.54 2,878

1,332

kWh kWh

REF E[R]

REFERENCE SCENARIO


>11 10-11 9-10

8-9 7-8 6-7

5-6 4-5 3-4

1-2 0-1 AVERAGE WIND SPEED INMETRES PER SECONDSOURCE DLR

PRODUCTION PER REGION % OF GLOBAL SHARE | PETA JOULE [PJ]

PRODUCTION PER PERSON KILOWATT HOUR [kWh]


2007

2010

2020

2030

2040

2050

0.12

0.11

0.10

0.09

0.08

0.07

0.06

0.05

0.04

0.03

0.02

0.01

0 USD C

ENTS/k

Wh

YEARS 2007 - 2050

COSTcomparison between renewable and nonrenewable energies2007 - 2050

cents/kWh

SOURCE GWEC

wind

coal

gas power plant

2007

2010

2020

2030

2040

2050

11,000

10,000

9,000

8,000

7,000

6,000

5,000

4,000

3,000

2,000

1,000

0

TW

h/a

YEARS 2007 - 2050

0.88%0.88%

11.07%

3.70 %

4.87%

2.78%

93

7

energ

y resources &

security o

f supply

|W

IND


17,029 KM2


27,757 KM2


58,118 KM2


56,656 KM2


64,644 KM2


140,621 KM2


96,571 KM2

WIND AREA NEEDED TO SUPPORT ADV E[R] 2050 SCENARIO

750,859 KM2


69,214 KM2

% PJ

AFRICA

2007

2050

0.02

0.47

4

202

2007

2050

1

28L

% PJ

3.00L 1,073L

149L

kWh kWh

REF E[R]

% PJ

INDIA

2007

2050

0.17

0.48

42M

374

2007

2050

10

64

% PJ

6.38 3,488

600

kWh kWh

REF E[R]

% PJ

ASIA

2007

2050

0.01

0.69

2L

475

2007

2050

0L

87

% PJ

8.75 3,557

652

kWh kWh

REF E[R]

% PJ

OECD PACIFIC

2007

2050

0.06

0.97M

24

396

2007

2050

33M

611

% PJ

15.47H 3,294M

5,089H

kWh kWh

REF E[R]

% PJ

GLOBAL

2007

2050

0.13

1.16

624

9,058

2007

2050

26

275

% PJ

8.38 39,029

1,182

kWh kWh

REF E[R]

% PJ


2007

2050

0.00

0.56

1

360

2007

2050

1

322M

% PJ

9.83 3,413

3,050

kWh kWh

REF E[R]

% PJ

CHINA

2007

2050

0.04

0.66

32

1,220M

2007

2050

7

238

% PJ

6.85M 7,340

1,430

kWh kWh

REF E[R]% PJ

MIDDLE EAST

2007

2050

0.00L

0.26L

1L

133L

2007

2050

1

105

% PJ

4.78 1,314

1,033

kWh kWh

REF E[R]

% PJ

OECD EUROPE

2007

2050

0.49H

4.14H

379H

3,420H

2007

2050

195H

1,652H

% PJ

10.41 4,867

2,352M

kWh kWh

REF E[R]

2007

2010

2020

2030

2040

2050

275,000

250,000

225,000

200,000

175,000

150,000

125,000

100,000

75,000

50,000

25,000

0

PJ

YEARS 2007 - 2050

PRODUCTIONcomparison between the REF and adv. E[R]scenarios 2007 - 2050[primary energy]

PJ

SOURCE GPI/GWEC

ADV E[R] wind

ADV E[R] renewables

REF wind

REF renewables

2007

2010

2020

2030

2040

2050

YEARS 2007 - 2050

PRODUCTIONcomparison between the REF and adv. E[R]scenarios 2007 - 2050[electricity]

TWh

SOURCE GWEC

4.48%

20.16%

5.00%

25.77%

5.41%

28.65%ADV E[R] wind

REF wind

2007

2010

2020

2030

2040

2050

4,000

3,500

3,000

2,500

2,000

1,500

1,000

500

0

GW

YEARS 2007 - 2050

CAPACITYcomparison between the REF and adv. E[R]scenarios 2007 - 2050[electricity]

GW

SOURCE GPI/GWEC

DESIG



ADV E[R] wind

REF wind

% REF total wind share

0.13%0.13%

0.81%0.45%

1.98%

0.62% 0.82%

4.22%

1.00%

6.37%

1.16%

8.38%13%13%

16%

14%

23%

14%14%

39%

15%

60%

15%

80%

94


“the technology is here, all we need is political will.”CHRIS JONESSUPORTER AUSTRALIA

FOSSIL FUEL TECHNOLOGIESNUCLEAR TECHNOLOGIESRENEWABLE ENERGY TECHNOLOGIES

GLOBAL

energy technologies

98image

BIOGAS FACILITY “SCHRADEN BIOGAS” IN GROEDEN NEAR DRESDEN, GERMANY.


“the technology is here, all we need is political will.”CHRISSUPPORTER, AUSTRALIA

95

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

8.1.2 gas combustion technologies

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

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

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

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

8.1.3 carbon reduction technologies

Whenever a fossil fuel is burned, carbon dioxide (CO2) is produced.Depending on the type of power plant, a large quantity of the gas willdissipate into the atmosphere and contribute to climate change. A hard-coal power plant discharges roughly 720 grammes of carbon dioxide perkilowatt-hour (g CO2/kWh), a modern gas-fired plant about 370 gCO2/kWh. One method, currently under development, to mitigate the CO2impact of fossil fuel combustion is called carbon capture and storage(CCS). It involves capturing CO2 from power plant smokestacks,compressing the captured gas for transport via pipeline or shipping andpumping it into underground geological formations for permanent storage.

While frequently touted as the solution to the carbon problem inherentin fossil fuel combustion, CCS for coal-fired power stations is unlikelyto be ready for at least another decade. Despite the “proof of concept”experiments currently in progress, the technology remains unproven as afully integrated process, in relation to all of its operational components.

Suitable and effective capture technology has not been developed andis unlikely to be commercially available any time soon; effective andsafe long-term storage on the scale necessary has not beendemonstrated; and serious concerns attach to the safety aspects oftransport and injection of CO2 into designated formations, while-longterm retention cannot reliably be assured.

This chapter describes the range of technologies available now and in thefuture to satisfy the world’s energy demand. The Energy [R]evolutionscenario is focused on the potential for energy savings and renewablesources, primarily in the electricity- and heat-generating sectors.

8.1 fossil fuel technologies

The most commonly used fossil fuels for power generation around theworld are coal and gas. Oil is still used where other fuels are notreadily available, for example islands or remote sites, or where thereis an indigenous resource. Together, coal and gas currently account forover half of global electricity supply.

8.1.1 coal combustion technologies

In a conventional coal-fired power station, pulverized or powderedcoal is blown into a combustion chamber where it is burned at hightemperature. The resulting heat is used to convert water flowingthrough pipes lining the boiler into steam. This drives a steam turbineand generates electricity. Over 90% of global coal-fired capacity usesthis system. Coal power stations can vary in capacity from a fewhundred megawatts up to several thousand.

A number of technologies have been introduced to improve theenvironmental performance of conventional coal combustion. Theseinclude coal cleaning (to reduce the ash content) and various “bolt-on” or“end-of-pipe” technologies to reduce emissions of particulates, sulphurdioxide 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 alkalinesorbent slurry, which is predominantly lime- or limestone-based.

More fundamental changes have been made to the way coal is burnedto both improve its efficiency and further reduce emissions ofpollutants. These include the following:

• integrated gasification combined cycle: Coal is not burned directlybut reacted with oxygen and steam to form a synthetic gas composedmainly of hydrogen and carbon monoxide. This is cleaned and thenburned in a gas turbine to generate electricity and produce steam todrive a steam turbine. IGCC improves the efficiency of coalcombustion from a level of 38–40% up to 50%.

• supercritical and ultrasupercritical: Power plants using thistechnique operate at higher temperatures than with conventionalcombustion, again increasing efficiency toward 50%.

• fluidised bed combustion: Coal is burned in a reactor comprisinga bed through which gas is fed to keep the fuel in a turbulent state.This improves combustion, heat transfer and the recovery of wasteproducts. By elevating pressures within a bed, a high-pressure gasstream can be used to drive a gas turbine, generating electricity.Emissions of both sulphur dioxide and nitrogen oxide can bereduced substantially.

• pressurised pulverized coal combustion: Mainly being developed inGermany, this system is based on the combustion of a finely groundcloud of coal particles, creating high-pressure, high-temperature steamfor power generation. The hot flue gases are used to generate electricityin a similar way to that of the combined cycle system.

energ

y technologies

|FOSSIL

FUEL T

ECHNOLOGIE

S

8

© GP/BAS BEENTJES

image THROUGH BURNING OF WOOD CHIPS THE POWERPLANT GENERATES ELECTRICITY, ENERGY OR HEAT.HERE WE SEE THE STOCK OF WOOD CHIPS WITH ACAPACITY OF 1000 M3 ON WHICH THE PLANT CAN RUN,UNMANNED, FOR ABOUT 4 DAYS. LELYSTAD, THE NETHERLANDS.

96


carbon storage and climate change targets Can carbon storagecontribute to climate change reduction targets? In order to avoiddangerous climate change, global greenhouse gas emissions need topeak by between 2015 and 2020 and fall dramatically thereafter.Power plants capable of capturing and storing CO2 are still beingdeveloped, however, and won’t become a reality for at least anotherdecade, if ever. This means that even if CCS works, the technologywould not make any substantial contribution towards protecting theclimate before 2020.

Power plant CO2 storage will also not be of any great help in attainingthe goal of a reduction of at least 80% in greenhouse gas by 2050 inOECD countries. Even if CCS were to be available in 2020, most of theworld’s new power plants will have just finished being modernized. Allthat could then be done would be for existing power plants to beretrofitted and CO2 captured from the waste gas flow. Retrofitting powerplants would be an extremely expensive exercise. “Capture-ready” powerplants are equally unlikely to increase the prospect of retrofitting existing fleets with capture technology.

The conclusion reached in the Energy [R]evolution scenario is thatrenewable energy sources are already available, in many casescheaper, and lack the negative environmental impacts associated withfossil fuel exploitation, transport and processing. It is renewableenergy together with energy efficiency and energy conservation, andnot carbon capture and storage, that has to increase worldwide sothat the primary cause of climate change—the burning of fossil fuelslike coal, oil and gas—is stopped.

Greenpeace opposes any CCS efforts which lead to:

• public financial support of CCS, at the expense of funding renewableenergy development and investment in energy efficiency;

• the stagnation of renewable energy, energy efficiency and energyconservation improvements;

• inclusion of CCS in the Kyoto Protocol’s Clean DevelopmentMechanism (CDM), as it would divert funds away from the statedintention of the mechanism, and cannot be considered cleandevelopment under any coherent definition of this term; or

• the promotion of this possible future technology as the only majorsolution to climate change, thereby leading to new fossil fueldevelopments (especially lignite- and black coal–fired power plants) and an increase in emissions in the short to medium terms.

Deploying the technology on coal power plants is likely to doubleconstruction costs, increase fuel consumption by 10–40%, consumemore water, generate more pollutants and ultimately require thepublic sector to ensure that the CO2 stays where it has been buried. Ina similar way to the disposal of nuclear waste, CCS involves creatinga scheme whereby future generations monitor in perpetuity theclimate pollution produced by their predecessors.

8.1.4 carbon dioxide storage

In order to benefit the climate, captured CO2 has to be stored somewherepermanently. Current thinking is that it can be pumped under the earth’ssurface at a depth of over 3,000 feet into geological formations, such assaline aquifers. However, the volume of CO2 that would need to becaptured and stored is enormous—a single coal-fired power plant canproduce seven million tonnes of CO2 annually.

It is estimated that a single “stabilization wedge” of CCS (enough toreduce carbon emissions by one billion metric tons per year by 2050)would require a flow of CO2 into the ground equal to the current flowout of the ground—and in addition to the associated infrastructure tocompress, transport and pump it underground. It is still not clear thatit will be technically feasible to capture and bury this much carbon,both in terms of the number of storage sites and whether they will belocated close enough to power plants.

Even if it is feasible to bury hundreds of thousands of megatons ofCO2, there is no way to guarantee that storage locations will beappropriately designed and managed over the timescales required. Theworld has limited experience of storing CO2 underground; the longest-running storage project, at Sleipner in the Norweigian North Sea,began operation only in 1996. This is particularly concerning becauseas long as CO2 is present in geological sites, there is a risk of leakage.Although leakages are unlikely to occur in well-characterized, -managed and -monitored sites, permanent storage stability cannot beguaranteed, since tectonic activity and natural leakage over longtimeframes are impossible to predict.

Sudden leakage of CO2 can be fatal. Carbon dioxide is not itselfpoisonous, and is contained in the air we breathe (at a concentration ofapproximately 0.04 %). But as concentrations increase, it displaces thevital oxygen in the air. Air with concentrations of 7 to 8% CO2 byvolume causes death by suffocation after 30 to 60 minutes.

There are also health hazards when large amounts of CO2 areexplosively released. Although the gas normally disperses quickly afterleaking, it can accumulate in depressions in the landscape or in closedbuildings, since carbon dioxide is heavier than air. It is equallydangerous when it escapes more slowly and without being noticed inresidential areas; for example, in cellars below houses.

The dangers from such leaks are known from natural volcanic CO2

degassing. Gas escaping at Lake Nyos (a crater lake in Cameroon,Africa) in 1986 killed over 1,700 people. At least ten people havedied in the Lazio region of Italy in the last 20 years as a result of CO2

being released.

8

energ

y technologies

|FOSSIL

FUEL T

ECHNOLOGIE

S

energ

y technologies

|NUCLEAR T

ECHNOLOGIE

S

8

97

© ARNOLD/VISUM/GP

image BROWN COAL SURFACE MININGIN HAMBACH, GERMANY. GIANT COALEXCAVATOR AND SPOIL PILE.

8.2 nuclear technologies

Generating electricity from nuclear power involves transferring theheat produced by a controlled nuclear fission reaction into aconventional steam turbine generator. The nuclear reaction takesplace inside a core and surrounded by a containment vessel of varyingdesign 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 generalslowdown in building new nuclear power stations. This has beencaused by a variety of factors, in particular: fear of a nuclearaccident, following the events at Three Mile Island, Chernobyl andMonju; and increased scrutiny of economics and environmentalfactors, such as waste management and radioactive discharges.

8.2.1 nuclear reactor designs: evolution and safety issues

Currently, there are 441 nuclear power reactors operating in 30countries around the world.117 Although there are dozens of differentreactor designs and sizes, there are three broad categories eithercurrently deployed or under development. These are:

Generation I: Prototype commercial reactors developed in the 1950sand 1960s as modified or enlarged military reactors, originally eitherfor submarine propulsion or plutonium production.

Generation II: Mainstream reactor designs in commercial operationworldwide.

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 underconstruction or planned. About 20 different designs are reported tobe under development118, most of them “evolutionary” designs derivedfrom Generation II reactor types, with some modifications butwithout introducing drastic changes. Some of them represent more-innovative approaches. According to the World Nuclear Association,reactors of Generation III are characterized by the following:

• a standardized design for each type, to expedite licensing andreduce capital cost and construction time;

• a simpler and more rugged design, making them easier to operateand 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; and

• burnable absorbers (“poisons”), to extend fuel life.119

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 IIdesigns, and is to be launched in France and Germany.120 The statedgoals for this design are: to improve safety levels—in particular, toreduce the probability of a severe accident by a factor of ten; toachieve mitigation from severe accidents by restricting theirconsequences to the plant itself; and to reduce costs. Compared to itspredecessors, however, the EPR displays several modifications whichconstitute a reduction of safety margins, including the following:

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

• The thermal output of the plant has been increased by 15%,relative to existing French reactors, by increasing core outlettemperature, letting the main coolant pumps run at higher capacityand modifying the steam generators.

• There are fewer redundant pathways in the safety systems than in a German Generation II reactor.

Several other modifications are hailed as substantial safetyimprovements, including a “core catcher” system to control ameltdown accident. Nonetheless, in spite of the changes beingenvisaged, there is no guarantee that the safety level of the EPRactually represents a significant improvement. In particular, reductionof the expected core-melt probability by a factor of ten is not proven.Furthermore, there are serious doubts as to whether mitigation andcontrol of a core melt accident by using the core catcher concept willactually work.

Finally, Generation IV Generation IV reactors are currently beingdeveloped with the aim of commercialization in 20–30 years.

117 INTERNATIONAL ATOMIC ENERGY AGENCY, POWER REACTOR INFORMATION SYSTEMDATABASE.118 IAEA 2004; WNO 2004A119 WORLD NUCLEAR ASSOCIATION, ADVANCED NUCLEAR POWER REACTORS, ONLINE AT<HTTP://WWW.WORLD-NUCLEAR.ORG/INFO/INF08.HTML>.120 HAINZ 2004.

8.3 renewable energy technologies

Renewable energy covers a range of natural sources which areconstantly renewed and therefore, unlike fossil fuels and uranium, willnever be exhausted. Most of them derive from the effect of the sun andmoon on the earth’s weather patterns. They also produce none of theharmful emissions and pollution associated with “conventional” fuels.Although hydroelectric power has been used on an industrial scale sincethe middle of the last century, the serious exploitation of otherrenewable sources has a more recent history.

8.3.1 solar power (photovoltaics)

There is more than enough solar radiation available all over the world tosatisfy a vastly increased demand for solar power systems. The sunlightwhich reaches the earth’s surface is enough to provide 2,850 times asmuch energy as we can currently use. On a global average, each squaremetre of land is exposed to enough sunlight to produce 1,700 kWh ofpower every year. The average irradiation in Europe is about 1,000 kWhper square metre, however, compared with 1,800 kWh in the Middle East.

Photovoltaic (PV) technology involves the generation of electricity fromlight. The essence of this process is the use of a semiconductor materialwhich can be adapted to release electrons, the negatively charged particlesthat form the basis of electricity. The most common semiconductormaterial used in photovoltaic cells is silicon, an element most commonlyfound in sand. All PV cells have at least two layers of suchsemiconductors, one positively charged and one negatively charged. Whenlight shines on the semiconductor, the electric field across the junctionbetween these two layers causes electricity to flow. The greater theintensity of the light, the greater the flow of electricity. A photovoltaicsystem does not therefore need bright sunlight in order to operate, and cangenerate electricity even on cloudy days. Solar PV is different from a solarthermal collecting system (see below), where the sun’s rays are used togenerate heat, usually for hot water in a house, swimming pool, etc.

The most important parts of a PV system are: the cells, which formthe basic building blocks; the modules, which bring together largenumbers of cells into a unit; and, in some situations, the invertersused to convert the electricity generated into a form suitable foreveryday use. When a PV installation is described as having acapacity of 3 kWp (p = peak), this refers to the output of the systemunder standard testing conditions, allowing comparison betweendifferent modules. In central Europe a 3 kWp–rated solar electricitysystem, with a surface area of approximately 27 square metres, wouldproduce enough power to meet all the electricity demand of anenergy-conscious household.

There are several different PV technologies and types of installed system.

technologies

• crystalline silicon technology Crystalline silicon cells are madefrom thin slices cut from a single crystal of silicon (mono-crystalline) or from a block of silicon crystals (polycrystalline, ormulti-crystalline). This is the most common technology, representingabout 80% of the market today. In addition, this technology alsoexists in the form of ribbon sheets.

• thin film technology Thin-film modules are constructed bydepositing extremely thin layers of photosensitive materials onto asubstrate such as glass, stainless steel or flexible plastic. The latteropens up a range of applications, especially for building integration(roof tiles) and end-consumer purposes. Four types of thin-filmmodules are commercially available at the moment: amorphoussilicon, cadmium telluride, copper indium/galliumdiselenide/disulphide, and multi-junction cells.

• other emerging cell technologies (at the development or earlycommercial stage): These include concentrated photovoltaic,consisting of cells built into concentrating collectors that use a lensto focus the concentrated sunlight onto the cells; and organic solarcells, wherein the active material consists at least partially oforganic dye, small volatile organic molecules, or polymer.

systems

• grid connected The most popular type of solar PV system for homesand businesses in the developed world. Connection to the localelectricity network allows any excess power produced to be sold to theutility. Electricity is then imported from the network outside daylighthours. An inverter is used to convert the DC power produced by thesystem to AC power for running normal electrical equipment.

• grid support A system can be connected to the local electricity networkas well as to a back-up battery. Any excess solar electricity produced afterthe battery has been charged is then sold to the network. This system isideal for use in areas of unreliable power supply.

• off-grid Completely independent of the grid, the system isconnected to a battery via a charge controller, which stores theelectricity generated and acts as the main power supply. An invertercan be used to provide AC power, enabling the use of normalappliances. Typical off-grid applications are repeater stations formobile phones or rural electrification. Rural electrification refers toeither small, solar home systems covering basic electricity needs orsolar mini-grids, which are larger solar electricity systems thatprovide electricity for several households.

98


figure 8.1: photovoltaics technology

1. LIGHT (PHOTONS)

2. FRONT CONTACT GRID

3. ANTI-REFLECTION COATING

4. N-TYPE SEMICONDUCTOR

5. BOARDER LAYOUT

6. P-TYPE SEMICONDUCTOR

7. BACKCONTACT

1

2

345

6

7

8

energ

y technologies

|RENEW

ABLE E

NERGY T

ECHNOLOGIE

S

99

energ

y technologies

|RENEW

ABLE E

NERGY T

ECHNOLOGIE

S

8

© GP/SOLNESS

image SOLAR PROJECT IN PHITSANULOK, THAILAND. SOLAR FACILITY OF THEINTERNATIONAL INSTITUTE AND SCHOOL FOR RENEWABLE ENERGY.

image SOLAR PANELS ON CONISTON STATION, NORTH WEST OF ALICE SPRINGS,NORTHERN TERRITORY.

© CHRISTIAN KAISER/GP

• hybrid system A solar system can be combined with anothersource of power—a biomass generator, a wind turbine or dieselgenerator—to ensure a consistent supply of electricity. A hybridsystem can be grid-connected, stand-alone or grid support.

8.3.2 concentrating solar power (CSP)

Concentrating solar power (CSP) plants, also called solar thermalpower plants, produce electricity in much the same way asconventional power stations. They obtain their energy input byconcentrating solar radiation and converting it to high-temperaturesteam or gas to drive a turbine or motor engine. Large mirrorsconcentrate sunlight into a single line or point. The heat created thereis used to generate steam. This hot, highly pressurised steam is usedto power turbines which generate electricity. In sun-drenched regions,CSP plants can guarantee a large proportion of electricityproduction.

Four main elements are required: a concentrator, a receiver, someform of transfer medium or storage, and power conversion. Manydifferent types of system are possible, including combinations withother renewable and non-renewable technologies, but there are fourmain groups of solar thermal technologies:

• parabolic trough Parabolic trough plants use rows of parabolictrough collectors, each of which reflect the solar radiation into anabsorber tube. Synthetic oil circulates through the tubes, heating upto approximately 400°C. This heat is then used to generateelectricity. Some of the plants under construction have beendesigned to not only produce power during sunny hours but alsostore energy, allowing the plants to produce an additional 7.5 hoursof nominal power after sunset, which dramatically improves theirintegration into the grid. Molten salts are normally used as storagefluid in a hot-and-cold two-tank concept. Plants in operation inEurope: Andasol 1 and 2 (50 MW +7.5 hour storage each);Puertollano (50 MW); Alvarado (50 MW); and Extresol 1 (50MW + 7.5 hour storage).

• central receiver, or solar tower A circular array of heliostats(large, individually tracking mirrors) is used to concentrate sunlightonto a central receiver mounted at the top of a tower. A heat-transfer medium absorbs the highly concentrated radiation reflectedby the heliostats and converts it into thermal energy to be used forthe subsequent generation of superheated steam for turbineoperation. To date, the heat transfer media demonstrated includewater/steam, molten salts, liquid sodium, and air. If pressurised gasor air is used at very high temperatures of about 1,000°C or moreas the heat transfer medium, it can even be used to directly replacenatural gas in a gas turbine, thus making use of the excellentefficiency (60%+) of modern, gas and steam combined cycles.

Solar tower developers now feel confident that after anintermediate scaling-up to 30 MW capacity, grid-connected towerpower plants can be built up to a capacity of 200 MW solar-onlyunits. Use of heat storage will increase their flexibility. Althoughsolar tower plants are considered to be further fromcommercialization than parabolic trough systems, they have goodlonger-term prospects for high conversion efficiencies. Projects arebeing developed in Spain, South Africa and Australia.

• parabolic dish A dish-shaped reflector is used to concentratesunlight onto a receiver located at its focal point. The concentratedbeam radiation is absorbed into the receiver to heat a fluid or gasto approximately 750°C. This is then used to generate electricity ina small piston, Stirling engine or micro-turbine, attached to thereceiver. The potential of parabolic dishes is intended primarily fordecentralized power supply and remote, stand-alone power systems.Projects are currently planned in the United States, Australia andEurope.

• linear fresnel systems These systems comprise collectorsresembling parabolic troughs, with a similar power generationtechnology, using a field of horizontally mounted flat mirror strips,collectively or individually tracking the sun. There is one plantcurrently in operation in Europe: Puerto Errado (2 MW).

PARABOLICTROUGH

REFLECTOR

ABSORBER TUBE

SOLAR FIELD PIPING

PARABOLIC DISH

CENTRAL RECEIVER

HELIOSTATS

REFLECTOR

CENTRAL RECEIVER

RECEIVER/ENGINE

figures 8.2: csp technologies: parabolic trough, central receiver/solar tower and parabolic dish

100


8.3.3 solar thermal collectors

Solar thermal collecting systems are based on a centuries-oldprinciple: the sun heats up water contained in a dark vessel. Solarthermal technologies on the market now are efficient and highlyreliable, providing energy for a wide range of applications—fromdomestic hot water and space heating in residential and commercialbuildings to swimming pool heating, solar-assisted cooling, industrialprocess heat, and the desalination of drinking water.

Although mature products exist to provide domestic hot water andspace heating using solar energy, in most countries they are not yetthe norm. Integrating solar thermal technologies into buildings at thedesign stage or when the heating (and cooling) system is beingreplaced is crucial, thus lowering the installation cost. Moreover, theuntapped potential in the non-residential sector will be opened up asnewly developed technology becomes commercially viable.

solar domestic hot water and space heating Domestic hot waterproduction is the most common application. Depending on theconditions and the system’s configuration, most of a building’s hotwater requirements can be provided by solar energy. Larger systemscan additionally cover a substantial part of the energy needed forspace heating. There are two main types of technology:

• vacuum tubes The absorber inside the vacuum tube absorbsradiation from the sun and heats up the fluid inside. Additionalradiation is picked up from the reflector behind the tubes. Whateverthe angle of the sun, the round shape of the vacuum tube allows itto reach the absorber. Even on a cloudy day, when the light iscoming from many angles at once, the vacuum tube collector canstill be effective.

• flat panel This is basically a box with a glass cover which sits onthe roof like a skylight. Inside is a series of copper tubes withcopper fins attached. The entire structure is coated in a blacksubstance designed to capture the sun’s rays. These rays heat up awater and antifreeze mixture which circulates from the collectordown to the building’s boiler.

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

8.3.4 wind power

Over the last 20 years, wind energy has become the world’s fastestgrowing energy source. Today’s wind turbines are produced by asophisticated mass production industry employing a technology that isefficient, cost effective and quick to install. Turbine sizes range from afew kW to over 5,000 kW, with the largest turbines reaching morethan 100 m in height. One large wind turbine can produce enoughelectricity for about 5,000 households. State-of-the-art wind farmstoday can be as small as a few turbines and as large as severalhundred megawatts.

The global wind resource is enormous, capable of generating moreelectricity than the world’s total power demand, and well distributedacross the five continents. Wind turbines can be operated not just inthe windiest coastal areas but in countries which have no coastlines,including regions such as central Eastern Europe, central North andSouth America, and central Asia. The wind resource out at sea is evenmore productive than on land, encouraging the installation of offshorewind parks with foundations embedded in the ocean floor. InDenmark, a wind park built in 2002 uses 80 turbines to produceenough electricity for a city with a population of 150,000.

Smaller wind turbines can produce power efficiently in areas thatotherwise have no access to electricity. This power can be useddirectly or stored in batteries. New technologies for using the wind’spower are also being developed for exposed buildings in denselypopulated cities.

wind turbine design Significant consolidation of wind turbine designhas taken place since the 1980s. The majority of commercial turbinesnow operate on a horizontal axis, with three evenly spaced blades.These are attached to a rotor from which power is transferredthrough a gearbox to a generator. The gearbox and generator arecontained within a housing called a nacelle. Some turbine designsavoid a gearbox by using direct drive. The electricity output is thenchannelled down the tower to a transformer and eventually into thelocal grid network.

Wind turbines can operate from a wind speed of 3–4 metres persecond (m/s) up to about 25 m/s. Limiting their power at high windspeeds is achieved either by “stall” regulation—reducing the poweroutput—or “pitch” control—changing the angle of the blades so thatthey no longer offer any resistance to the wind. Pitch control hasbecome the most common method. The blades can also turn at aconstant or variable speed, with the latter enabling the turbine tofollow more closely the changing wind speed.

figure 8.3: flat panel solar technology

8

energ

y technologies

|RENEW

ABLE E

NERGY T

ECHNOLOGIE

S

101

energ

y technologies

|RENEW

ABLE E

NERGY T

ECHNOLOGIE

S

8

© GP/RODA ANGELES

© P. PETERSEN/DREAMSTIMEimage SOLAR PANELS FEATURED IN A RENEWABLE ENERGY EXHIBIT ON BORACAY

ISLAND, ONE OF THE PHILIPPINES’ PREMIER TOURIST DESTINATIONS.

image VESTAS VM 80 WIND TURBINES AT AN OFFSHORE WIND PARK IN THE WESTERNPART 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, and

• offshore expansion.

Although the existing offshore market represents only just over 1% ofthe world’s land-based installed wind capacity, the latestdevelopments in wind technology are primarily driven by thisemerging potential. This means that the focus is on the most effectiveways to make very large turbines.

Modern wind technology is available for a range of sites—low and highwind speeds, desert and arctic climates. European wind farms operatewith high availability, are generally well integrated into the environmentand are accepted by the public. In spite of repeated predictions of alevelling off at an optimum mid-range size, and the fact that windturbines cannot get larger indefinitely, turbine size has increased yearon year—from units of 20–60 kW in California in the 1980s up to thelatest multi-MW machines with rotor diameters over 100 m. Theaverage size of turbine installed around the world during 2009 was1,599 kW, while the largest machine in operation is the Enercon E126,with a rotor diameter of 126 m and a power capacity of 6 MW.

This growth in turbine size has been matched by the expansion ofboth markets and manufacturers. More than 150,000 wind turbinesnow operate in over 50 countries around the world. The US market iscurrently the largest, but there has also been impressive growth inGermany, Spain, Denmark, India and China.

8.3.5 biomass energy

Biomass is a broad term used to describe material of recentbiological origin that can be used as a source of energy. This includeswood, crops, algae and other plants, as well as agricultural and forestresidues. Biomass can be used for a variety of end uses: heating,electricity generation, or as fuel for transportation. The term“bioenergy” is used for biomass energy systems that produce heatand/or electricity and “biofuels” for liquid fuels used in transport.Biodiesel manufactured from various crops has become increasinglyused as vehicle fuel, especially as the cost of oil has risen.

Biological power sources are renewable, easily stored, and, if sustainablyharvested, low-carbon. This is because the gas emitted during their transferinto useful energy can be offset by the carbon dioxide absorbed if, and onlyif, new plants are grown to replace them. There are also significantbiodiversity benefits associated with the natural systems from whichbiomass is harvested that must be respected.

Electricity-generating biomass power plants work just like natural gasor coal power stations, except that the fuel must be processed beforeit can be burned. These power plants are generally not as large ascoal power stations because their fuel supply needs to grow as near aspossible to the plant. Heat generation from biomass power plants canresult either from utilizing a combined heat and power (CHP) system,piping the heat to nearby homes or industry, or through dedicatedheating systems. Small heating systems using specially producedpellets made from waste wood, for example, can be used to heatsingle family homes instead of natural gas or oil.

biomass technology A number of processes can be used to convertenergy from biomass. These divide into two types of system: thermal,which involves direct combustion of solids, liquids or a gas, viapyrolysis or gasification; and biological, which involves decompositionof solid biomass to liquid or gaseous fuels by processes such asanaerobic digestion and fermentation.figure 8.4: wind turbine technology

figure 8.5: biomass technology

1. HEATED MIXER

2. CONTAINMENT FOR FERMENTATION

3. BIOGAS STORAGE

4. COMBUSTION ENGINE

5. GENERATOR

6.WASTE CONTAINMENT

1. ROTOR BLADE

2. BLADE ADJUSTMENT

3. NACELL

4. ROTOR SHAFT

5.WIND MEASUREMENT

6. GENERATOR

7. SYSTEM CONTROL

8. LIFT

1

2

3

4 5 6

1

2

3

4

5

67

8

• thermal systems Direct combustion is the most common way of converting biomassinto energy, for heat as well as electricity. Worldwide, it accounts forover 90% of biomass generation. Technologies can be distinguishedas either fixed bed, fluidized-bed or entrained-flow combustion. Infixed-bed combustion, such as in a grate furnace, primary air passesthrough a fixed bed in which drying, gasification and charcoalcombustion takes place. The combustible gases produced are burnedafter the addition of secondary air, usually in a zone separated fromthe fuel bed. In fluidized-bed combustion, the primary combustion airis injected from the bottom of the furnace with such high velocitythat the material inside the furnace becomes a seething mass ofparticles and bubbles. Entrained-flow combustion is suitable for fuelsavailable as small particles, such as sawdust or fine shavings, whichare pneumatically injected into the furnace.

Gasification Biomass fuels are increasingly being used withadvanced conversion technologies, such as gasification systems,which offer superior efficiencies, compared with conventional powergeneration. Gasification is a thermochemical process in whichbiomass is heated with little or no oxygen present, to produce alow-energy gas. The gas can then be used to fuel a gas turbine orcombustion engine to generate electricity. Gasification can alsodecrease emission levels, compared to power production with directcombustion and a steam cycle.

Pyrolysis is a process whereby biomass is exposed to hightemperatures in the absence of air, causing the biomass todecompose. The products of pyrolysis always include gas(“biogas”), liquid (‘bio-oil’) and solid (“char”), with the relativeproportions of each dependent on the fuel characteristics, themethod of pyrolysis, and the reaction parameters, such astemperature and pressure. Lower temperatures produce more solidand liquid products, and higher temperatures more biogas.

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

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

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

Biomass power station capacities typically range up to 15 MW, butlarger plants are possible, of up to 400 MW capacity, with part ofthe fuel input potentially being fossil fuel, for example pulverizedcoal. The world’s largest biomass-fuelled power plant is located atPietarsaari, in Finland. Built in 2001, this is an industrial CHP plantproducing steam (100 MWth) and electricity (240 MWe) for thelocal forest industry and district heat for the nearby town. The boileris a circulating fluidized-bed boiler designed to generate steam frombark, sawdust, wood residues, commercial biofuel, and peat.

A 2005 study commissioned by Greenpeace Netherlands concludedthat it was technically possible to build and operate a 1,000-MW,biomass-fired power plant using fluidized-bed combustiontechnology and fed with wood residue pellets.121

biofuels Converting crops into ethanol and into biodiesel made fromrapeseed methyl ester (RME) currently takes place mainly in Brazil, theUS and Europe. Processes for obtaining synthetic fuels from “biogenicsynthesis” gases will also play a larger role in the future. Theoretically,biofuels can be produced from any biological carbon source, although themost common are photosynthetic plants. Various plants and plant-derivedmaterials are used for biofuel production.

Globally, biofuels are most commonly used to power vehicles but they canalso be used for other purposes. The production and use of biofuels mustresult in a net reduction in carbon emissions, compared to the use oftraditional fossil fuels, in order to have a positive effect of climate changemitigation. Sustainable biofuels can reduce the dependency on petroleumand thereby enhance energy security.

• bioethanol is a fuel manufactured through the fermentation ofsugars. This is done by accessing sugars directly (sugar cane orbeet) or by breaking down starch in grains such as wheat, rye,barley or maize. In the European Union, bioethanol is mainlyproduced from grains, with wheat as the dominant feedstock. InBrazil, the preferred feedstock is sugar cane, whereas in the US itis corn (maize). Bioethanol produced from cereals has a by-productthat is a protein-rich animal feed called dried distillers grains withsolubles (DDGS). For every tonne of cereals used for ethanolproduction, on average one third will enter the animal feed streamas DDGS. Because of its high protein level, DDGS is currently usedas a replacement for soy cake. Bioethanol can either be blendedinto gasoline (petrol) directly or be used in the form of ETBE(ethyl tertiary butyl ether).

• biodiesel is a fuel produced from vegetable oil sourced fromrapeseed, sunflower seeds or soybeans, as well as from used cookingoils or animal fats. Recycling of used vegetable oils as feedstock forbiodiesel production can reduce pollution from discarded oil andprovide a new way of transforming a waste product into transportenergy. Blends of biodiesel and conventional hydrocarbon-baseddiesel are the most common products distributed in the retailtransport fuel market.

Most countries use a labelling system to explain the proportion ofbiodiesel in any fuel mix. Fuel containing 20% biodiesel is labelledB20, while pure biodiesel is referred to as B100. Blends of 20%biodiesel with 80% petroleum diesel (B20) can generally be used inunmodified diesel engines. To use the pure form (B100), an enginemay require certain modifications. Biodiesel can also be used as aheating fuel in domestic and commercial boilers. Older furnaces maycontain rubber parts that would be affected by biodiesel's solventproperties, but can otherwise burn it without any conversion.

102


121 GREENPEACE NETHERLANDS, OPPORTUNITIES FOR 1,000 MWE BIOMASS-FIREDPOWER PLANT IN THE NETHERLANDS, 2005.

8

energ

y technologies

|RENEW

ABLE E

NERGY T

ECHNOLOGIE

S

103

energ

y technologies

|RENEW

ABLE E

NERGY T

ECHNOLOGIE

S

8

8.3.6 geothermal energy

Geothermal energy is heat-derived, from deep underneath the earth’scrust. In most areas, this heat reaches the surface in a very diffusestate. However, due to a variety of geological processes, some areas,including the western part of the US, west and central Eastern Europe,Iceland, Asia and New Zealand, are underlain by relatively shallowgeothermal resources. These are classified as either low temperature(less than 90°C), moderate temperature (90°–150°C) or hightemperature (greater than 150°C). The uses to which these resourcescan be put depend on the temperature. The highest temperature isgenerally used only for electric power generation. Current globalgeothermal generation capacity totals approximately 10,700 MW, andthe leading country is currently the US, with over 3,000 MW, followedby the Philippines (1,900 MW) and Indonesia (1,200 MW). Low- andmoderate-temperature resources can be used either directly or throughground-source heat pumps.

Geothermal power plants use the earth’s natural heat to vaporizewater or an organic medium. The steam created then powers a turbinewhich produces electricity. In the US, New Zealand and Iceland, thistechnique has been used extensively for decades. In Germany, where itis necessary to drill many kilometres down to reach the necessarytemperatures, it is only in the trial stages. Geothermal heat plantsrequire lower temperatures and the heated water is used directly.

8.3.7 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 hydropower. Large hydroelectric power plants with concrete dams andextensive collecting lakes often have very negative effects on theenvironment, however, requiring the flooding of habitable areas.Smaller “run-of-the-river” power stations, which are turbines poweredby one section of running water in a river, can produce electricity inan environmentally friendly way.

The main requirement for hydro power is to create an artificial headso that water, diverted through an intake channel or piped into aturbine, discharges back into the river downstream. Small hydropower is mainly run-of-the-river, and does not collect significantamounts of stored water, which would require the construction oflarge dams and reservoirs. There are two broad categories of turbines.In an impulse turbine (notably the Pelton), a jet of water impinges onthe runner, which is designed to reverse the direction of the jet andthereby extracts momentum from the water. This turbine is suitablefor high heads and “small” discharges. Reaction turbines (notablyFrancis and Kaplan) run full of water and in effect generatehydrodynamic “lift” forces to propel the runner blades. These turbinesare suitable for medium to low heads and medium to largedischarges.

figure 8.6: geothermal technology figure 8.7: hydro technology

1. PUMP

2. HEAT EXCHANGER

3. GAS TURBINE & GENERATOR

4. DRILLING HOLE FOR COLD WATER INJECTION

5. DRILLING HOLE FOR WARM WATER EXTRACTION

1. INLET

2. SIEVE

3. GENERATOR

4. TURBINE

5. HEAD

6. OUTLET

1 23

4 5

12

3

4

5

6

© GP/RODRIGO BALÉIA

image THE BIOENERGY VILLAGE OF JUEHNDE WHICH WAS THE FIRST COMMUNITY INGERMANY TO PRODUCE ALL ITS ENERGY NEEDED FOR HEATING AND ELECTRICITY,WITH CO2 NEUTRAL BIOMASS.

image A NEWLY DEFORESTED AREA WHICH HAS BEEN CLEARED FOR AGRICULTURALEXPANSION IN THE AMAZON, BRAZIL.


8.3.8 ocean energy

tidal power Tidal power can be harnessed by constructing a dam orbarrage across an estuary or bay with a tidal range of at least fivemetres. Gates in the barrage allow the incoming tide to build up in abasin behind it. The gates then close so that when the tide flows outthe water can be channelled through turbines to generate electricity.Tidal barrages have been built across estuaries in France, Canada andChina but a mixture of high-cost projections coupled withenvironmental objections to the effect on estuarial habitats haslimited the technology’s further expansion.

wave and tidal stream power In wave power generation, a structureinteracts with the incoming waves, converting this energy to electricitythrough a hydraulic, mechanical or pneumatic power-take-off system.The structure is kept in position by a mooring system or is placeddirectly on the seabed or seashore. Power is transmitted to the seabedby a flexible submerged electrical cable and to shore by a sub-sea cable.

In tidal stream generation, a machine similar to a wind turbine rotoris fitted underwater to a column fixed to the sea bed; the rotor thenrotates to generate electricity from fast-moving currents. Prototypesof 300 kW are in operation in the UK.

Wave power converters can be made up from connected groups ofsmaller generator units of 100–500 kW, or several mechanical orhydraulically interconnected modules can supply a single largerturbine generator unit of 2–20 MW. The large waves needed to makethe technology more cost-effective are mostly found at greatdistances from the shore, however, requiring costly sub-sea cables totransmit the power. The converters themselves also take up largeamounts of space. Wave power has the advantage of providing a morepredictable supply than wind energy and can be located in the oceanwithout much visual intrusion.

There is no commercially leading technology on wave powerconversion at present. Different systems are being developed at seafor prototype testing. The largest grid-connected system installed sofar is the 2.25 MW Pelamis, with linked semi-submerged cyclindricalsections, operating off the coast of Portugal. Most development workhas been carried out in the UK.

Wave energy systems can be divided into three groups, described below.

• shoreline devices are fixed to the coast or embedded in theshoreline, with the advantage of easier installation andmaintenance. They also do not require deep-water moorings or longlengths of underwater electrical cable. The disadvantage is that theyexperience a much less powerful wave regime. The most advancedtype of shoreline device is the oscillating water column (OWC). Oneexample is the Pico plant, a 400 kW–rated shoreline OWCequipped with a Wells turbine, constructed in the 1990s. Anothersystem that can be integrated into a breakwater is the SeawaveSlot-Cone converter.

• near shore devices are deployed at moderate water depths (~20–25m) at distances up to ~500 m from the shore. They have the sameadvantages as shoreline devices but are exposed to stronger, more-productive waves. This category includes “point absorber systems.”

• offshore devices exploit the more powerful wave regimes available indeep water (>25 m depth). More-recent designs for offshore devicesconcentrate on small, modular devices that yield high power outputwhen deployed in arrays. One example is the AquaBuOY system, afreely floating, heaving point absorber system that reacts against asubmersed tube, filled with water. Another example is the WaveDragon, which uses a wave reflector design to focus the wave towardsa ramp and fill a higher-level reservoir.

104


8

energ

y technologies

|RENEW

ABLE E

NERGY T

ECHNOLOGIE

S

© MAXFX/DREAMSTIME

© MCDONNELL/ISTOCK

© USCHI HERING/DREAMSTIME

images 1. BIOMASS CROPS. 2. OCEAN ENERGY. 3. CONCENTRATING SOLAR POWER (CSP).

1

2 3

9

9climate and energy policy recommendations

GLOBAL CLIMATE POLICYENERGY POLICY AND MARKETREGULATION

TARGETS AND INCENTIVES FORRENEWABLESRENEWABLES FOR HEATING ANDCOOLING

ENERGY EFFICIENCY ANDINNOVATION

“effective policies are essentialto provide the clear, sustainedincentives that create spacefor leadership and stimulateneeded actions throughoutcanadian society.”STATEMENT ON CLIMATE CHANGE SIGNED BY FORMER CANADIAN PRIME MINISTERS CAMPBELL, CHRETIEN, MARTIN AND TURNER.

STANDBY POWER IS WASTED POWER.GLOBALLY, WE HAVE 50 DIRTY POWERPLANTS RUNNING JUST FOR OUR WASTEDSTANDBY POWER. OR: IF WE WOULDREDUCE OUR STANDBY TO JUST 1 WATT, WE CAN AVOID THE BUILDING OF 50 NEWDIRTY POWER PLANTS. © M. DIETRICH/DREAMSTIME

106


If the Energy [R]evolution is to happen, then governments around theworld—including Canada’s—need to play a major part. Theircontribution will include regulating the energy market on the supply anddemand side; educating everyone, from consumers to industrialists; andstimulating the market for renewable energy and energy efficiency, by arange of economic mechanisms. There are a number of successful policiesalready adopted that can serve as models.

As a first step, governments should agree on further, binding emissionsreduction commitments in a second phase of the Kyoto Protocol. Onlyby setting stringent greenhouse gas emissions reduction targets willthe price of carbon become sufficiently high to properly reflect itstrue cost to the environment and society. This will in turn stimulateinvestments in renewable energy. Through funding for emissionsreduction and adaptation, industrialized countries will also promoterenewable energy and energy efficiency in developing countries.

Support is also needed for the introduction of feed-in tariffs in thedeveloping world in order to duplicate the success of countries suchas Germany and Spain, where the growth of renewable energy hasboomed. Energy efficiency measures should be more stronglysupported through the Kyoto process and its financial mechanisms.

Carbon pricing can also play an important role in the success of theEnergy [R]evolution. The price of carbon must be sufficiently high toreflect its real costs to the environment and society. Only then can wecreate a level playing field for efficiency and renewable energy.

Industrialized countries should ensure that all financial flows to energyprojects in developing countries are targeted toward renewable energyand energy efficiency. All financial assistance (including grants, loans ortrade guarantees) for fossil fuel and nuclear power production, should bephased out in the next two to five years. International financialinstitutions, export credit agencies and development agencies shouldprovide the required finance to facilitate the implementation of theEnergy [R]evolution in developing countries.

We encourage all countries to join the Energy [R]evolution byadopting the following policies.

9.1 climate policy

At the most basic level, policies to fight climate change mustdiscourage the use of fossil fuels, and encourage the use of renewableenergy.

Action: Phase out subsidies for fossil fuel and nuclear powerproduction and inefficient energy use

The United Nations Environment Programme (UNEP) estimates theannual bill for worldwide energy subsidies at about US$300 billion,or 0.7% of global GDP.122 Approximately 80% of this is spent onfunding fossil fuels and more than 10% to support nuclear energy.The lion's share is used to artificially lower the real price of fossilfuels. Subsidies (including loan guarantees) make energy efficiencyless attractive, keep renewable energy out of the market place andprop up non-competitive, inefficient technologies.

Eliminating direct and indirect subsidies to fossil fuels and nuclearpower would encourage a level playing field across the energy sector.Scrapping these payments would, according to UNEP, reducegreenhouse gas emissions by as much as 6% a year, whilecontributing 0.1% to global GDP. Moreover, these subsidies rarelyaddress poverty directly, thereby challenging the widely held view thatsome of these subsidies assist the poor.

According to a 2005 report for the Climate Action Network,Canadian oil and gas companies (including the tar sands) benefitedfrom a federal subsidy of $1,085 million in 1996. That amount hadincreased 33 per cent, to $1.4 billion, by 2002. Total expenditure overthe 1996 to 2002 period was $8.3 billion.123

As progress on fossil subsidies, the Harper government points to its2007 Budget commitment to phase out the Accelerated Capital CostAllowance (ACCA) for the tar sands by 2016, starting in 2011, aswell as the phaseout of two other tax subsidies, “earned depletion”and “resource allowance.” However, the overall oil and gas sector tax-rate has actually decreased relative to the 2001–2002 level, and fivemajor tax subsidies, identified in the 2005 Climate Action Networkreport, still remain in place.

The remaining Canadian tax subsidies include124:

• Canadian Exploration Expense,

• Canadian Development Expense,

• Canadian Oil and Gas Property Expense,

• Atlantic Investment Tax Credit, and

• Scientific Research and Experimental Development Tax Credit.

According to the Pembina Institute, that level of subsidy rose to alevel of about $2 billion per year in 2010.

The Harper government is also providing direct subsidies to the fossilfuel industry, in the form of support for carbon capture and storage(CCS) projects. In its March 2010 budget, the Harper governmentannounced “over $800 million” in subsidies for carbon capture andstorage projects, under two programs, the Clean Energy Fund , andthe ecoEnergy Technology Initiative.125

Subsidies have already been provided under the Clean Energy Fundfor three large-scale carbon capture and storage projects:

• $120 million for the Shell Quest CCS project,

• $315.8 million for the TransAlta Keephills CCS project for a coal-firedpower plant near Edmonton, and

• $30 million for the Alberta Carbon Trunk Line project.

references122 UNITED NATIONS ENVIRONMENT PROGRAMME, REFORMING ENERGY SUBSIDIES:OPPORTUNITIES TO CONTRIBUTE TO THE CLIMATE CHANGE AGENDA, AUGUST 2008.123 AMY TAYLOR, ET AL., GOVERNMENT SPENDING ON CANADA'S OIL AND GAS INDUSTRY:UNDERMINING CANADA'S KYOTO COMMITMENT, PEMBINA INSTITUTE, FOR THE CLIMATEACTION NETWORK, 31 JANUARY 2005, AVAILABLE AT<HTTP://WWW.GREENECONOMICS.CA/PUB/181>. 124 IBID125 GOVERNMENT OF CANADA, BUDGET 2010: LEADING THE WAY ON JOBS AND GROWTH:TABLED IN THE HOUSE OF COMMONS BY THE HONOURABLE JAMES M. FLAHERTY, P.C.,M.P. MINISTER OF FINANCE, 4 MARCH 2010. FOR REFERENCES TO CARBON CAPTURE ANDSTORAGE, SEE PAGES 103 & 245.

9

climate &

energ

y policy

|CLIM

ATE P

OLIC

Y

Greenpeace has condemned CCS as a risky and highly expensivetechnological “false solution” that will divert much-needed fundingfrom more-reliable and more-cost-effective alternatives such asrenewable energy and efficiency.126

Nuclear subsidies in Canada have also been an ongoing issue. Directparliamentary subsidies to the wholly owned federal crown corporationAtomic Energy of Canada Limited (AECL) have totalled over $20.9billion since AECL was founded in 1952.127 There are a number of otherhidden subsidies that are difficult to calculate.128 These include protectionfrom liability for nuclear accidents under the Nuclear Liability Act thatlimits liability for nuclear operators to $75 million at each plant.

In another massive subsidy to Canada’s nuclear industry, in 1998 theOntario government relieved the successor companies of OntarioHydro of about $20 billion in “stranded” nuclear debt, when theformer utility was restructured. All ratepayers in Ontario continue topay a charge for this nuclear debt on every electricity bill.129

A large and uncertain liability hangs over the nuclear industry in theform of expenses for waste management and decommissioning thatmay exceed the legally stipulated amounts. In Canada, the NuclearWaste Management Organization has been mandated to deal withmanagement of radioactive waste.

In 2009, the government of Ontario decided to close, rather than refurbish,the Pickering B nuclear reactors. It has also indefinitely delayed a decisionon whether to purchase a new set of nuclear reactors. This delay was inresponse to “sticker shock,” as the bidding process resulted in a reportedprice tag of $26 billion for two 1,200 MW reactors—more than threetimes the expected cost. While not an explicit rejection of subsidies fornuclear power, these decisions, when coupled with the introduction of afeed-in tariff system for renewable energy (highlighted below), are apromising sign. The government is, however, still considering therefurbishment of the Darlington nuclear station.

The G-20 countries, meeting in Philadelphia in September 2009, called forworld leaders to eliminate fossil fuel subsidies, but hardly any progress hasbeen made since then towards implementing the resolution.

In Canada, there is solid support for eliminating fossil fuel subsidieswithin the federal bureaucracy and some support in the federal Cabinet,although virtually no action has been taken. In a leaked governmentbriefing note prepared for federal Finance Minister Jim Flaherty inadvance of the 2010 G20 summit in Toronto, the Deputy Minister ofFinance recommended that the government “Take opportunity toselectively rationalize fossil fuel measures (e.g. tax preferences forproducers).” This recommendation was made on the grounds thatproducer subsidies are no longer necessary, removing them is consistentwith making the tax system more sector-neutral, and eliminating subsidieswould help balance government budgets. The memo also noted thatremoving fossil fuel subsidies “could also help respond to his[Environment Minister Jim Prentice’s] concern about maintainingCanada’s reputation as a ‘clean energy superpower’, and help defendagainst U.S. government or individual company actions targeted, forexample, against oil sands.”130 To date, however, the Prime Minister’sresponse has been consistent with the second (not-recommended) optionin the memo: minimize the commitment as a way of avoiding it.131

107

© GP/PETER CATON

image A WOMAN IN FRONT OF HER FLOODED HOUSE INSATJELLIA ISLAND. DUE TO THE REMOTENESS OF THESUNDARBANS ISLANDS, SOLAR PANELS ARE USED BYMANY VILLAGERS. AS A HIGH TIDE INVADES THE ISLAND,PEOPLE REMAIN ISOLATED SURROUNDED BY THE FLOODS.

Action: Introduce the “polluter pays” principle

A substantial indirect form of subsidy comes from the fact that theenergy market does not incorporate the external, societal costs of theuse of fossil fuels and nuclear power. Pricing structures in the energymarkets should reflect the full environmental and social costs ofenergy production.

This requires that governments apply a “polluter pays” system thatcharges the emitters accordingly or applies suitable compensation tonon-emitters. Adoption of polluter-pays taxation to electricity sources,or equivalent compensation to renewable energy sources, and exclusionof renewables from environment-related energy taxation is essential toachieve fairer competition in the world’s electricity markets.

The real cost of conventional energy production includes expensesabsorbed by society, such as health impacts and environmentaldegradation—from mercury pollution to acid rain—as well as the globalnegative impacts of climate change. Hidden costs include the waiving ofnuclear accident insurance that is too expensive to be covered by thenuclear power plant operators. The Price Anderson Act, in the UnitedStates, limits liability 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 therest being drawn from an industry fund of up to $10 billion. After thatthe taxpayer becomes responsible. As noted above, Canada’s NuclearLiability Act caps liability at $75 million per plant.

Although environmental damage should, in theory, be rectified byforcing polluters to pay, the environmental impacts can be difficult toquantify. How do you put a price on lost homes on Pacific Islands as aresult of melting icecaps or on deteriorating health and human lives?

An ambitious project, ExternE, funded by the European Commission,has tried to quantify the full environmental costs of electricitygeneration. It estimates that full cost accounting would double the costof producing electricity from coal or oil, and would increase the cost ofgas-fired electricity by 30%. If those environmental costs were leviedon electricity generation, many renewable energy sources would notneed any financial support. If, at the same time, direct and indirectsubsidies to fossil fuels and nuclear power were removed, there wouldbe little or no need to support renewable electricity generation.

9

climate &

energ

y policy

|CLIM

ATE P

OLIC

Y

references126 GREENPEACE INTERNATIONAL, FALSE HOPE: WHY CARBON CAPTURE AND STORAGEWON’T SAVE THE CLIMATE, 5 MAY 2008.127 THIS FIGURE CONVERTS ANNUAL SUBSIDIES IN DOLLARS OF THE YEAR INTO 2005DOLLARS. SEE: TOM ADAMS, FEDERAL GOVERNMENT SUBSIDIES TO ATOMIC ENERGY OFCANADA LIMITED, ENERGY PROBE, 11 JANUARY, 2006.128 GREENPEACE CANADA HAS MONETIZED THIS HIDDEN NUCLEAR LIABILITY SUBSIDYTO NUCLEAR OPERATORS IN THE RANGE OF 5.4 TO 11.0 CENTS/KWH. SEE: GORDONTHOMSON, THE NUCLEAR LIABILITY AND COMPENSATION ACT: IS IT APPROPRIATE FORTHE 21ST CENTURY?, GREENPEACE CANADA, 12 NOVEMBER 2009. 129 ONTARIO MINISTRY OF FINANCE, FACT SHEET: PRELIMINARY ESTIMATES, 26OCTOBER 1998. SEE ALSO: FINANCIAL RESTRUCTURING & PRELIMINARY STRANDEDDEBT, 26 OCTOBER 1998.130 MINISTRY OF FINANCE, “G-20 COMMITMENT—FOSSIL FUEL SUBSIDIES,”MEMORANDUM FROM MICHAEL HORGAN TO MINISTER OF FINANCE, 18 MARCH, 2010,AVAILABLE AT<HTTP://COMMUNITIES.CANADA.COM/SHAREIT/BLOGS/POLITICS/ARCHIVE/2010/05/28/PRENTICE-AND-FLAHERTY-BEHIND-CLOSED-DOORS-WITH-PM.ASPX>. 131 MIKE DE SOUZA, “HARPER SIDESTEPS QUESTIONS ABOUT ELIMINATING SUBSIDIESTO FOSSIL FUEL INDUSTRY”, CANWEST NEWS SERVICE, 26 MAY 2010.

108


One way to achieve this is by a carbon tax that ensures a fixed priceis paid for each unit of carbon that is released into the atmosphere.Such taxes have been applied in Sweden and Norway. Anotherapproach is through emissions trading (cap and trade), as operatingin the European Union and planned in New Zealand. This conceptgives pollution reduction a value in the marketplace.

In theory, cap and trade prompts technological innovation that reducespollution down to the required levels. Stringent cap and trade canharness market forces to achieve cost-effective greenhouse gas emissionreductions. But this will only happen if governments implement true“polluter pays” cap-and-trade schemes, with carbon prices that reflectthe full cost of fossil fuel pollution.

Government programmes that allocate a maximum amount ofemissions to industrial plants have proved to be effective in promotingenergy efficiency in certain industrial sectors. To be successful,however, these allowances need to be strictly limited and theirallocation auctioned.

Within Canada, the government of Quebec introduced a modestcarbon tax in 2007 that is intended to raise $200 million per year fora Green Fund that is primarily used for financing public transit. Thegovernment of British Columbia introduced a carbon tax in July 2008that covers a broad range of fossil fuels and is set at a level of $10per tonne, rising by $5 per tonne per year over four years to $30 pertonne in 2012. It is designed to be revenue-neutral throughreductions of other taxes, and protects low-income householdsthrough “climate action credit” of $100 per adult and $30 per child,paid quarterly.132

While both are relatively modest carbon prices, relative to whatwould be required to achieve major reductions, their significance isprimarily political. The Quebec tax has not been controversial, but theBritish Columbia carbon tax became a central issue in the 2009election campaign. The British Columbia Liberal Party, which hadintroduced the tax, was able to win a third term and demonstrate thata carbon tax does not guarantee electoral defeat.

A recent analysis found that, even with strong complementary regulationsand public investments, achieving the Canadian government’s pre-Copenhagen target (3% below 1990 levels by 2020) would require acarbon price starting at $40 per tonne in 2011, rising to $67 per tonneby 2015, and to $100 per tonne by 2020.133

9.2 energy policy and market regulation

Essential reforms are necessary in the electricity sector if newrenewable energy technologies are to be implemented more widely.

Action: Reform the electricity market to integrate renewableenergy technologies

Complex licensing procedures and bureaucratic hurdles constitute oneof the most difficult obstacles faced by renewable energy in manycountries. A clear timetable for approving renewable energy projectsshould be set for all administrations at all levels, and they should

receive priority treatment. Governments should propose more-detailedprocedural guidelines, to strengthen the existing legislation and at thesame time streamline the licensing procedures.

Other barriers include the lack of long-term and integrated resourceplanning at national, regional and local levels; the lack of predictabilityand stability in the markets; grid ownership by vertically integratedcompanies; and the absence of (access to) grids for large-scalerenewable energy sources, such as offshore wind power or concentratingsolar power plants. The International Energy Agency has identifiedDenmark, Spain and Germany as examples of countries exhibiting bestpractice in a reformed electricity market that supports the integrationof renewable energy.

In order to remove these market barriers, governments should:

• streamline planning procedures and permit systems, and integrateleast-cost network planning;

• ensure access to the grid at fair and transparent prices;

• ensure priority access and transmission security for electricitygenerated from renewable energy resources, including financialrecognition for the benefits of embedded generation;

• unbundle all utilities into separate generation, distribution andselling companies;

• ensure that the costs of grid infrastructure development andreinforcement are borne by the grid management authority ratherthan individual renewable energy projects;

• ensure the disclosure of fuel mix and environmental impact to end users;

• establish progressive electricity and final energy tariffs so that theprice of a kWh costs more for those who consume more;

• set up demand management programmes designed to limit energydemand, reduce peak loads and maximize the capacity factor of thegeneration system. Demand-side management should also beadapted to facilitate the maximum possible share of renewableenergies in the power mix; and

• introduce pricing structures in the energy markets to reflect the fullcosts to society of producing energy.

In Canada, Ontario has gone the farthest in this area, following theenactment of a landmark piece of legislation, the May 2009 GreenEnergy Act, which put in place both a system of feed-in tariffs andimproved grid access for renewables.

9.3 targets and incentives for renewables

At a time when governments around the world are in the process ofliberalizing their electricity markets, the increasing competitiveness ofrenewable energy should lead to higher demand. Without politicalsupport, however, renewable energy remains at a disadvantage—

9

climate &

energ

y policy

|ENERGY P

OLIC

Y A

ND M

ARKET R

EGULATIO

N

references132 GOVERNMENT OF BRITISH COLUMBIA, “B.C.’S REVENUE-NEUTRAL CARBON TAX”,BACKGROUNDER, 1 JULY 2008. 133 MATTHEW BRAMLEY, PIERRE SADIK AND DALE MARSHALL, CLIMATE LEADERSHIP,ECONOMIC PROSPERITY: FINAL REPORT ON AN ECONOMIC STUDY OF GREENHOUSE GASTARGETS AND POLICIES FOR CANADA, PEMBINA INSTITUTE AND DAVID SUZUKIFOUNDATION, 2009.

109

marginalized by distortions in the world’s electricity markets createdby decades of massive financial, political and structural support toconventional technologies. Developing renewables will thereforerequire strong political and economic efforts, especially through lawswhich guarantee stable tariffs over a period of up to 20 years.

At present, new renewable energy generators have to compete with oldnuclear and fossil-fuelled power stations which produce electricity atminimal costs because ratepayers and taxpayers have already paid theinterest and depreciation on the original investments. In many countries(including Canada and the United States), utilities have been relieved ofdebt for nuclear and fossil fuel plants as part of restructuring processes.Political action is needed to overcome these distortions and create alevel playing field.

Support mechanisms for different sectors and technologies can varyaccording to regional characteristics, priorities or starting points, butsome general principles should apply:

• Long-term stability: Policy makers need to make sure thatinvestors can rely on the long-term stability of any support scheme.It is absolutely crucial to avoid stop-and-go markets that resultfrom changing the system or the level of support frequently.

• Local and regional benefits for public acceptance: In order toencourage public acceptance of renewables, support schemes shouldencourage local/regional development, employment and incomegeneration, and increased stakeholder involvement.

Incentives can be provided for renewable energy through both targetsand price support mechanisms.

Action: Establish legally binding targets for renewable energyand combined heat and power generation

An increasing number of countries have established targets forrenewable energy, either as a general target or as broken down by sectorfor power, transport and heating. These are either expressed in terms ofinstalled capacity or as a percentage of energy consumption. Forexample, China and the European Union have targets of 20% renewableenergy by 2020, and New Zealand has a target of 90% by 2025.

Although these targets are not always legally binding, they have servedas an important catalyst for increasing the share of renewable energythroughout the world. The electricity sector clearly needs a long-termhorizon, as investments are often only paid back after 20 to 40 years.Renewable energy targets therefore need to have short-, medium- andlong-term stages and must be legally binding in order to be effective. Inorder for the proportion of renewable energy to increase significantly,targets must also be set in accordance with the potential for eachtechnology (wind, solar, biomass, etc.) and by taking into accountexisting and planned infrastructure. Detailed analysis is needed todefine the pathway and timeline to a 100%-renewable energy system.

Action: Provide a stable return for investors through pricesupport mechanisms

Price support mechanisms for renewable energy are a practical means

© GP/WILL ROSE

image A YOUNG INDIGENOUS NENET BOY PRACTICES WITH HIS ROPE. THE BOYS ARE GIVEN A ROPEFROM PRETTY MUCH THE MOMENT THEY ARE BORN. BY THE AGE OF SIX THEY ARE OUT HELPINGLASSOING THE REINDEER. THE INDIGENOUS NENETS PEOPLE MOVE EVERY 3 OR 4 DAYS SO THATTHEIR REINDEER DO NOT OVER GRAZE THE GROUND AND THEY DO NOT OVER FISH THE LAKES. THEYAMAL PENINSULA IS UNDER HEAVY THREAT FROM GLOBAL WARMING AS TEMPERATURES INCREASEAND RUSSIAS ANCIENT PERMAFROST MELTS.

of correcting market failures in the electricity sector. Their aim is tosupport market penetration of those renewable energy technologies, suchas wind and solar thermal, that currently suffer from unfair competitiondue to direct and indirect support for fossil fuels and nuclear energy.They will also provide incentives for technology improvements and costreductions so that technologies such as PV, wave and tidal can competewith conventional sources in the future.

Overall, there are two types of incentive to promote the deployment ofrenewable energy. These are fixed price systems, where the governmentdictates the electricity price (or premium) paid to the producer and letsthe market determine the quantity, and renewable quota systems(known as renewable portfolio standards in the United States), wherethe government dictates the quantity of renewable electricity and leavesit to the market to determine the price.

Both systems create a protected market against a background ofsubsidized, depreciated conventional generators whose externalenvironmental costs are not accounted for. Their aim is to provide incentivesfor technology improvements and cost reductions, leading to cheaperrenewables that can compete with conventional sources in the future.

The main difference between quota-based and price-based systems isthat the former aims to introduce competition between electricityproducers. However, competition between technology manufacturers,which is the most crucial factor in bringing down electricity productioncosts, is present regardless of whether government dictates prices orquantities. Prices paid to wind power producers are currently higher inmany European quota-based systems (UK, Belgium, Italy) than in fixedprice or premium systems (Germany, Spain, Denmark).

The European Commission has concluded that fixed-price systems areto be preferred above quota systems. If implemented well, fixed pricesystems are a reliable, bankable support scheme for renewable energyprojects, providing long-term stability and leading to lower costs. Inorder for such systems to achieve the best possible results, however,priority access to the grid must be ensured.

9.3.1 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 thebasis of the rated power (in kW) of the generator. It is generallyacknowledged, however, that systems which base the amount ofsupport on generator size rather than electricity output can lead toless efficient-technology development. There is therefore a globaltrend away from these payments, although they can be effectivewhen combined with other incentives.

• Fixed feed-in tariffs (FITs) widely adopted in Europe, have provenextremely successful in expanding wind energy in Germany, Spain andDenmark. Operators are paid a fixed price for every kWh of electricitythey feed into the grid. In Germany the price paid varies according tothe relative maturity of the particular technology and diminishes eachyear to reflect falling costs. The additional cost of the system is borneby taxpayers or electricity consumers.

9

climate &

energ

y policy

|TARGETS A

ND IN

CENTIV

ES F

OR R

ENEW

ABLES

110


The main benefit of an FIT is that it is administratively simple andencourages better planning. Although the FIT is not associated witha formal power purchase agreement (PPA), distribution companiesare usually obliged to purchase all the production from renewableinstallations. Germany has reduced the political risk of the system’sbeing changed, by guaranteeing payments for 20 years. The mainproblem associated with a fixed price system is that it does not lenditself easily to adjustment, whether up or down, to reflect changesin the production costs of renewable technologies.

• Fixed premium systems sometimes called “environmental bonus”mechanisms, operate by adding a fixed premium to the basicwholesale electricity price. From an investor perspective, the totalprice received per kWh is less predictable than under a feed-in tariffbecause it depends on a constantly changing electricity price. From amarket perspective, however, it is argued that a fixed premium iseasier to integrate into the overall electricity market because thoseinvolved will be reacting to market price signals. Spain is the mostprominent country to have adopted a fixed-premium system.

• Tax credits offer a credit against tax payments for every kWhproduced. In the United States the market has been driven by afederal Production Tax Credit (PTC) of approximately USD 1.8cents per kWh. It is adjusted annually for inflation. In Canada, thefederal government recently ended its support for the 1 cent/kWh ecoEnergy Programme for Renewable Energy.134

The bright spot in Canada has been Ontario, which established afeed-in tariff system as part of the May 2009 Green Energy Act.This has resulted in over $18 billion worth of new investment inrenewable energy being announced within the first six months of2010. By 2015, this will result in more than 800 projectsgenerating over 7,750 MW of new renewable energy being on-linein the province.135 These projects will be capable of producing over16 TWh of electricity annually (or roughly 11% of currentelectricity consumption in Ontario).

Another 157 projects have been approved, pending improvements to thetransmission system that would enable them to connect to the grid.

9.3.2 renewables quota systems

Two types of renewable quota systems have been employed: tenderingsystems, and green certificate systems.

• Tendering systems involve competitive bidding for contracts toconstruct and operate a particular project, or a fixed quantity of

renewable capacity in a country or state. Although other factorsare usually taken into account, the lowest-priced bid invariablywins. This system has been used to promote wind power in Ireland,France, the UK, Denmark and China. In Canada, Quebec haslaunched a bidding process for 4,000 MW of wind power to be inplace by 2015.136

The downside is that investors can bid an uneconomically low pricein order to win the contract, and then not build the project. Underthe UK’s NFFO (Non–Fossil Fuel Obligation) tender system, forexample, many contracts remained unused. It was eventuallyabandoned. If properly designed, however, with long contracts, aclear link to planning consent and a possible minimum price,tendering for large-scale projects could be effective, as it has beenfor 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 renewableproducer. The value of these certificates, which can be traded on amarket, is then added to the value of the basic electricity. A greencertificate system usually operates in combination with a risingquota of renewable electricity generation. Power companies arebound by law to purchase an increasing proportion of renewablesinput. Countries which have adopted this system include the UKand Italy in Europe and many individual states in the UnitedStates, where it is known as a Renewable Portfolio Standard.

Compared with a system using a fixed tender price, the TGC model ismore risky for the investor (because the price fluctuates on a dailybasis) unless effective markets for long-term certificate (and electricity)contracts are developed. Such markets do not currently exist. The systemis also more complex than other payment mechanisms.

9.4 renewables for heating and cooling

The crucial requirement for both heating and cooling is oftenforgotten in the energy mix. In many regions of the world, such asEurope, nearly half of the total energy demand is for heating/cooling.This demand can be met economically without relying on fossil fuels.

Action: Establish targets and incentives for renewable heatingand cooling.

Policies should make sure that specific targets and appropriatemeasures to support renewable heating and cooling are part of anynational renewables strategy. These should include financialincentives, awareness-raising campaigns, training of installers,architects and heating engineers, and demonstration projects. For newbuildings, and those undergoing major renovation, an obligation tocover a minimum share of heat consumption by renewables should beintroduced, as already implemented in some countries. At the same

9

climate &

energ

y policy

|RENEW

ABLE H

EATIN

G A

ND C

OOLIN

G

references134 GLORIA GALLOWAY, “TORY BUDGET ‘WALKS AWAY' FROM RENEWABLE ENERGY,ENVIRONMENTALIST SAYS” GLOBE AND MAIL, 10 MARCH 2010.135 GREENPEACE CANADA, ONTARIO’S GREEN ENERGY PLAN 2.0: CHOOSING 21ST ENERGYOPTIONS, AUGUST 2010; AND ONTARIO POWER GENERATION, “FIRST MAJOR NORTHERNHYDROELECTRIC PROJECT IN 40 YEARS BOOSTS NORTHERN ECONOMY,” PRESS RELEASE, 7JUNE 2010.136 HYDRO-QUEBEC, AND MINISTRY OF NATURAL RESOURCES AND WILDLIFE, “WINDENERGY,” ONLINE AT <HTTP://WWW.MRNF.GOUV.QC.CA/ENGLISH/ENERGY/WIND/INDEX.JSP>.

table 9.1: new renewables built or contracted, in ontario, as of june 2010

CAPACITY

1,255 MW

4,692 MW

1,178 MW

633 MW

7,758 MW

RENEWABLE

Solar

Wind

Biomass

Hydro

Total

111

time, increased R&D efforts should be undertaken, particularly in thefields of heat storage and renewable cooling.

Governments should also promote the development of combined heatand power generation in those industrial sectors that are most attractivefor CHP: where there is a demand for heat either directly or through alocal (existing or potential) district heating system. Governments shouldset targets and efficiency standards for CHP and provide financialincentives for investment in industrial installations.

5. energy efficiency and innovation

Canada’s primary energy and electricity consumption per unit of GDP isthe highest among IEA countries. Final energy consumption has growncontinuously over the past decade, though at a slower rate than theeconomy as a whole.137

Action: Set stringent efficiency and emissions standards forappliances, buildings, power plants and vehicles

Effective government policies to promote energy efficiency usuallycontain two elements: those measures that push the market throughstandards, and those that pull through incentives. Enactedconcurrently, these have proven to comprise an effective, low-cost wayto coordinate a transition to greater energy efficiency.

Canada’s national Energy Efficiency Act sets minimum standards forthe energy performance of a range of domestic and commercialappliances and equipment which account for close to a quarter of thiscountry’s energy use. But the Act is largely focused on eliminating theleast energy-efficient equipment from the market rather than onincreasing the availability of the best technologies and most efficientmodels. The current approach of bringing up the rear with newstandards only when efficient products finally capture a significant(60%) market share means we are wasting a great opportunity tocut emissions and curb climate change.

Japan’s front-running programme, on the other hand, is a regulatoryscheme with mandatory targets which gives incentives to manufacturersand importers of energy-consuming equipment to continuously improvethe efficiency of their products. It operates by allowing today's bestmodels on the market to set the level for future standards.

The federal government should change its approach and proactively usethe Energy Efficiency Act to lead Canadians toward greater efficiency.Bringing up the rear is an inadequate strategy. One way to do this wouldbe to make EnergyStar® or other premium efficiency benchmarks theminimum energy performance standard, as Ontario has promised to dounder the Green Energy Act. This will help drive the innovation, researchand marketing needed to make all Canadians energy winners. Thisapproach is low-cost and involves little bureaucratic red tape—just thepolitical will to get serious about reducing climate change emissions andto make changes to existing regulations.

Federal and provincial governments should also develop and supporteducation, marketing and incentive programmes designed to deliverthe greatest possible returns. These programmes could include, forexample, replacement of old refrigerators or other inefficient

equipment, and helping consumers overcome barriers such as longpay-back periods or higher up-front costs.

Action: Support innovation in energy efficiency, low-carbontransportation and renewable energy production

Innovation will play an important role in the Energy [R]evolution, and isneeded to achieve ever-improving efficiency and emissions standards.Programmes supporting development and diffusion for efficiency andrenewable energy are a traditional focus of energy and environmentalpolicies. Energy innovations face barriers all along the energy supplychain—from research and development (R&D) to demonstrationprojects and widespread deployment. Direct government support througha variety of fiscal instruments, such as tax incentives, is vital tohastening deployment of radically new technologies, due to a lack ofindustry investment. Thus, there is a role for the public sector inincreasing investment directly and in correcting market and regulatoryobstacles that inhibit investment in new technology

Governments need to invest in research and development of more-efficient appliances and building techniques, of new forms of insulation,of new types of renewable energy production (such as tidal and wavepower), as well as of a low-carbon transportation future (for example,through the development of better batteries for plug-in electric cars orof fuels for aviation from renewable sources). Governments need toengage in innovation themselves, both through publicly funded researchand by supporting private research and development.

There are numerous ways to support innovation. The most importantpolicies are those that reduce the cost of research and development,such as through tax incentives, staff subsidies or project grants.Financial support for R&D on dead-end technologies such as nuclearfusion should be diverted to supporting renewable energy, energyefficiency and decentralized energy solutions.

In Canada, this will mean a substantial change in the allocation ofpublic R&D funding. Of the estimated $708 million spent by Canadiangovernments on energy research and development, nuclear powerreceived the lion’s share (38%), followed by fossil fuels (27%).Energy efficiency received only 14% of funding, while renewableenergy was limited to 11%. Overall spending has increased over thelast four years, but the relative shares has been fairly constant overthe last 18 years.138

Specific proposals for efficiency and innovation measures follow.

9.5.1 appliances and lighting

• Efficiency standards Governments should set ambitious, stringent andmandatory efficiency standards for all energy-consuming appliances, thatconstantly respond to technical innovation and enforce the phase-out ofthe most inefficient appliances. These standards should allow the banningof inefficient products from the market, as has been done withincandescent light bulbs, and include penalties for non-compliance.

references137 INTERNATIONAL ENERGY AGENCY, ENERGY POLICIES OF IEA COUNTRIES: CANADA2009 REVIEW, 2010, P. 79.138 INTERNATIONAL ENERGY AGENCY (IEA), ENERGY POLICIES OF IEA COUNTRIES:CANADA 2009 REVIEW, (2010), PP. 237–238.

© GP/HU WEI

© N. BEHRING-CHISHOLM/GPimage A WORKER ENTERS A TURBINE TOWER FOR MAINTENANCE AT DABANCHENG

WIND FARM. CHINA’S BEST WIND RESOURCES ARE MADE POSSIBLE BY THE NATURALBREACH IN TIANSHAN (TIAN MOUNTAIN).

image WOMEN WEAR MASKS AS THEY RIDE BIKES TO WORK IN THE POLLUTED TOWNOF LINFEN. LINFEN, A CITY OF ABOUT 4.3 MILLION, IS ONE OF THE MOST POLLUTEDCITIES IN THE WORLD. CHINA’S INCREASINGLY POLLUTED ENVIRONMENT IS LARGELYA RESULT OF THE COUNTRY’S RAPID DEVELOPMENT AND CONSEQUENTLY A LARGEINCREASE IN PRIMARY ENERGY CONSUMPTION, WHICH IS ALMOST ENTIRELYPRODUCED BY BURNING COAL.

9

climate &

energ

y policy

|ENERGY E

FFIC

IENCY A

ND IN

NOVATIO

N

112


• Consumer awareness Governments should inform consumers(and/or set up systems that compel retailers and manufacturers todo so), about the energy efficiency of the products they use and buy.Consumers often make their choices based on non-financial factorsbut lack the necessary information.

• Energy labelling Labels provide the means to inform consumers ofthe product's relative or absolute performance and its energyoperating costs. Governments should support the development ofendorsement and comparison labels for electrical appliances. TheEnergyStar labelling system in Canada provides a good base tobuild on, and should be expanded.

9.5.2 buildings

• Residential and commercial building codes Energy efficiency inbuildings is hampered by significant market barriers. The modelnational building code should be updated and serve as a minimumstandard for provincial governments, with new houses starting at50% higher efficiency than current norms, and new commercialbuildings built to LEED Gold specifications.

Building codes should also be updated to require the use of a set shareof renewable energy for heating and cooling. These codes should beregularly upgraded in order to make use of new technologies on themarket, and non-compliance should be penalized.

• National Retrofit Program Given the long lifespan of buildings, it isimportant to have a national strategy for retrofitting existingbuildings. Canada has good examples such as Toronto’s Better BuildingProgram, but these need to be scaled up and extended to theresidential sector. Canada should follow the example of the UK, whose‘Warm Homes, Greener Homes’ retrofit strategy is aimed at cuttingemissions from the UK’s homes by 29% by 2020. It has an interimcommitment to ensure that every household will have installed loftand cavity wall insulation where it is practical to do so by 2015, and alonger-term goal of providing every home in Britain with the benefit ofmeasures to improve energy efficiency by 2030. The strategy places aparticular focus on vulnerable households who often stand to benefitthe most from improvements in energy efficiency.139

• Financial incentives Given that investment costs are often a barrierto implementing energy efficiency measures, in particular forretrofitting renewable energy options, governments should offerfinancial incentives, including tax reductions schemes, investmentsubsidies and preferential loans. Unfortunately, the Government ofCanada recently ended its support for the ecoEnergy HomesProgramme, which supported these types of retrofits.140

• Energy intermediaries and audit programmes Canadiangovernments should develop strategies and programmes for theeducation of architects, engineers and other professionals in thebuilding sector, as well as end-users, about energy efficiencyopportunities in new and existing buildings. As part of this strategy,governments should invest in “energy intermediaries” and energy auditprogrammes, in order to assist professionals and consumers inidentifying opportunities for improving the efficiency of their buildings.

9.5.3 transport

• Emissions standards One of the most effective ways to save

energy is for governments to regulate the efficiency of private carsand other transport vehicles, in order to push manufacturers toreduce emissions through downsizing, and design and technologyimprovement. Improvements in efficiency will reduce CO2 emissionsirrespective of the fuel used.

In April 2009, the Canadian federal government issued a notice of intentto regulate vehicle emissions, starting with the 2011 model year.141 Thefederal government has also announced that it is working with the UnitedStates toward the development and implementation of common NorthAmerican standards. This is a welcome development, particularly as theObama administration is adopting the more rigorous California standard,but Canada needs to ensure continuous improvement.

Emissions standards should provide for an average reduction of 5 gCO2/km/year in industrialized countries. These standards need to bemandatory. To dissuade car makers from overpowering high-end cars, aCO2 emissions limit for individual car models should be introduced.

• Electric vehicles After maximizing efficiency gains, furtherreductions can be achieved by using low-emission fuels. Governmentsshould create incentives to promote the further development ofelectric cars and other efficient and sustainable low-carbon transporttechnologies, such as electrically-powered light-rail transit. Linkingelectric vehicles to a renewable energy grid is the best possible optionto reduce emissions from the transport sector.

There are initiatives in this respect at the provincial level. TheGovernment of Ontario has set a target of having 5% of the provincialvehicle fleet fuelled primarily by electricity by 2020 and is introducinga system of electric vehicle subsidies.142 Hydro-Québec is aggressivelypursuing the electrification of transportation on behalf of theGovernment of Quebec, including partnerships with vehiclemanufacturers.143 British Columbia is reviewing infrastructurerequirements and initiating pilot projects.144 But Canada still needs anational strategy on electric vehicles.

• Transport demand management Governments should invest indeveloping, improving and promoting low-carbon transport options,such as public and non-motorized transport, freight transportmanagement programmes, “teleworking,” and more efficient land useplanning in order to limit urban sprawl and hence distances travelled.

Investments in public transit infrastructure, coupled with transit-supportive planning rules, will be vital to reducing energy use in thetransport sector. The expansion of urban transit, mostly light rail, acrossCanada plus new high-speed intercity train systems for Quebec City toWindsor, Edmonton to Calgary, and Vancouver to Seattle will require atotal investment of $77 billion between 2010 and 2020.

references139 UK DEPARTMENT OF ENERGY AND CLIMATE CHANGE, WARM HOMES, GREENERHOMES: A STRATEGY FOR HOUSEHOLD ENERGY MANAGEMENT, 2010.140 SEE 31 MARCH 2010 ANNOUNCEMENT BY GOVERNMENT OF CANADA, “ECOENERGYRETROFIT—HOMES PROGRAMME: IMPORTANT ANNOUNCEMENT,” AVAILABLE AT<HTTP://OEE.NRCAN.GC.CA/RESIDENTIAL/PERSONAL/GRANTS.CFM?ATTR=4>. 141 ENVIRONMENT CANADA, “GOVERNMENT OF CANADA TO REDUCE GREENHOUSE GASEMISSIONS FROM VEHICLES,” PRESS RELEASE, 1 APRIL 2009. 142 GOVERNMENT OF ONTARIO, “ONTARIO PAVES THE WAY FOR ELECTRIC VEHICLES”,PRESS RELEASE JUNE 18, 2010.143 HYDRO QUEBEC, TRANSPORTATION ELECTRIFICATION,HTTP://WWW.HYDROQUEBEC.COM/TRANSPORTATION-ELECTRIFICATION/. 144 BC HYDRO, PLUG-IN VEHICLES, HTTP://WWW.BCHYDRO.COM/ABOUT/OUR_COMMITMENT/SUSTAINABILITY/PLUGIN_VEHICLES.HTML. 145 MATTHEW BRAMLEY, PIERRE SADIK AND DALE MARSHALL, CLIMATE LEADERSHIP,ECONOMIC PROSPERITY: FINAL REPORT ON AN ECONOMIC STUDY OF GREENHOUSE GASTARGETS AND POLICIES FOR CANADA, (PEMBINA INSTITUTE AND DAVID SUZUKIFOUNDATION, 2009).

109

climate &

energ

y policy

|ENERGY E

FFIC

IENCY A

ND IN

NOVATIO

N

10glossary & appendix

GLOBAL

“because we use suchinefficient lighting, 80 coal fired power plants are running day and night to produce the energy that is wasted.”GREENPEACE INTERNATIONALCLIMATE CAMPAIGN

image

COAL FIRED POWER PLANT.

© F. FUXA/DREAMSTIME

114


glossary of commonly used terms and abbreviations

bbl barrelCHP combined heat and power CO2 carbon dioxide, the main greenhouse gasCSP concentrating solar powerDE decentralized energyGDP gross domestic product (means of assessing a country’s wealth)GDR Greenhouse Development Rights FrameworkPPP purchasing power parity (adjustment to GDP assessment

to reflect comparable standard of living)RCI responsibility and capacity indicatorGTCO2 gigatonnes of carbon dioxide IEA International Energy AgencyMTCO2 megatonnes of carbon dioxideNEEDS New Energy Externalities Developments for SustainabilityOECD Organisation for Economic Co-operation and DevelopmentPV photovoltaicTWh terawatt-hourWEO World Energy Outllook, IEA report

J joule, a measure of energy: kJ = 1,000 Joules, MJ = 1 million Joules, GJ = 1 billion Joules, PJ = 1015 Joules, EJ = 1018 Joules

W watt, measure of electrical capacity: kW = 1,000 watts, MW = 1 million watts, GW = 1 billion watts

kWh kilowatt-hour, measure of electrical output: TWh = 1012 watt-hours

t/Gt tonnes, measure of weight: Gt = 1 billion tonnes

definition of sectors

The definitions of different sectors are analogous to the sectorialbreak 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 thefollowing subsectors (energy used for transport by industry is notincluded -> 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 transportsuch as road , railway, aviation, domestic navigation. Fuel used for ocean,costal and inland fishing is included in “Other Sectors”.

Other sectors: Other sectors cover agriculture, forestry, fishing,residential, commercial and public services

Non-energy use: Covers use of other petroleum products such asparaffin waxes, lubricants, bitumen etc.

10

climate &

energ

y policy

|GLOSSARY

115

© GP/PETER CATON

image MINOTI SINGH AND HER SON AWAIT FOR CLEANWATER SUPPLY BY THE RIVERBANK IN DAYAPURVILLAGE IN SATJELLIA ISLAND: “WE DO NOT HAVECLEAN WATER AT THE MOMENT AND ONLY ONE TIME WEWERE LUCKY TO BE GIVEN SOME RELIEF. WE ARE NOWWAITING FOR THE GOVERNMENT TO SUPPLY US WITHWATER TANKS”.

10

glossa

ry & appendix

|GLOSSARY

conversion factors - fossil fuels

MJkg

MJ/kg

GJ/barrel

kJ/m3

1 cubic

1 barrel

1 US gallon

1 UK gallon

0.0283 m3

159 liter

3.785 liter

4.546 liter

FUEL

Coal

Lignite

Oil

Gas

23.03

8.45

6.12

38000.00

conversion factors - different energy units

Gcal

238.8

1

107

0.252

860

Mbtu

947.8

3.968

3968 x 107

1

3412

GWh

0.2778

1.163 x 10-3

11630

2.931 x 10-4

1

FROM

TJ

Gcal

Mtoe

Mbtu

GWh

Mtoe

2.388 x 10-5

10(-7)

1

2.52 x 10-8

8.6 x 10-5

TO: TJMULTIPLY BY

1

4.1868 x 10-3

4.1868 x 104

1.0551 x 10-3

3.6

116


canada: reference scenario

10

glossa

ry & appendix

|APPENDIX

- CANADA

District heating plantsFossil fuelsBiomassSolar collectorsGeothermal

Heat from CHP Fossil fuelsBiomassGeothermalFuel cell (hydrogen)

Direct heating1)

Fossil fuelsBiomassSolar collectorsGeothermal

Total heat supply1)

Fossil fuelsBiomassSolar collectorsGeothermalFuel cell ((hydrogen)

RES share (including RES electricity)

1) heat from electricity (direct and from electric heat pumps) not included; covered in the model under ‘electric appliances’

Condensation power plantsCoalLigniteGasOilDiesel

Combined heat & power productionCoalLigniteGasOil

CO2 emissions electricity & steam generationCoalLigniteGasOil & diesel

CO2 emissions by sector% of 1990 emissionsIndustryOther sectorsTransportElectricity & steam generationDistrict heating

Population (Mill.)CO2 emissions per capita (t/capita)

table 10.1: canada: electricity generationTWh/a

table 10.4: canada: installed capacity GW

table 10.5: canada: primary energy demand PJ/A

table 10.3: canada: co2 emissionsMILL t/a

table 10.2: canada: heat supplyPJ/A

2015

66948574361

10810377181000

1200120000

120

68116848575561

1080

40637718111000

58560

544

192.7%

59.6%

2020

71056455451

11512383381000

1400140100

141

72417456456751

1150

43538338113000

62590

581

395.4%

60.1%

2030

80789247731

13216395673000

1600140100

142

82220889249131

1320

48239567317000

73700

659

708.5%

58.6%

2040

902101249911

14920407964000

1800160200

154

9212421012411511

1490

52940796422000

85810

738

10010.9%

57.5%

2050

9991122412201

166244191256000

2000170200

155

1,0192761122413901

1660

577419125626000

96930

816

13112.8%

56.6%

Power plantsCoalLigniteGasOilDieselNuclearBiomassHydroWindPVGeothermalSolar thermal power plantsOcean energy

Combined heat & power productionCoalLigniteGasOilBiomassGeothermalHydrogenCHP by producerMain activity producersAutoproducers

Total generationFossilCoalLigniteGasOilDiesel

NuclearHydrogenRenewablesHydroWindPVBiomassGeothermalSolar thermalOcean energy

Distribution lossesOwn consumption electricityElectricity for hydrogen productionFinal energy consumption (electricity)

Fluctuating RES (PV, Wind, Ocean)Share of fluctuating RES

RES share

2007

63046703191938

36830000

1000100000

100

64016646704191930

380368308000

54520

508

30.5%

59.4%

2015

1348910211518070000

30030000

30

13633891321150

8980702000

75.3%

65.1%

2020

14498122115281141000

30030000

30

14835981621150

98811412000

159.9%

66.2%

2030

166154181117384232000

40030000

30

170411542111170

111842323000

2514.5%

65.7%

2040

189174230119386333000

40040000

31

193481742701190

126863334000

3518.4%

65.2%

2050

212194280121489433000

40040000

31

216551943201210

140894335000

4621.5%

64.7%


Combined heat & power productionCoalLigniteGasOilBiomassGeothermalHydrogen

CHP by producerMain activity producersAutoproducers




RES share

2007

1217107211327720000

20020000

20

12329710921130

8177202000

21.7%

65.9%

2015

11,8158,571681546

3,2524,092

1,1782,0661,356

659

62790

16.9%

2020

12,2078,742738386

3,3364,282

1,2552,2101,3791371866970

17.5%

2030

12,9799,034980207

3,4604,388

1,4412,5041,4232413380150

18.7%

2040

13,5769,1601,076199

3,5534,331

1,6272,7901,4663463194150

20.0%

2050

14,3579,4481,177192

3,7984,281

1,8133,0961,51045034

1,09650

21.0%

TotalFossilHard coalLigniteNatural gasCrude oil

NuclearRenewablesHydroWindSolarBiomassGeothermalOcean EnergyRES share

2007

11,8598,956667703

3,4004,185

1,0201,8831,326

110

54600

15.3%

2015

12945611941

40040

1334561235

533117%

819716313358

35.515.0

2020

12151432340

50050

1255143284

534117%

8210316712557

37.114.4

2030

13476233220

50050

1397623373

553121%

7910917113956

40.113.8

2040

15287224210

50050

1578722471

576126%

7611617615653

42.513.6

2050

16996215100

60050

1759621570

600132%

7212218117352

44.413.5

2007

14142781471

70060

1484278208

547120%

8210115914856

32.916.6

2015

20200

1919100

3,0492,625406711

3,0702,6434087110

13.9%

2020

30300

2119100

3,1442,720402148

3,1682,7394061480

13.5%

2030

20200

2422300

3,3232,806488236

3,3492,8284922360

15.6%

2040

40300

2924500

3,4992,897582165

3,5322,9215891650

17.3%

2050

50400

3225700

3,6772,970689135

3,7142,9957001350

19.3%

2007

20200

3534100

3,0062,66634000

3,0422,700343000

11.3%

table 10.6: canada: final energy demandPJ/a 2015

8,7477,8092,4912,260174421690

2.0%

2,49477946421357263

1,0071

36700

33.5%

2,8241,163693002

5241,039

6829

27.9%

1,67521.4%

93878613516

2020

9,1178,1212,5602,310174601690

2.7%

2,54680148123553261

1,0365

36700

33.7%

3,0151,274765102

5661,079

9787

28.5%

1,78622.0%

99683514417

2030

9,6878,6612,6522,3752035518110

2.5%

2,68889852725518235

1,0591244100

36.6%

3,3221,457854202

5921,156

12975

29.2%

2,01923.3%

1,02686014818

2040

10,2599,2042,7432,4402325021120

2.3%

2,8309955722890

1971,081

352500

39.2%

3,6311,640943411

6171,234

131175

29.7%

2,25024.4%

1,05588415218

2050

10,8309,7462,8352,5052614524140

2.1%

2,9701,09161830120

1511,075

062300

42.2%

3,9411,8231,032

731

6431,312

131364

30.2%

2,49925.6%

1,08490915719

Total (incl. non-energy use)Total (energy use)TransportOil productsNatural gasBiofuelsElectricity

RES electricityHydrogenRES share Transport

IndustryElectricity

RES electricityDistrict heat

RES district heatCoalOil productsGasSolarBiomass and wasteGeothermalHydrogenRES share Industry

Other SectorsElectricity


RES district heatCoalOil productsGasSolarBiomass and wasteGeothermalRES share Other Sectors

Total RESRES share

Non energy useOilGasCoal

2007

8,5837,6142,4222,206174281590

1.5%

2,39873043430277259

1,0010

30000

30.7%

2,7941,085644601

5481,075

0780

25.9%

1,49419.6%

96981214017

117

canada: energy [r]evolution scenario

10

glossa

ry & appendix

|APPENDIX

- CANADA






2015

8,5477,6092,4502,2011743341261

2.4%

2,3867424622011671909684634840

36.5%

2,7741,12570039210

4651,044

157115

29.6%

1,75123.0%

93878613516

2020

8,3207,3232,3481,953174531529915

6.9%

2,25270846131195112891072342110

40.2%

2,7241,12072954340

409975369535

34.1%

1,99727.3%

99683514417

2030

7,4926,4662,0411,3762038235324927

17.2%

1,85460442755481449687127277410

49.6%

2,5711,0987761661440

181732164130100

51.1%

2,58340.0%

1,02686014818

2040

6,5705,5151,69974723110357944739

34.2%

1,422485375898206

437126219600

60.6%

2,3931,074829218201049471225193163

67.3%

3,05455.4%

1,05588415218

2050

5,3644,2801,2562902597560156930

53.5%

86431930212211803

15275150410

79.5%

2,1601,023968235227044171212299177

87.2%

3,24275.7%

1,08490915719



IndustryElectricity






Total RESRES share


2007

8,5837,6142,4222,206174281590

1.5%

2,39873043430277259

1,0010

30000

30.7%

2,7941,085644601

5481,075

0780

25.9%

1,49419.6%

96981214017



Direct heating1)

Fossil fuelsBiomassSolar collectorsGeothermal

Total heat supply1)

Fossil fuelsBiomassSolar collectorsGeothermalFuel cell (hydrogen)

RES share (including RES electricity)‘Efficiency’ savings (compared to Ref.)

1) heat from electricity (direct and from electric heat pumps) not included; covered in the model under ‘electric appliances’






2015

641454889304813377162001

1900160200

163

660201454810530480

41137716215001

53520

530

192.8%

62.2%21

2020

6554327133001215389275003

2700220500

216

682226442715500120

44438927520003

51506

550

355.1%

65.1%69

2030

662368

13400014397588006

38002701100

2414

700205368

1610000

49539758825106

474711

571

7210.3%

70.6%181

2040

667240

1100009

41094101010

53003002110

2726

720164240

1400000

5564109410302010

434415

594

11415.8%

77.2%299

2050

5840090002

437110120014

71002604220

3140

6553500360000

62043711012443014

394111

540

13620.8%

94.6%437







RES share‘Efficiency’ savings (compared to Ref.)

2007

63046703191938

36830000

1000100000

100

64016646704191930

380368308000

54520

508

30.5%

59.4%0

2015

134782110728061001

40040000

41

1384178251070

9080612001

85.7%

65.3%

2020

1447531002382103003

60050100

51

1504875360020

101821034003

1510.3%

67.3%

2030

1566131000284205006

80060200

53

1644461370000

119842055006

3118.7%

72.9%

2040

16640250001873260010

110070400

65

1773640320000

1418732650010

4827.3%

79.7%

2050

1540020000933870014

140060800

68

16880080000

1609338780014

5935.2%

95.5%







RES share

2007

1217107211327720000

20020000

20

12329710921130

8177202000

21.7%

65.9%

2015

11,3018,621637460

3,6673,858

5242,1571,357

5868652202

18.5%513

2020

10,7458,184589231

3,8423,522

1312,4301,400

971277454911

22.2%1,506

2030

9,3256,28545069

3,1552,611

03,0411,42920932888416922

32.1%3,705

2040

7,8244,3333070

2,2961,730

03,4911,47633839995229036

44.1%5,820

2050

5,9222,257

740

9311,253

03,6651,57339634199431150

61.4%8,523


NuclearRenewablesHydroWindSolarBiomassGeothermalOcean EnergyRES share‘Efficiency’ savings (compared to Ref.)

2007

11,8598,956667703

3,4004,185

1,0201,8831,326

110

54600

15.3%0

2015

13341513820

60060

1394251442

516113%

759415913851

3514.5

2020

12239265700

80080

1303926650

466102%

668614112845

3712.6

2030

953185600

1000100

105318660

33473%46559910132

408.3

2040

672104600

1100110

77200570

20645%2931547121

424.9

2050

400400

90090

1300130

7116%151421616

441.6

2007

14142781471

70060

1484278208

547120%

8210115914856

32.916.6

2015

2202101

3731600

2,9522,4883796025

3,0122,51940661260

16.4%

58

2020

3002722

55411400

2,8152,25139410862

2,9002,292435109640

21.0%

268

2030

1300

110812

92553240

2,3631,532364291175

2,5841,5875072991910

38.6%

765

2040

1690

1351222

1396365100

1,880890364351275

2,1889535643633080

56.4%

1,344

2050

1530

1221120

20463119210

1,262320393287262

1,6193846342983030

76.3%

2,094

2007

20200

3534100

3,0062,66634000

3,0422,700343000

11.3%

0

table 10.12: canada: final energy demandPJ/a

118


10

glossa

ry & appendix

|APPENDIX

- CANADA

canada: advanced energy [r]evolution scenario



IndustryElectricity






Total RESRES share


2007

8,5837,6142,4222,206174281590

1.5%

2,39873043430277259

1,0010

30000

30.7%

2,7941,085644601

5481,075

0780

25.9%

1,49419.6%

96981214017

table 10.18: canada: final energy demandPJ/a








Direct heating1)

Fossil fuelsBiomassSolar collectorsGeothermalHydrogen

Total heat supply1)

Fossil fuelsBiomassSolar collectorsGeothermalFuel cell (hydrogen)

RES share (including RES electricity)‘Efficiency’ savings (compared to Ref.)1) heat from electricity (direct and from electric heat pumps) not included; covered in the model under ‘electric appliances’






2015

64238428930488

391202101

1900160200

163

660188384210530480

42539120210101

53520

531

233.4%

64.3%21

2020

666382210400127

420525303

2800230500

217

694187382212700120

49542052512303

51506

562

608.6%

71.4%69

2030

701363990004

445958407

39002601120

2316

740164363

1250000

57644595815607

474711

611

11014.9%

77.8%181

2040

739320630002

470140107015

55002802152

2530

794123320910002

669470140102212015

434421

662

16520.8%

84.3%297

2050

6650000000

473156124020

750023033144

2946

7402400230004

712473156123318020

394128

608

18825.4%

96.2%432







RES share‘Efficiency’ savings (compared to Ref.)

2007

63046703191938

36830000

1000100000

100

64016646704191930

380368308000

54520

508

30.5%

59.4%0

2015

136672110718381001

40040000

41

1403967251070

9483811001

96.8%

67.3%

2020

1516424002189193003

60050100

52

1573964290020

116891932103

2515.7%

74.0%

2030

1696123000194335107

80060200

53

1783561290000

142943353107

4425.0%

80.2%

2040

19050150000

1004861015

110060410

56

2012650210000

17510048642015

6934.3%

86.9%

2050

1820000000

1005471020

150050631

69

19650050001

19010054763020

8141.1%

97.0%







RES share

2007

1217107211327720000

20020000

20

12329710921130

8177202000

21.7%

65.9%

2015

11,2368,534563402

3,8043,765

5242,1781,408

7270583432

18.7%573

2020

10,5587,754544189

3,7583,263

1312,6731,51218716668011811

24.9%1,693

2030

9,0895,64744626

2,8292,347

03,4421,60234233183430725

37.4%3,941

2040

7,7583,6093860

1,7221,501

04,1491,69250434799256054

53.1%5,886

2050

6,1521,563

790

4351,049

04,5891,703562315

1,03690272

74.3%8,293


NuclearRenewablesHydroWindSolarBiomassGeothermalOcean EnergyRES share‘Efficiency’ savings (compared to Ref.)

2007

11,8598,956667703

3,4004,185

1,0201,8831,326

110

54600

15.3%0

2007

14142781471

70060

1484278208

547120%

8210115914856

32.916.6

2015

2101911

3931610

2,9692,55631962310

3,0292,58834463340

14.6%

41

2020

4403734

64451540

2,8412,276334145850

2,9492,320387148930

21.3%

219

2030

120096816

1095834161

2,3571,4903502942230

2,5861,5484803022541

40.1%

763

2040

1970

1581426

1806266475

1,78780433329735320

2,18486555731142625

60.2%

1,347

2050

1840

1381729

2934710412913

1,1258532325646221

1,62313256527262134

91.8%

2,090

2007

20200

3534100

3,0062,666340000

3,0422,700343000

11.3%

0

2015

12035453820

60060

1263545442

503110%

79921571255135

14.2

2020

10034214500

80080

1083421530

43495%71791351064337

11.7

2030

763134200

1000100

85313510

29064%4750888123407.2

2040

542802700

1000100

64280360

16336%2729395810423.8

2050

000000

80080

80080

296%85736440.7

2015

8,5637,6252,4502,1701607445291

4.2%

2,394742477382165194

1,0554625040

33.3%

2,7811,12372222120

4051,086

1610722

31.6%

1,78023.4%

93878613516

2020

8,3567,3602,3481,87715011219313815

11.1%

2,26870950647346312998487236130

38.6%

2,7441,12079961430

2441,065

5914155

40.0%

2,23330.3%

99683514417

2030

7,4926,4662,0411,22213017148938129

28.1%

1,84960246967591447710185189370

50.7%

2,5761,102857162144096748109210150

57.1%

2,98146.1%

1,02686014818

2040

6,5705,5151,69953611022877064956

54.3%

1,4174854091059903

4011751369321

65.5%

2,3991,079910273258046427122248202

72.6%

3,59265.1%

1,05588415218

2050

5,3624,2781,2561029023575472676

82.3%

8763233111671610189114659521

87.5%

2,1471,0369973092980359

142310306

95.6%

3,85190.0%

1,08490915719

10

glossa

ry & appendix

|APPENDIX

- CANADA

canada: total new investment by technology

notes

table 10.19: canada: total investmentMILLION $ 2007-2050

AVERAGEPER YEAR

2,0905,283275

3,6211,277106031

1,2846,712680

3,8361,112279821

722

1,1198,165504

4,2201,6682795381

954

2007-2050

89,865227,16811,804155,72054,9154,539

012862

55,208288,62529,236164,93047,80812,0123,517

6231,059

48,133351,07721,675181,45371,71412,01223,149

5541,019

2021-2030

30,25873,2112,99053,33915,0201,827

0034

10,56184,3954,94250,37816,1513,7308180

8,375

10,218107,5944,81762,80620,2493,7304,837

011,156

2011-2020

27,33369,0464,69549,74413,4721,111

0023

25,22290,0119,83653,8188,0586,5591320

11,608

16,809125,1625,54875,19020,3156,5595,943

011,608

2007-2010

18,69937,9141,21129,6296,4415990034

18,69937,9141,21129,6296,4415990034

18,69937,9141,21129,6296,4415990034

Reference scenario

Conventional (fossil & nuclear)RenewablesBiomassHydroWindPVGeothermalSolar thermal power plantsOcean energy

Energy [R]evolution




Greenpeace is a global organisation that uses non-violent direct action to tacklethe most crucial threats to our planet’s biodiversity and environment.Greenpeace is a non-profit organisation, present in 40 countries across Europe,the Americas, Africa, Asia and the Pacific. It speaks for 2.8 million supportersworldwide, and inspires many millions more to take action every day. Tomaintain its independence, Greenpeace does not accept donations fromgovernments or corporations but relies on contributions from individualsupporters and foundation grants.

Greenpeace has been campaigning against environmental degradation since1971 when a small boat of volunteers and journalists sailed into Amchitka, anarea west of Alaska, where the US Government was conducting undergroundnuclear tests. This tradition of ‘bearing witness’ in a non-violent manner continuestoday, and ships are an important part of all its campaign work.

Greenpeace Canada33 Cecil Street, TorontoOntario, Canada M5T 1N1 t +416 597 8408454, avenue Laurier Est, 3e étage, MontréalQuébec, Canada H2J 1E7 t +514 933 00211726 Commercial Drive, VancouverBritish Columbia, Canada V5N 4A3 t +604 253 77016238 – 104 Street NW, EdmontonAlberta, Canada T6H 2K9 t +780 430 9202www.greenpeace.ca

european renewable energy council - [EREC]Created in April 2000, the European Renewable Energy Council (EREC) isthe umbrella organisation of the European renewable energy industry, tradeand research associations active in the sectors of bioenergy, geothermal, ocean,small hydro power, solar electricity, solar thermal and wind energy. EREC thusrepresents the European renewable energy industry with an annual turnover of€70 billion and employing 550,000 people.

EREC is composed of the following non-profit associations and federations:AEBIOM (European Biomass Association); EGEC (European GeothermalEnergy Council); EPIA (European Photovoltaic Industry Association); ESHA(European Small Hydro power Association); ESTIF (European Solar ThermalIndustry Federation); EUBIA (European Biomass Industry Association);EWEA (European Wind Energy Association); EUREC Agency (EuropeanAssociation of Renewable Energy Research Centers); EREF (EuropeanRenewable Energies Federation); EU-OEA (European Ocean EnergyAssociation); ESTELA (European Solar Thermal Electricity Association).

EREC European Renewable Energy CouncilRenewable Energy House, 63-67 rue d’Arlon B-1040 Brussels, Belgiumt +32 2 546 1933 f+32 2 546 [email protected] www.erec.org

energy[r]evolution

© GREENPEACE/NICK COBBING

image ICE MELTING ON A BERG ON THE GREENLANDIC COAST. GREENPEACE AND AN INDEPENDENT NASA-FUNDED SCIENTIST COMPLETED MEASUREMENTS OF MELT LAKES ON THE GREENLAND ICE SHEET THAT SHOW ITS VULNERABILITY TO WARMING TEMPERATURES. front cover images WIND TURBINE SPINNING AROUND GENERATING POWER,STLEON, 150 KM SOUTH WEST OF WINNIPEG, MANITOBA © RICHARD GILLARD / ISTOCK © PGIAM / ISTOCK © BRENDAN HUNTER / ISTOCK.

Documents

Energy [R]evolution: A Sustainable Energy Outlook for Canada