Energy and transport in 2050 – will we overcome the nexus between energy consumption and economic growth?

ESMT Annual Forum 2014

Jens Weinmann Berlin, 3 July 2014

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Global human population

(in billions)

7/8/2014 1

Present 2010-2013

ESMT Annual Forum 2014 – Energy and transport in 2050

How many ‘Earths‘ worth of resources do we consume?

Past 1970-2010 Future 2013-2050

Our ecological footprint: Past, present and future

Source: WWF Living Planet Report (2013)

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Human development and the Ecological Footprint: Either one or the other…

7/8/2014 2 ESMT Annual Forum 2014 – Energy and transport in 2050

Meets minimum criteria for sustainability

Source: WWF Living Planet Report (2012)

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The environmental Kuznets curve: Cement consumption per capita vs. 2012 GDP per capita

7/8/2014 ESMT Annual Forum 2014 – Energy and transport in 2050 3

Source: Deutsche Bank (2014)

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The environmental Kuznets curve: Cement consumption per capita vs. 2012 GDP per capita

7/8/2014 ESMT Annual Forum 2014 – Energy and transport in 2050 4

3.95 billion people

´

China

India

Indonesia

Turkey Egypt

Mexico Brazil

Bangladesh

Nigeria

Pakistan

Russia

Philippines

Source: Deutsche Bank (2014), World Bank (2014)

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The environmental Kuznets curve: Cement consumption per capita vs. 2012 GDP per capita

7/8/2014 ESMT Annual Forum 2014 – Energy and transport in 2050 5

1 billion people

>20,000 𝑈𝑆−$

𝑐𝑎𝑝

6 billion people

<20,000 𝑈𝑆−$

𝑐𝑎𝑝

Source: Deutsche Bank (2014), World Bank (2014)

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Energy intensity is not declining fast enough

7/8/2014 6 ESMT Annual Forum 2014 – Energy and transport in 2050

Source: IEA World Energy Outlook (2012)

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Total primary energy demand

(in ‘000 Mtoe)

7/8/2014 7

Present 2010-2013

ESMT Annual Forum 2014 – Energy and transport in 2050

Past 1970-2010 Future 2013-2050

Total primary energy demand will increase by 70% until 2050, according to the International Energy Agency‘s BAU (6°C) scenario…

6°C – Business as usual

2°C – CC scenario

Source: IEA ETP (2014)

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Solar photovoltaic price drop mirrors high tech consumer goods

7/8/2014 ESMT Annual Forum 2014 – Energy and transport in 2050 8

Source: Fraunhofer ISE (2014)

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The levelized costs of photovoltaic energy range from a minimum of 0.08 EURcts/kWh in southern Mediterranean to 32 EURcts/kWh in the most northern regions

7/8/2014 9 ESMT Annual Forum 2014 – Energy and transport in 2050

Source: Ossenbrink et al. / Joint Research Council (2013)

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About 40 percent of the world‘s population lives in the tropical belt

7/8/2014 10

Tropical belt

ESMT Annual Forum 2014 – Energy and transport in 2050

Source: PBH / ATI (2013)

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Evolution of global new solar photovoltaic installations 2000-2013 – rapid development in Asia combined with a sharp drop of installations in Europe

7/8/2014 11

In the IEA’s 2°C-High Renewables Scenario solar becomes the dominant electricity source by 2040, providing 26% of global generation by 2050

ESMT Annual Forum 2014 – Energy and transport in 2050

Sources: EPIA (0214), Ossenbrink et al. / Joint Research Council (2013), IEA ETP (2014)

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Will we run out of energy?

7/8/2014 ESMT Annual Forum 2014 – Energy and transport in 2050 12

Source: Richard Perez (2011)

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Light duty passenger vehicles

(in millions)

7/8/2014 13

Present 2010-2013

ESMT Annual Forum 2014 – Energy and transport in 2050

Past 1970-2010 Future 2013-2050

The global car fleet will continue to grow…

6°C – Business as usual

2°C – CC scenario

Source: IEA ETP (2014)

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The car will remain the preferred means of transport – but which technologies and business models will dominate?

7/8/2014 14

Air 9%

Light road 58%

Heavy road 22%

Rail 11%

Passenger kilometers in IEA’s 2°C scenario in 2050

(World total of 85 trillion km)

ESMT Annual Forum 2014 – Energy and transport in 2050

Sources: IEA ETP (2014) / IEA Global Tranposrt Outlook / Dulac (2012)

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Industrialized countries: The car loses its power as a status symbol for the younger generation

18 to 25 year old Germans: declining affinity to cars

Sources: Bratzel/Center of Automotive Management (2011); Destatis / KBA (2013)

Yes 24%

No 76%

n=1159

Can you imagine to live without cell phone and internet for a month?

&

Yes 59%

No 41%

Can you imagine to live without a car for a month? n=1134

New car registrations and demographics

0

2

4

6

8

10

12

14

16

0

50,000

100,000

150,000

200,000

250,000

300,000

350,000

400,000

<20 20-29 30-39 40-49 50-59 60-69 70-79 >79

Inh

abit

ants

(m

illio

n)

New

car

reg

istr

atio

ns

(201

0)

Age group

Inhabitants New car registrations

7/8/2014 15 ESMT Annual Forum 2014 – Energy and transport in 2050

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Free-floating: A new car-sharing service for the digital society

Daimler was the pioneer of free-floating car-sharing Exponential growth in car-sharing

*compared to Jan 1, 2013 Sources: car2go/Daimler (2014), Verkehrsclub Deutschland (2014)

User free-floating

User classic car clubs

Vehicles free-floating

Vehicles classic car clubs

14,000 vehicles

760,000 users

1997 1/1/2014

…as of Jan 1, 2014 Classic car clubs Free floating

Suppliers approx. 150 3

Cities participating 380 (+38*) 12 (+6*)

Users 320,000 (+50,000*) 437,000 (+254,000*)

Vehicles 7,700 (+1,000*) 6,250 (+1,700*)

Stations 3,900 (+650*)

Car2go is active at 25 locations in seven European and North American countries

approximately 10,000 smart fortwo vehicles are being used

by more than 600,000 customers

7/8/2014 16 ESMT Annual Forum 2014 – Energy and transport in 2050

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Electric vehicles are not only an expensive toy in industrialized countries: Tesla Model S vs. BMW i3 vs. Reva e2o

10 kWh

60-100 km 390-500 km

85 kWh 19 kWh

130-160 km

7/8/2014 17 ESMT Annual Forum 2014 – Energy and transport in 2050

Sources: Company websites (2014)

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Tesla’s Gigafactory will decrease battery price of batteries by 30%

By the end of the first year of volume production of our mass market vehicle, we expect the

Gigafactory will have driven down the per kWh cost of our battery pack by more than 30 percent.

Source: Tesla Motors (2014)

7/8/2014 18 ESMT Annual Forum 2014 – Energy and transport in 2050

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In the foreseable future, we will not be able to decouple energy and economic growth…

…but it does not matter as much as we think, because we will have abundant renewable

energy available!

Key Take-Away

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#esmt2050

ESMT European School of Management and Technology

Schlossplatz 1 10178 Berlin

Phone: +49 (0) 30 192 31-0 Fax: +49 (0) 30 192 31-9

info@esmt.org www.esmt.org

Dr. Jens Weinmann

Program Director

jens.weinmann@esmt.org +49 (0) 30 21231-8052

Thank you for your attention!