© OECD/IEA 2012

Tapping technology’s potential to secure a clean energy future

Ms. Maria van der HoevenExecutive DirectorInternational Energy AgencyHelsinki, 31 August 2012

Key messages

1. Sustainable energy future is still feasible and technologies exist to take us there

2. Despite potential of technologies, progress is too slow at the moment

3. A clean energy future requires systemic thinking and deployment of a variety of technologies

4. It even makes financial sense to do it!5. Government policy is decisive in unlocking the

potential

Energy demand and emissions have doubled in the past 40 years

From 6000 Mtoe to 12 000 Mtoe Rapid demand growth outside OECD

Source: IEA statistics

CO2 emissions from 14Gt to 30Gt Since 2005, non-OECD countries

emit more than OECD

ETP 2012 – Choice of 3 Futures

© OECD/IEA 2012

6DSwhere the world is now heading with potentially devastating results

The 6°C Scenario

4DSreflecting pledges by countries to cut emissions and boost energy efficiency

The 4°C Scenario

2DSa vision of a sustainable energy system of reduced Greenhouse Gas (GHG) and CO2 emissions

The 2°C Scenario

© OECD/IEA 2012

ETP2012: need to cut CO2 by 50% by 2050

To achieve ambitious climate goals, the world needs to cut energy-related CO2 emissions by 50% from today’s levels…

…but as populations grow and growth in energy consumption is inevitable, the reduction challenge is even higher: gap of 24-42 Gt in 2050

Clean energy: slow lane to fast track

© OECD/IEA 2012

Progress is too slow in almost all technology areas

Significant action is required to get back on track

Energy RD&D has slipped in priority

© OECD/IEA 2012

0%

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1974 1978 1982 1986 1990 1994 1998 2002 2006 2010

Shar

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Renewable energy Nuclear

Hydrogen and fuel cells Other power and storage technologies

Other cross cutting technologies/research Share of energy RD&D in total R&D

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2008 non-IEA country spending

© OECD/IEA 2012

A smart, sustainable energy system

© OECD/IEA 2012

A sustainable energy system is a smarter, more unified and integrated energy system

© OECD/IEA 2012

Renewables need to dominate EU electricity

Renewables cover two-thirds of the electricity mix in 2050 in the 2DS, with wind power alone reaching a share of 30% in the mix.

0

500

1 000

1 500

2 000

2 500

3 000

3 500

4 000

4 500

5 000

4DS 2DS

2009 2050

TWh

Other renewables

Wind

Solar

Hydro

Nuclear

Fossil w CCS

Fossil w/o CCS

53%

27%

2%

1%

7%

28%

22%

23%

10%

9%

13%

7%

10%

4%

21%

28%

4%13% 17%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

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4DS 2DS

2009 2050

Gene

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Other renewables

Wind

Solar

Hydro

Nuclear

Fossil w CCS

Fossil w/o CCS

Other renewables

Wind

Solar

Nuclear

Solar

Hydro

Fossil w/o CCS

Fossil w CCS

2009 2050

© OECD/IEA 2012

2009 2015 2020 2025 2030 2035 2040 2045 2050 0

2 500

5 000

7 500

10 000

2009 2015 2020 2025 2030 2035 2040 2045 2050 0

2 500

5 000

7 500

10 000

OECD Other non-OECD

TWh

Power generation from natural gas increases to 2030 in the 2DS and the 4DS.

From 2030 to 2050, generation differs markedly.

Natural gas-fired power generation must decrease after 2030 to meet the CO2 emissions projected in the 2DS scenario.

Two very different profiles for power generation

2DS4DS

Non-OECD

© OECD/IEA 2012

Finland: bio-energy and nuclear

Bio-energy and nuclear dominate Finland’s low-carbon energy sector after 2030

Contribution of fossil fuels is halved during the next four decades

© OECD/IEA 2012

2010 2015 2020 2025 2030 2035 2040 2045 2050 0

2 000

4 000

6 000

8 000

10 000

12 000Other industries

Chemicals and pe-trochemicals

Aluminium

Pulp and paper

Iron and steel

Cement

2 DS

Industry must become more efficient

© OECD/IEA 2012

Significant potential for enhanced energy efficiency can be achieved through best available technologies.

GtC

O2

© OECD/IEA 2012

Clean energy investment pays off

© OECD/IEA 2012

Every additional dollar invested in clean energy can generate 3 dollars in return.

USD trillion

Recommendations to Governments

© OECD/IEA 2012

1. Create an investment climate of confidence in clean energy

2. Unlock the incredible potential of energy efficiency – “the hidden” fuel of the future

3. Accelerate innovation and public research, development and demonstration (RD&D)

© OECD/IEA 2012

www.iea.org/etpFor much more, please visit