“what’s our energy future” · 1/19/2013 · michael liebreich, washington dc, 19 january...

MICHAEL LIEBREICH, Washington DC, 19 January 2013 TWITTER: @MLiebreich 1 / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / /

ENERGY ALL-STARS:

“WHAT’S OUR ENERGY

FUTURE”

WASHINGTON DC

19 JANUARY 2013

Michael Liebreich, Chief Executive

Bloomberg New Energy Finance

Twitter: @MLiebreich

MICHAEL LIEBREICH, Washington DC, 19 January 2013 TWITTER: @MLiebreich 2 / / / /

ABOUT BLOOMBERG NEW ENERGY FINANCE

San Francisco New York

Washington DC

Sao Paulo

Cape Town Sydney

Hong Kong New Delhi

London

Beijing Tokyo

Zurich

Singapore

200 people: world’s leading

provider of information on

clean energy, water, power

and carbon markets


Prediction is

very difficult,

especially

about the

future.

THE FUTURE

Nils Bohr

Physicist


$54bn

$80bn

$114bn

$164bn

$191bn $187bn

$251bn

$302bn

$269bn

48%

43%

45%

16%

-2%

34%

20% -11%

2004 2005 2006 2007 2008 2009 2010 2011 2012

GLOBAL TOTAL NEW INVESTMENT IN CLEAN ENERGY 2004–12 ($BN)

Source: Bloomberg New Energy Finance

Note: Includes corporate and government R&D, and small distributed capacity. Adjusted

for re-invested equity. Does not include proceeds from acquisition transactions


TOTAL INVESTMENT IN CLEAN ENERGY

Source: Bloomberg New Energy Finance, Columbia Pictures

In clean energy, a billion

dollars isn’t cool. You know

what’s cool?

A trillion dollars.

That’s cool


CLEAN VS FOSSIL-BASED GENERATING CAPACITY

INVESTMENT, 2006–12 ($BN)

Source: Bloomberg New Energy Finance, EIA

Note: Clean energy total excludes large hydro. Fossil fuel is investment on coal and

gas capacity. We assume capacity retirement of 3.3%/yr for coal and 4%/yr for gas.

Clean energy

Fossil fuel

0

50

100

150

200

250

300

350

2006 2007 2008 2009 2010 2011 2012


NEW INVESTMENT IN CLEAN ENERGY BY REGION 2004–12 ($BN)

Source: Bloomberg New Energy Finance Note: Excludes corporate and government R&D

7.1

14.2

28.9

40.8 39.0

27.1

41.8

63.1

40.3

2004 2005 2006 2007 2008 2009 2010 2011 2012

North America & Caribbean

0.83.5

5.4

11.114.5

10.312.9

9.9 10.0

2004 2005 2006 2007 2008 2009 2010 2011 2012

Central & South America

18.0

28.5

36.5

58.4

70.7 73.2

97.8

108.0

75.8

2004 2005 2006 2007 2008 2009 2010 2011 2012

Europe

0.3 0.5 1.1 1.5 2.7 1.64.9 4.2

11.8

2004 2005 2006 2007 2008 2009 2010 2011 2012

Middle East & Africa

9.515.2

22.4

30.6

39.947.3

66.8

87.1

100.7

2004 2005 2006 2007 2008 2009 2010 2011 2012

Asia & Oceania


TOP 15 COUNTRIES FOR NEW INVESTMENT IN CLEAN

ENERGY IN 2012 AND % CHANGE ON 2011 ($BN)


2.95

3.42

4.05

4.31

4.41

5.34

5.46

6.19

6.85

8.34

14.71

16.28

22.80

35.58

65.13

-68%

179%

11%

-34%

-23%

-32%

20563%

40%

-45%

-17%

-51%

75%

-27%

-37%

20%

Spain

Greece

Belgium

France

Canada

Brazil

South Africa

Australia

India

United Kingdom

Italy

Japan

Germany

United States

China


CHINA’S AIR QUALITY PROBLEM (PM2.5 microgrammes per cubic meter)

Picture credit: Feng Li/Getty Images

World Health

Organisation

Guideline

Beijing

12 Jan 2013

993

25


NEW INVESTMENT IN CLEAN ENERGY BY SECTOR IN 2012

AND % CHANGE ON 2011 ($BN)


0.06

0.19

1.58

2.81

3.24

7.35

9.03

76.56

137.68

84%

52%

-41%

-50%

-33%

18%

-28%

-13%

-9%

Other

Marine

Geothermal

Biofuels

Energy smart technologies

Small hydro

Biomass & Waste

Wind

Solar


EU NET CAPACITY ADDITIONS (GW)

Source: EWEA, Bloomberg New Energy Finance,

0

10,000

20,000

30,000

40,000

50,000

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

Other

Gas

PV

Wind


Note: Values as of 07 January 2013; NASDAQ and S&P 500 rebased to 100 on 01 Jan 2003

NEX CLEAN ENERGY INDEX 2003 – 2013 YTD


0

100

200

300

400

500

Jan-03 Jan-04 Jan-05 Jan-06 Jan-07 Jan-08 Jan-09 Jan-10 Jan-11 Jan-12 Jan-13

S&P 500

NASDAQ

NEX


NEX CLEAN ENERGY INDEX 2011 – 2013 YTD

Source: Bloomberg New Energy Finance Note: Values as of 07 January 2013; NASDAQ and S&P 500 rebased to 100 on 01 Jan 2011.

50

60

70

80

90

100

110

120

130

140

150

Jan-11 Jul-11 Jan-12 Jul-12 Jan-13 Jul-13

S&P 500

NASDAQ

NEX


EUROPE – FINANCIAL CRISIS

Photo: Bloomberg


Picture Credits: Bloomberg

All of the above! Starting

with the Wind Production

Tax Credit!

Solyndra! Solyndra!

US ELECTION


PV EXPERIENCE CURVE, 1976-2012

2012 $/W

Source: Paul Maycock, Bloomberg New Energy Finance Note: Prices inflation indexed to US PPI.

MW

0.1

1

10

100

1 10 100 1,000 10,000 100,000 1,000,000

historic prices (Maycock) experience curveChinese c-Si module prices (BNEF) Thin-film experience curveFirst Solar thin-film module cost

1976

1985

2003

2006

2012 2012

PV MODULE PRICES HAVE

FALLEN 80% SINCE 2008

20% IN 2012 ALONE


CLEAN ENERGY COST COMPETITIVENESS – AFRICA

Picture Credit: SolarSister Note: Illustrative figures for cost of 2 lamps plus mobile phone charging, Kenya, 2012

Kerosene

$4 per week Solar PV

$1 per week


AVERAGE LEVELISED COST OF ONSHORE WIND, 1984-

2012 (€/MWH)

Source: Bloomberg New Energy Finance, ExTool Note: Learning curve (blue line) is least square regression: R2 = 0.88 and 14% learning rate.

14%

1984

1990

20002004

2012

10

50

100

500

100 1,000 10,000 100,000 1,000,000

MW

WIND TURBINE PRICES

HAVE FALLEN 29% SINCE

2008


EVOLUTION OF WIND POWER

Photos: Bloomberg

1984

2011



GRID-COMPETITIVE CLEAN ENERGY

=

Natural Gas

at $6/MMBtu

=

New

coal

Best Wind


SHALE GAS ‘FRACKING’ BREAKEVEN PRICE, USA

($/MMBTU)

Source: Bloomberg New Energy Finance; Various

Note: Assumes 15% equity IRR. UK assumes $8m Drilling & Completion cost; 2000-4250 mcfd

dry production (per Marcellus and Eagle Ford); 20% royalty rate; usual tax treatment

19 Jan 2013

Henry Hub

$3.57/MMBTU


You know,

we’re making

no money.

It’s all in the

red.”

US NATURAL GAS, 2012

Rex Tillerson

CEO, Exxon


LITHIUM-ION BATTERY EXPERIENCE CURVE

Source: Battery University, MIIT, IIT, Bloomberg New Energy Finance

EV BATTERY PRICES

HAVE FALLEN 40% SINCE

2010

Cost-competitiveness (on total ownership basis)


Fundamental re-engineering of the world’s

energy sector around a more distributed, lower carbon, more secure architecture

• Will cost trillions of dollars

• Will take decades

• Will be supported by government actions

• Will be funded largely by capital markets

Source: New Energy Finance

FUTURE OF ENERGY


INDUSTRY CONSOLIDATION EXAMPLE - US CAR

MANUFACTURERS

1903 2012 Major Manufacturers

Source: Age of the Moguls; Bloomberg New Energy Finance


WIND GENERATION ADDITIONS (GW)

Asia & Oceania

Americas

Europe, Middle East &

Africa

30GW

1984 0.2




Asia & Oceania

Americas


Africa

30GW

19900.2




Asia & Oceania

Americas


Africa

30GW

20049.0




Asia & Oceania

Americas


Africa

30GW

2011

42.4



SOLAR MANUFACTURING CAPACITY ADDITIONS (GW)

Asia & Oceania

Americas


Africa

10GW

2003

0.1




Asia & Oceania

Americas


Africa

10GW

2004

0.4




Asia & Oceania

Americas


Africa

10GW

2006

1.7




Asia & Oceania

Americas


Africa

10GW

2011

11.9



What can you do?

MLK DAY OF SERVICE


1. HUG A CLIMATE SCEPTIC…

Picture Credit: Philips

…AND GIVE THEM A BEAUTIFUL LED LIGHT BULB


2. BOOK A TEST DRIVE IN AN ELECTRIC VEHICLE…

Picture Credit: Tesla, Renault/Nissan;

BMW, Volkswagen, GM, Ford, Mercedes

…BECAUSE YOU’RE WORTH IT!


3. LEND SOMEONE THE MONEY TO GO SOLAR…

Note: Do your own research. Neither Michael Liebreich nor Bloomberg New Energy

Finance endorses any of the organisations mentioned here.

Abundance NRG

www.abundancegeneration.com

…ALL THE FEEL-GOOD, NONE OF THE HASSLE

Solar Mosaic

https://joinmosaic.com/

Sunfunder

www.sunfunder.com


Our energy

future is not

fate, but choice

THE FUTURE – TAKE 3

Amory Lovins

Founder & CEO

Rocky Mountain Institute

/ / / / / / / / / / / / / / / / / / / / / / / / / / / /

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THANK YOU!

MICHAEL LIEBREICH

TWITTER: @MLiebreich

“what’s our energy future” · 1/19/2013 · michael liebreich, washington dc, 19 january...

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