new bloomberg new energy finance summit · 2012. 3. 20. · day 2 - keynote 20 march 2012 michael...

MICHAEL LIEBREICH KEYNOTE, 20 MARCH 2012 TWITTER: @MLiebreich 1/ / / / / // / / / / / / / / / / / / / / / / / / / / / / / / / / / / / /

BLOOMBERG NEW ENERGY

FINANCE SUMMIT

DAY 2 - KEYNOTE

20 MARCH 2012

Michael Liebreich, Chief ExecutiveTwitter: MLiebreich

MICHAEL LIEBREICH KEYNOTE, 20 MARCH 2012 TWITTER: @MLiebreich 2/ / / / / /

TOTAL INVESTMENT IN CLEAN ENERGY

Source: Bloomberg New Energy Finance

A billion dollars isn‟t cool.

You know what‟s cool?

A trillion dollars.


GLOBAL TOTAL NEW INVESTMENT IN CLEAN ENERGY,

2004–11 ($BN)


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

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

$54bn

$75bn

$113bn

$153bn

$187bn $189bn

$247bn

39%

51%

35%

22%

1%

31%

2004 2005 2006 2007 2008 2009 2010

$0bn$0bn

$0bn

$0bn

$0bn $0bn

$260bn

5%

2004 2005 2006 2007 2008 2009 2010 2011

$0bn$0bn

$0bn

$0bn

$0bn $0bn

$260bn

5%

2004 2005 2006 2007 2008 2009 2010 2011

5%



TOTAL NEW CLEAN ENERGY FINANCIAL INVESTMENT,

2010–11 ($BN)

Note: Includes small distributed capacity and adjustments for re-invested equity. Does

not include corporate and government R&D or proceeds from acquisition transactions

2010 2011

5.5

8.0

8.6

8.6

9.4

10.2

28.0

30.6

45.5

48.1

Canada

Brazil

Spain

Japan

UK

India

Italy

Germany

China

US

5.3

6.6

6.9

6.9

7.0

7.0

20.2

32.1

33.7

45.0

Canada

India

Spain

Brazil

UK

Japan

Italy

Germany

US

China


Source: Bloomberg

NEW CLEAN ENERGY INVESTORS - BUFFETT


NEW CLEAN ENERGY INVESTORS - CHINA


EU NET CAPACITY ADDITIONS(MW)

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


0.1

1

10

100

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

historic prices experience curve Chinese c-Si module pricesThin-film experience curve First Solar thin-film module cost

1976

1985

2003

2006

2012

2012

THE PV MODULE EXPERIENCE CURVE, 1976–2012 ($/W)

Source: Paul Maycock, Bloomberg New

Energy Finance, FSLR filingsNotes: Inflation adjustment using US PPI, R2 of c-Si regression = 0.94, R2 of FSLR regression = 0.98

MW (log)

PRICES HAVE FALLEN

75% SINCE 2008

45% OVER PAST YEAR


0.00

0.10

0.20

0.30

0.40

0.50

0.60

20

04

20

05

20

06

20

07

20

08

20

09

20

10

20

11

20

12

COST PREMIUM OVER TIME FOR NEW TECHNOLOGY WITH

ADDED BENEFIT

Source: Bloomberg New Energy Finance, Federal Communications Commission, BSW Solar, Eurostat

TELEPHONES ($/MINUTE) PV (EUR/kWh)

0.00

0.10

0.20

0.30

0.40

0.50

19

93

19

94

19

95

19

96

19

97

19

98

19

99

20

00

20

01

20

02

20

03

20

04

20

05

20

06

20

07

Mobile

Fixed

German Feed-in tariff

Retail electricity

And taxes


LCOE

0.00

0.05

0.10

0.15

0.20

0.25

0.30

0.35

0.40

800 1,100 1,400 1,700 2,000 2,300

$/kWh

Hawaii

South China

EMEA ASOC AMER25GWkWh/kW/year

More sun

Residentialpower market

RESIDENTIAL PV PRICE PARITY

Source: Bloomberg New Energy Finance ,

EuroStat, grid operatorsNote: LCOE based on 6% cost of capital, 0.7%/year module degradation, 1% capex as O&M annually.

2009


LCOE

0.00

0.05

0.10

0.15

0.20

0.25

0.30

0.35

0.40

800 1,100 1,400 1,700 2,000 2,300

$/kWh

Spain

Germany

Italy

Denmark

Hawaii

South China

Australia


More sun





2012


LCOE

0.00

0.05

0.10

0.15

0.20

0.25

0.30

0.35

0.40

800 1,100 1,400 1,700 2,000 2,300

$/kWh

Spain

Germany

Italy

Denmark

France

Israel

Turkey

Mexico

California

Hawaii

New Jersey

Brazil

South China

North India

Japan

South Korea

Australia


More sun





2020


NEW ONSHORE WIND ENERGY GENERATING CAPACITY

BY COUNTRY, 2011


Puerto Rico Greenland Cayman Islands Cuba Guadeloupe Montserrat Netherlands Antilles Canada Barbados Bermuda Dominica

Dominican Republic Martinique St. Lucia St. Kitts & Nevis Trinidad & Tobago Haiti Grenada St. Vincent & the Grenadines

Jamaica Bahamas Antigua and Barbuda Saint Pierre and Miquelon Turks and Caicos Islands Virgin Islands, British Saint Martin

(French part) Virgin Islands, U.S. Anguilla American Samoa Aruba Saint Barthelemy Suriname Falkland Islands (Malvinas)

Argentina Costa Rica Peru Ecuador Paraguay French Guiana El Salvador Colombia Honduras Nicaragua Bolivia Brazil Guyana

Panama Guatemala Venezuela Mexico Belize Uruguay Chile Kazakhstan Kyrgyzstan India Taiwan Indonesia Cambodia China

Japan Iran (Islamic Republic) Korea (Republic) East Timor Nepal Korea (Democratic People's Republic) Malaysia

53%

47%

Zimbabwe Zambia South Africa Gabon Guinea-Bissau Gambia Ghana Guinea Djibouti Angola

Western Sahara Burundi Benin Burkina Botswana Central African Republic Cote d'Ivoire

Philippines Afghanistan Mongolia Myanmar Maldives Singapore Macau Sri Lanka Thailand

Tajikistan Turkmenistan Laos Pakistan Uzbekistan Bhutan Cocos (Keeling) Islands Christmas

Senegal Togo Niger Bulgaria

Malta Svalbard and Jan

Mayen Belgium

Portugal

Romania

Tome and Principe United Kingdom Ireland

Slovenia Slovakia Germany Isle of Man United

States Luxembourg Guernsey Hungary Cyprus

Lithuania Czech Republic Greece

Island Vietnam Brunei Bangladesh (Former Yugoslav Republic) Croatia Ukraine Holy See (Vatican City) Tunisia

Palestinian Authority Yemen Saudi Arabia Qatar Sudan Syria Oman Jordan Turkey Kuwait Lebanon Morocco Georgia

Libya Algeria Bahrain Egypt United Arab Emirates Armenia Azerbaijan Iraq Israel Equatorial Guinea Ethiopia

Congo (Dem. Rep.) Mayotte Congo Comoros Cape Verde Mali Reunion

Liberia Namibia Swaziland Saint Helena Somalia Rwanda Mozambique

Malawi Sierra Leone Mauritius Mauritania Seychelles Lesotho Chad

Madagascar Uganda Tanzania Nigeria Eritrea Kenya Sao

China


THE WIND EXPERIENCE CURVE, 1984-2011(€M/MW)

Source: Bloomberg New Energy Finance, ExToolNote: Learning curve (blue line) is least square regression: R2 = 0.77 and 7% learning rate.

7%

1984 1990 2000 2004 20110.5

1.0

2.0

4.0

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

MW


197

51

-79

-39

-10-18

0

50

100

150

200

LCOE 1984 Turbine price

reduction

Opex

declines

Hub height Efficiency LCOE 2012

LCOE REDUCTIONS, ONSHORE WIND, 1984-2012(EUR/MWH)


7% turbine cost

experience curve

7% efficiency

experience curve


AVERAGE LCOE OF ONSHORE WIND, 1984-2011(EUR/MWH)

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

14%

1984 1990 2000 2004 201110

50

100

500

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

MW


WIND AND WATER

Source: Bloomberg


07

/06

04

/10

09

/10

02

/11

05

/11

06

/11

01

/12

02

/12

$850m

$1,765m

0

50

100

150

200

250

Me

tab

olix

Co

de

xis

Am

yri

s

Ge

vo

In

c

So

lazym

e

KiO

R

RE

G

Ce

res

Co

ska

ta In

c

Myri

an

t

Ge

no

ma

tica

Ma

sco

ma

Ele

va

nce

RS

Fu

lcru

m

Bio

Am

be

r

En

erk

em

US NEXT-GEN BIOFUEL PUBLIC MARKET DEALS, 2006-12($M)

Souce: Bloomberg New Energy Finance

Completed Expected


NEXT-GENERATION BIOFUEL FACILITIES

Source: Bloomberg New Energy FinancePermitted

Financed

Commissioned


16

20

39

110

151

177

180

221

3

4

7

19

26

31

32

39

Australia

Mexico

Argentina

India

EU-27

Brazil

United States

China

Fuel potential Residue potential

AGRICULTURAL RESIDUE AVAILABILITY, 2030(MILLION DRY TONNES)

Source: Bloomberg New Energy Finance, FAO

17.5% of agricultural

waste in eight regions

could meet 50% of

world gasoline demand


ENERGY EFFICIENCY – L-PRIZE WINNING BULB


180

190

200

210

220

230

240

250

260

2004 2006 2008 2010 2012 2014 2016 2018 2020

Actual annual

energy demand

AUSTRALIA ACTUAL VS FORECASTED ELECTRICITY

DEMAND, 2005–2020 (TWH)

Source: Australian Energy Market Operator, Bloomberg

New Energy Finance

Forecast as of

August 2011

5% shortfall due to

“energy efficiency

and solar”


0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Jan-10 Apr-10 Jul-10 Oct-10 Jan-11 Apr-11 Jul-11 Oct-11 Jan-12 Apr-12

JAPAN‟S NUCLEAR FLEET(% OF REACTORS ONLINE)

Source: ANEA, Bloomberg New Energy Finance

Q1

2010

Q2

2010Q3

2010

Q4

2010

Q1

2011

Q2

2011

Q3

2011

Q4

2011

Q1

2012

Q2

2012

11 MARCH 2011

EARTHQUAKE &

TSUNAMI


Note: Values as of 19 March 2012; NASDAQ and S&P 500 rebased to 100 on 01 Jan 2003

NEX CLEAN ENERGY INDEX 2003 – 2012 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

S&P 500NASDAQNEX


CLEAN ENERGY POLICY


POLICY

STRENGTHENING

96 COUNTRIES

WITH POLICY

SUPPORT

POLICY

WEAKENING


EUROPEAN FINANCIAL CRISIS

Source: Bloomberg


SOLYNDRA

Source: Bloomberg


CASE STUDY - US CAR MANUFACTURERS

1903 2012 Major Manufacturers2015 Major Manufacturers?



67,876 508 124 43

GLOBAL EV CAPACITY, 2011 („000 VEHICLES)


Global auto & light commercial

vehicle production

2011 EV battery

production

capacity

2011 EV

production

capacity

2011 EV

sales


US WIND CAPACITY ADDITIONS, 2008–15(GW)


2.5

5.2

8.4

10.0

4.9

6.7

8.5

3.5

5.0

10.0

2006 2007 2008 2009 2010 2011 2012e 2013e 2014e 2015e

2.5

6.3

9.0

10.2

4.4

7.1

9.5

0.51.5

3

2006 2007 2008 2009 2010 2011 2012e 2013e 2014e 2015e

2.5

5.2

8.4

10.0

4.9

6.7

8.5

3.5

5.0

10.0

2006 2007 2008 2009 2010 2011 2012e 2013e 2014e 2015e

Production tax credit

extended

Production tax credit

NOT extended


TRADE WAR – FIGHT!



THE GOLDEN AGE OF GAS?

Source: Bloomberg


US NATURAL GAS PRODUCTION FORECASTS, 2008–30(TRILLION CUBIC FEET)

Source: EIA, Bloomberg New Energy Finance

0

5

10

15

20

25

30

2005 2010 2015 2020 2025 2030

EIA 2008 forecast

EIA 2012 forecast


776 796

2010 2011

390468

2010 2011Source: EIA, Bloomberg New Energy Finance

US ELECTRICITY GENERATION, 2010–11(TWH)

NATURAL GAS RENEWABLE ENERGY

+20%

+2.5%


HENRY HUB PRICE FORECASTS, 2000-30E ($/MMBTU)


2.48

3.62

5.00

5.85 6.50

7.00

0

1

2

3

4

5

6

7

8

9

10

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012Y

TD

2013e

2014e

2015e

2020e

2030e

Interest expense

G&A

Production taxes

LOE

DD&A

Price

Note: „DD&A‟ is depletion, depreciation and amortisation; „LOE‟ is lease operating expense. 2012

is year-to-date average spot price. 2013 is NYMEX futures price. 2014-2030 is BNEF forecast.


Profit margin on US-Japan LNG Exports

0

2

4

6

8

10

12

14

16

18

20

2007 2008 2009 2010 2011 2012

US AND JAPANESE NATURAL GAS PRICES, 2007–11($/MMBTU)

Natural gas price

0

2

4

6

8

10

12

14

16

18

20

2007 2008 2009 2010 2011 2012

US

Japan

LNG costs

Shipping


US-Japan

price spread

0

2

4

6

8

10

12

14

16

18

20

2007 2008 2009 2010 2011 2012

0

2

4

6

8

10

12

14

16

18

20

2007 2008 2009 2010 2011 2012

0

2

4

6

8

10

12

14

16

18

20

2007 2008 2009 2010 2011 2012

Shipping costs

LNG costs

Profit


0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

18,000

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

"Kim Kardashian"

"Fracking" or "shale gas"

"Electric vehicle"

"Corn ethanol"

"Hydrogen" and "fuel cell"

Source: Bloomberg New Energy Finance, Google

THE SEARCH FOR A SILVER BULLET(GOOGLE NEWS SEARCHES PER YEAR)

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

"Kim Kardashian"


"Electric vehicle"

"Corn ethanol"


0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

"Kim Kardashian"


"Electric vehicle"

"Corn ethanol"


0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

"Corn ethanol"

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

"Electric vehicle"

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000


0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

"Kim Kardashian"


BLOOMBERG NEW ENERGY FINANCE SUMMIT

Are we on track for a

clean energy future?


Renewable energy

Nuclear

Coal Oil

Natural

gas

7,500

5,000

2,500

1,000

Primary energy

GLOBAL PRIMARY ENERGY SUPPLY(MTOE)

Source: Bloomberg New Energy Finance, IEA

Note: The area shows energy consumption, proximity to the axes shows distribution of

consumption. The cross shows centre of the area. The line is the historical trend. Axis

based on square scale. Forecast from IEA.

1970


Renewable energy

Nuclear

Coal Oil

Natural

gas

7,500

5,000

2,500

1,000

Primary energy






2010


Renewable energy

Nuclear

Coal Oil

Natural

gas

7,500

5,000

2,500

1,000

Primary energy

Current policies

450ppm






2035


Renewable energy

Nuclear

Coal Oil

Natural

gas

PRIMARY ENERGY CONSUMPTION PER CAPITA, 2010(TOE PER PERSON)

Source: BP, World Bank, Bloomberg New Energy Finance

Note: Area shows amount of energy consumption, proximity to the axes shows

distribution of energy production. Axis based on a square scale.

5.0

2.5

1.0

US

China

India

Europe

Japan

5.0

2.5

1.0

Japan

Europe

India

China

US

5.0

2.5

1.0

Japan

Europe

India

China

US


Renewable energy

Nuclear

Coal Oil

Natural

gas

PRIMARY ENERGY CONSUMPTION PER GDP, 2010(TOE PER $M)

Source: BP, World Bank, Bloomberg New Energy Finance

Note: Area shows amount of energy consumption, proximity to the axes shows

distribution of energy production. Axis based on a square scale.

400

200

100

25

China

India

US

Europe

Japan

400

200

100

25

Japan

Europe

US

India

China


Renewable energy

Nuclear

Coal Oil

Natural

gas

500

250

100

US – PRIMARY ENERGY SUPPLY(MTOE)




based on square scale. Forecast from IEA New Policies Scenario

1970


Renewable energy

Nuclear

Coal Oil

Natural

gas

500

250

100






2010


Renewable energy

Nuclear

Coal Oil

Natural

gas

500

250

100






2035


Renewable energy

Nuclear

Coal Oil

Natural

gas

200

25

100

GERMANY – PRIMARY ENERGY SUPPLY(MTOE)

Source: IEA, Prognos, EWI, GWS, Bloomberg New Energy

Finance



based on square scale. Forecast based on nuclear phase out scenario.

1970


Renewable energy

Nuclear

Coal Oil

Natural

gas

200

25

100



Finance




2010


Renewable energy

Nuclear

Coal Oil

Natural

gas

200

25

100



Finance




2035


CLEAN VS FOSSIL-BASED GENERATING CAPACITY

GROSS INVESTMENT, 2004–11 ($BN)

Source: IEA, EIA, Bloomberg New Energy Finance

Note: Investment for new build – fossil fuel calculated from EIA & IEA numbers, clean energy taken from

Bloomberg New Energy Finance totals. Clean energy capacity includes small distributed capacity.

Fossil fuel

Clean energy

0

50

100

150

200

250

300

350

2004 2005 2006 2007 2008 2009 2010 2011


CAPITAL REQUIREMENT TO 2030: $BN

0

100

200

300

400

500

600

700

Source: NEF Global Futures 2008

2004 2006 2008 2010 2012 2014 2016 2018 2020 2022 2024 2026 2028 2030


TOTAL ENERGY SUBSIDIES, 2010($BN)

Source: IEA, Bloomberg New Energy Finance

RENEWABLE

ENERGYFOSSIL FUELS

$409bn$66bn


0 50 100 150 200 250 300 350 400 450 500 550

Coal Fired

Natural Gas CCGT - US

Natural Gas CCGT - Europe

Natural Gas CCGT - Japan

Landfill Gas

Geothermal - Flash Plant

Wind - Onshore

Geothermal - Binary Plant

Municipal Solid Waste

Biomass - Incineration

Biomass - Anaerobic Digestion

Biomass - Gasification

PV - c-Si Tracking

PV - Thin Film

PV - c-Si

STEG - Tower & Heliostat w/storage

Wind - Offshore

STEG - Tower & Heliostat

STEG - Parabolic Trough + Storage

STEG - LFR

STEG - Parabolic Trough

Marine - Tidal

Marine - Wave

LCOE BNEF 2011 EU-ETS EUA Forecast

-

LEVELISED COST OF ENERGY Q4 2011 ($/MWH)

Carbon from the BNEF European Carbon Model with an average price of $36/tCO2 to 2020, driven by the rising cost of abatement (largely due to less cheap fuel-switching

potential) in Phase IV. Coal and natural gas capex from the US Department of Energy EIA Annual Energy Outlook 2011. US gas: Henry Hub, Japanese: imported LNG, EU:

German/UK gas. Health costs from the New York Academy of Sciences 1219: 73-98 “Full cost accounting for the life cycle of coal”

Fossil fuelledFossil fuelled w/CO2 Competitive clean energy Health costsBNEF 2011 EUA forecast


STRAIT OF HORMUZ

IranIraq

Saudi

Arabia

India

Pakistan

AfganistanSyria

Jordan

YemenOman

Source: EIA, Bloomberg New Energy Finance


US defensebudget

Persian Gulfoil security

611 83

US DEFENSE BUDGET, 2009($BN)

Source: The Rand Corporation, EIA,

Bloomberg New Energy Finance

Note: Analysis uses higher of two scenario. In low scenario, Persian Gulf oil security costs $67.5bn.

Assumes an equal proportion of imported and domestic oil is refined into gasoline.

$0.26 for

every gallon

of gasoline

sold in US

= OR

$0.43 for

every gallon

of imported

gasoline


0

100

200

300

400

500

600

700

800

900

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

Mining

Electric utilities

Oil and gas

Clean energy

LOBBYING EXPENDITURE, 2000–11 ($M)

Source: Center for Responsive Politics,

Bloomberg New Energy Finance

0

50

100

150

200

250

300

350

400

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

Mining

Electric utilities

Oil and gas

Clean energy


SEVEN POINT PLAN

1. Messaging – clean energy: affordability not subsidies

2. Messaging – economy: productivity, security & health not “Green Jobs”

3. Messaging – policy: deregulation not regulation

4. Alliances: reach out to other sectors

5. Audience: stop preaching to the converted

6. Media: own the airwaves, own the politicians

7. And… support Sustainable Energy for All


"Sustainable energy can

revitalize our economies,

strengthen social equity,

and catalyse a clean energy

revolution that benefits all

humanity."

UN Secretary-General Ban Ki-Moon

2012: International Year of Sustainable Energy for All


THANK YOU!

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FINANCEMICHAEL LIEBREICH

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