alternativenergy

New frontiers for alternative energy

Reid Buckley, Vice-President, BP Alternative Energy

alternativenergy

Energy demand 2005-2030

10

12

14

16

18

20

2005 2015 2030

Reference

Alternative

Billion tonnes oil equivalent

- Reference scenario represents ‘business-as-usual’- Alternative scenario assumes all climate change and energy security policies now being considered by governments are adopted

Source: IEA World Economic Outlook 2007

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CO2 emissions 2005-2030

20

30

40

50

2005 2015 2030

Reference

Alternative

2°C scenario

Billion tonnes CO2

Reference scenario represents ‘business-as-usual’

2°C scenario shows IEA calculation of path needed to prevent temperatures rising 2°C over pre-industrial levels

Alternative scenario assumes all climate change and energy security policies now being considered by governments are adopted

Source: IEA World Economic Outlook 2007

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Energy drivers

Demand

High energy prices

Energy security

Climate change

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Energy criteria

Availability

AffordabilityReliability

Sustainability

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Alternative energy

Low-or-no carbon

Plentiful

Secure

Increasingly attractive economically

“I’d put my money on the sun and solar energy. What a source of power! I hope we don’t have to wait until oil and coal run out before we tackle that.” Thomas Edison, 1931

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Policy support for alternative energy

Policy targets in 66 countries

Feed-in tariffs in 37 countries

Mandates for biofuels in 17 countries

Source: Ren21 Global Status Report 2007, Renewable Energy Policy Network

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Alternative energy: the market today

Demand growth p.a. since 2001

Sources: Primary energy based on IEA WEO reference scenario. Renewables based on New Energy Finance

0

10

20

30

40

Total PrimaryEnergy

Wind Solar Biofuels

%

Global new investment in clean energy

Grossed-up estimate based on disclosed deals. New investment only. Source: New Energy Finance

2007

60%

Growth

58%

Growth

91%

Growth

0

25

50

75

100

125

$28.6bn

2004

$54.6bn

2005

$86.5bn

2006

$148.4bn

$b

n

150

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Alternative energy: the market today

Demand growth p.a. since 2001

Sources: Primary energy based on IEA WEO reference scenario. Renewables based on New Energy Finance

0

10

20

30

40

Total PrimaryEnergy

Wind Solar Biofuels

%

Global new investment in clean energy

Grossed-up estimate based on disclosed deals. New investment only. Source: New Energy Finance

2007

60%

Growth

58%

Growth

91%

Growth

0

25

50

75

100

125

$28.6bn

2004

$54.6bn

2005

$86.5bn

2006

$148.4bn

$b

n

150

Jobs in renewable energy –

2,400,000

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Proportions of world energy today

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0

2

4

6

8

10

12

14

16

18

2002 2007 2013 2018 2023

US wind capacity - beating the projections

EIA projection from 2004

GWActual capacity end-2007

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BP Alternative Energy

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BP Alternative Energy: a growing global business

Investing $1.5bn in 2008 – as much as in previous two years combined

Solar PV facility / market

Wind power

Hydrogen power

Biofuels facility / market

Gas fired power

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BP Alternative Energy: solar power

• 30 years’ experience, 20 offices, 2000+ employees, installations in 160 countries.

• Manufacturing facilities in Frederick US, Bangalore, Madrid, Xian and Sydney.

• Expecting to grow 60%+ by 2012. • Expanding production to achieve

target sales of around 800MW with similar levels of production by 2010

• Includes $97m expansion at Frederick – largest integrated solar manufacturing plant in US

• Advanced Mono² process; support for research projects

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BP Alternative Energy: wind power

0

1000

2000

3000

2005 end 2008 end 2010

MW

30 MW

1GW

3GW

Expected installed gross capacity

US land portfolio with potential for 15GW

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BP Alternative Energy: wind power

Built:

• Colorado: Cedar Creek wind farm with partner Babcock & Brown – 300MW

• Dhule, India - project built with partner Suzlon – 40MW

• Netherlands: Two farms – total 30MW

Under construction:

• Indiana: Fowler Ridge wind farm with Dominion – Phase I - 400MW

• Texas: Silver Star project with Clipper - 60MW; Sherbino project with NRG Energy - 150MW

• Kansas: Flat Ridge farm with Westar Energy - 100MW

• California – re-powering Edom Hills – 20MW

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BP Alternative Energy: biofuels

• Producing ‘good’ biofuels – which reduce emissions and enhance security without damaging habitats and forests

• $1bn investment in Brazilian ethanol – made from sustainable sugar-cane - the most efficient feedstock currently available - greenhouse gas emissions reductions of up to 80%

• Working with DuPont to demonstrate biobutanol

• Investing $500 million over 10 years in the Energy Biosciences Institute to explore advanced biofuels and other applications of biotech to energy

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BP Alternative Energy: hydrogen energy

Concept for Abu Dhabi power

station

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New policies on alternative energy

Climate high on agenda for G8 and UN

Climate summit in Copenhagen December 2009

Carbon price of up to $60 projected by 2012*

National legislation or proposals underway in many countries

*Source: New Energy Finance

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Alternative energy: future market drivers

Demand growth p.a. 2005-2030E

%

0

5

10

15

20

25

Total PrimaryEnergy

Wind Solar Biofuels

Sources: Primary energy based on IEA WEO 2007 reference scenario. Renewables based on New Energy Finance

Source: New Energy Finance, Nov 2007

Global new investment in 2030 - Clean Tech forecast

0

1000

2000

3000

2007 2030$

bn

$148bn

$2-3trn

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Solar potential – Central America

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Wind potential – Central America

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New frontiers for alternative energy

Reid Buckley, Vice-President, BP Alternative Energy