Outlook for Renewable Energy from an Asian Perspective
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Outlook for Renewable Energy from an Asian Perspective Asia Clean Energy Forum 2016 ADB, Manila, 9 June 2016 Douglas-Westwood Singapore Jason Waldie, Assoc Director
Transcript of Outlook for Renewable Energy from an Asian Perspective
Outlook for Renewable Energy
from an Asian Perspective
Asia Clean Energy Forum 2016
ADB, Manila, 9 June 2016
Douglas-Westwood Singapore
Jason Waldie, Assoc Director
Renewable Energy: Global
• 2015 was a peak year to date for investment in renewable energy
generation with over $2.3 billion investment globally on new capacity
additions - outpacing conventional fossil fuel and nuclear.
• Over the next twenty years, an anticipated $6.1 billion will be spent
at a Compound Annual Growth Rate (CAGR) of 2.8% as the global
industry adds an additional 4,200GW of renewable capacity.
0
50
100
150
200
250
2015 2020 2025 2030 2035
Solar
Onshore Wind
SolarOther
Global Power Generation
Supply Mix (TWh)
Global Investment on
Renewable Capacity ($Billion)
0
2,000
4,000
6,000
8,000
10,000
12,000
14,000
16,000
2015 2020 2025 2030 2035
Coal
Renewables
Natural Gas
NuclearOil
Renewable Energy: Global
Reducing Levelized Cost of Electricity (LCOE) for Solar and Onshore Wind
Solar – LCOE has fallen by 50% over the past 5 years
• Improved economies of scale in the manufacturing industry
• Falling price of polysilicon which is a primary component of solar panels
• Improved solar panel performance
Onshore wind - LCOE has fallen by 13% over the past 5 years
• Improved efficiency
• Increasing turbine size
115
92
7971
65
8174
6964 61
77 78 80 8388
6569
7581
87
2015 2020 2025 2030 2035
Solar PV Onshore wind Natural gas Coal
(US$/MWh)
115
92
7971
65
8174
6964 61
77 78 80 8388
6569
7581
87
2015 2020 2025 2030 2035
Solar PV Onshore wind Natural gas Coal
(US$/MWh)
Renewable Energy: Asia
Growth of Energy Demand
0
100
200
300
400
500
600
700
2015 2020 2025 2030 2035
Global Vs Asia Investment on
Renewable Capacity ($Billion)
0
100
200
300
400
500
600
700
2015 2020 2025 2030 2035
Asia
Global
28% 41% 45% 47%
72% 59% 55% 53%
2000 2015 2025 2035
Asia-Pacific Rest of the World
(%)
Primary Energy Demand by Region
•Principal drivers for increased adoption of renewable energy
at a global level are the increasing focus of governments on
mitigating “security of supply” risk associated with fossil fuels
Renewable Energy: Asia
The Asian market currently accounts for 41% of global
energy demand and 45% of global power generation
Asian Renewable Spend by
Geography
Asian Renewable Spend
($Billion)
•Renewable sources account for 8% of regional energy
consumption with this share expected to increase to 14%
by 2035
0
50
100
150
200
250
2015 2020 2025 2030 2035
0%
10%
20%
30%
40%
50%
60%
2015 2020 2025 2030 2035
Solar
Onshore Wind
Hydro Offshore Wind
Biomass
0%
10%
20%
30%
40%
50%
60%
70%
80%
2015 2020 2025 2030 2035
China
India
SE Asia
Asian Renewable Spend by
Sector
Renewable Energy: Asia - Philippines
Highly embryonic renewables market, current installed
capacity stands at 4.5GW
Current Philippines Generating Capacity
Breakout- *Independent Power Producer Philippines Investment on Renewable
Capacity ($Billion)
• Geothermal and hydro already feature prominently in the country’s energy
supply mix. However, significant future investment in solar PV and onshore
wind is expected to be announced when the government releases its
Philippine Energy Plan (PEP) later this year.
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1
2
3
4
5
6
7
2015 2020 2025 2030 2035
Solar
Other
Onshore
WindIPP
100%
EGAT42%
IPP35%
SPP12%
VSPP5%
Imports6%
Renewable Energy: Asia - Thailand
Aims at establishing an Energy-Sufficient Society and promoting Renewables
Growth
Current Thailand Generating
Capacity Breakout * EGAT - State
Utility
Thailand Investment on Renewable
Capacity ($Billion)
• Thailand’s most recent Power Development Plan (PDP) calls on an increase in
renewable contribution to the nation’s power generation mix from 15% to a range
between 30% and 40% by 2036. Solar PV and wind are expected to account for the
majority of incremental renewable capacity.
Independent Power Producer (IPP); Small Power Producer (SPP); Very Small Power Producer
(VSPP);
0
1
2
3
4
5
6
7
8
9
2015 2020 2025 2030 2035
Solar
Other
Onshore
Wind
Central26%
State34%
IPP40%
0
5
10
15
20
25
30
2015 2020 2025 2030 2035
SolarOther
Onshore
Wind
Renewable Energy: Asia - India
Recent years have increased focus on renewables as part of the
future energy supply
Current India Generating
Capacity Breakout
India Investment on
Renewable Capacity ($Billion)
• Policy mechanisms introduced in 2009 were highly successful in kickstarting
the solar PV and wind industries and the country is now transitioning to a
more standard FiT scheme providing potential investors with longer-term
stability at the expense of short term profitability
0.0
0.2
0.4
0.6
0.8
1.0
1.2
1.4
2015 2020 2025 2030 2035
Solar
Onshore Wind
Other
Renewable Energy: Asia - Indonesia
Recent years have increased focus on renewables as part of the
future energy supply
Indonesia Investment
on Renewable Capacity
($Billion)
• The majority of renewable investment is expected to come from
biomass and hydro with onshore wind and solar PV expected to
account for 21% and 23% respectively.
0
50
100
150
200
250
300
350
400
450
2015 2020 2025 2030 2035
Energy Demand (mtoe)
Power Consumption
(TWh)
CAGR 3.9%
CAGR 2.9%
Indonesia Energy &
Power Demand
Projections
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50
100
150
200
250
300
350
2015 2020 2025 2030 2035
Energy Demand (mtoe)
Power Consumption
(TWh)
CAGR 1.1%
CAGR 0.5%
0.0
0.2
0.4
0.6
0.8
1.0
1.2
2015 2020 2025 2030 2035
Solar
Onshore Wind
Renewable Energy: Asia - Taiwan
Taiwanese energy sector is expected to undergo a significant
transformation - reduce coal and nuclear power
Taiwan Investment on
Renewable Capacity
($Billion)
•Government plans to make Taiwan nuclear free by 2025
is expected to see significant investment in new
renewable capacity over the next 20 years
Taiwan Energy & Power
Demand Projections
Renewable Energy: Offshore wind
Renewable Energy: Offshore wind
Renewable Energy: Onshore/ Offshore Asia
Key Risks
• Regulatory & Policy Risk
Potential changes to energy policy and regulation at national levels.
• Intermittency & Resource Risk
Unexpected changes in weather can have a significant impact on outputs and
subsequent revenues.
• Connectivity & Infrastructure
In most markets, suppliers must seek a grid connection permit as well as a generation
license and may need to submit supply estimates to local regulators
• Off-Taker
Potential for counterparties to renege on PPA obligations due to bankruptcy or other
force majeure still presents a threat.
Renewable Energy: - Conclusions
• 2015 was a peak year to date for investment in renewable energy generation with
over $2,298 billion investment globally on new capacity additions - outpacing
conventional fossil fuel and nuclear.
• Solar – LCOE has fallen by 50% over the past 5 years
• Onshore wind - LCOE has fallen by 13% over the past 5 years
• The Asian market currently accounts for 41% of global energy demand and 45% of
global power generation
• Renewable sources account for 8% of regional energy consumption with this share
expected to increase to 14% by 2035
• Key risks: Regulatory & Policy; Intermittency & Resource Risk; Connectivity &
Infrastructure; Off-Taker
• Offshore wind: less of a focus in Asia in comparison to Europe but China and Korea
are looking like the leaders in years to come
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11/03/2015
Thank you
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