Transcript Performance of Generating Plant

GLOBAL & REGIONAL KEY ENERGY
ISSUES:HOW TO FACE THEM
- Slav Slavov WEC Regional Coordinator for Europe &
Central Asia
Current Process Status:
Driving Forces
• Goals, targets &commitments as defined by:
- Agenda 21;and PFIA21
- UN CSD, 9th session, April 2001
-
Johannesburg Plan of Implementation (JPOI)
- UNCSD-14 (April 2006): SG report on progress
ENERGY: GLOBAL ISSUES
• Access to energy for poverty alleviation
• Integrating of energy for SD into national policies
• Support efforts to improve functioning of markets
• Encourage PPP, to give impetus to energy for SD goals
• Strengthen the role of major groups in policy making
• Promote increased R & D in varies technologies
SUSTAINABILITY: THE REGIONAL
DIMENSION
• Regions face different priority challenges:
For example:
- Access to energy for poverty alleviation (poor countries)
- Reducing CO2 emissions (developed countries only)
- Internalisation of external costs (western Europe)
- Technology transfer (developing countries)
• Conclusion: (1) Developed countries-environment &
security ;(2) developing countries- economy & social
development.
Key Energy Issues
 Enhance security of supplies and reduce
further dependency on oil;
 Pursue market reforms in energy sector
while secure reliability of electricity
markets;
 Enhance energy efficiency in both, supply
and demand sides, with particular
emphasis on C/E Europe.
Key Energy Issues
 Preserve environment & climate by:
- promoting inter alea Kyoto mechanisms;
- promoting market for renewables;
- enhancing R & D on nuclear, oil
substitution & CO2 sequestration;
- harmonization of energy tax systems;
WEC AND SUSTAINABLITY
• WEC contribution to this global process:
-
World Energy Assessment Study;
-
WEC Global & Regional Studies and Scenarios;
WEC 19th Congress, Sydney, September 2004:
Delivering sustainability: Challenges & Opportunity
for the Energy Industry
19th World Energy Congress,
Sydney 2004
Main conclusion:
Delivering sustainability to energy sector should be a
priority objective. It is achievable but..... challenges are
many; and they must be tackled now and urgently if
sustainability is to be achieved in this century.
SECURITY OF ENERGY SUPPLIES
• WEC`position on security - AAA
•
WEC`Recommendation: Keep all the options open
as
diversity is the backbone of a robust, less vulnerable
energy system, even if the optimum mix would vary
according to the local conditions.
SELECTED KEY ISSUES
• Security of supplies in liberalised
markets;Europe`s vulnerability;
• Energy Intensity and Energy
Efficiency.
What future evolution?
THE TWO POSSIBLE
ENERGY WORLDS
• Definition of a “CONCAVE” energy trajectory:
All published scenarios, e.g. WEC-IIASA, shape an
accelerating energy demand over time in which
“Acceptability” is the binding constraint
• Definition of a “CONVEX” energy trajectory: Still
unexplored domain of decelerating energy evolution in
which “Availability”, “Accessibility” and
“Acceptability” are all binding constraints
SECURITY OF SUPPLIES (1)
- the risks• Energy fundamentals revert back to 1970s/1980s crises:
- volatility of oil prices;
- continuous growing import dependency;
- growing reliance on one supplier-Middle East;
• But under different conditions:
- today oil is used in transport sector only;
- oil share in Europe`s energy market is less than 10%;
- price increases dictated by the market imbalance;
SECURITY OF SUPPLIES (2)
- the risks• Investment risks & uncertainties persist, as:
- full implications of market liberalization unclear;
- impact of market opening on contracts (take or pay ?);
- longer supply routes and fear of terrorism;
and recent doubts:
- oil reached the peak, no spare capacity;
- oil & gas might face geological constraints ???
- price escalation of hydrocarbons;
WHAT PROSPECTS FOR OIL
•
Peak of the non-Middle-East production reached;
• Maturity of OPEC Middle –East seems also reached.
NON-ME OIL AND
TECHNOLOGY
NON MIDDLE-EAST OIL PRODUCTION (MB/D)
70
Sour c es : P E T RODA T A & I E A
A nnual d ecl i ne
> 1 M b / d ay
60
50
40
Unc er t ai nt y
Deepwat er
30
FSU
Ot her s non M E
20
19 8 5
19 9 0
19 9 5
2000
2005
2 0 10
2 0 15
2020
FUTURE OIL
BALANCE?
5
4
OPEC Middle-East
Rest of the World
Gt/y
3
2
1
0
1940 1945 1950 1955 1960 1965 1970 1975 1980 1985 1990 1995 2000 2005 2010 2015 2020 2025 2030
OIL DEPENDENCY ON MIDLE EAST
• 2/3 European oil imports from ME in 2025-2030;
• at average, the OPEC- ME fields are 50 years old;
• they might produce for many years, but:
like Marathonians (unlike sprinters)
• Recent studies (Matt Simmons) show Saudi Arabia
could already be mature (confirmation of Hubert
curve); and ambiguity about Kuwait reserves;
• Current role of OPEC
THE 1973 SHOCK…
US OIL PRODUCTION 1900-2000
BILLIONS BARRELS PER YEAR
4
3
A growing gap that
OPEC could not fill
2
1
0
1900
1920
1940
1960
1980
2000
WHAT PROSPECTS FOR NATURAL GAS
•
Production peak reached in OECD regions;
• Production rise elsewhere with the LNG boom;
• Higher price would limit consumption:tendency to use
it in residential & commercial markets only.
OECD HAS PEAKED
NORTH AMERICAN
GAS PRODUCTION…
RUSSIAN GAS
RUSSIAN GAS
Siberia
DEPENDENCY ON RUSSIAN OIL & GAS
•
Europe depends 40% of Russia on gas and 25% on oil;
• Russian reserves move far way from Europe and close
to the Asian markets;
• Asian markets are more attractive than Europeans;
• Gazprom seek partners and distribution markets;
• Russia may continue to be a reliable supplier.
WHAT PROSPECTS FOR COAL
•
Increased use of coal for CTL and power generation;
• Risk of limited use in power generation exist if:
- energy efficiency in combustion stay low;
- CO2 sequestration technology stay late, behind 2020.
Coal reserves are abundant!
kb/d
2005 IEA VIEW OF
WORLD CTL & GTL
WHAT PROSPECTS FOR NUCLEAR
UNCLEAR?
but
getting more place in the Energy Agenda
Reforms in elmarket should`n
conflict with security
Adequacy and Reliability are the backbone of a modern
power system;
 Costumers and economy need 100 percent reliability;
 Disruptions caused by ``brownouts`` and `` blackouts``
imply substantive costs to economy and households;
 A clear ``trade off`` between operators and regulators;
 Sharing responsibility for securing supplies in a
liberalised market.
SECURITY OF SUPPLIES
- Conclusions on Fuel Imports • Scarcity of resources create supply imbalance and call for large
price increases.
• The current and future oil price volatility will affect GDP severely,
future economic recessions might be worst than previous.
• Oil price volatility lead to price increases in other fuels, but mostly
of gas, making it less competitive.
• Current policy and market tools do not support investments
neither in upstream nor in energy infrastructure.
• Europe becomes more dependent on imports and vulnerable in
infrastructure;
• Energy crisis lower GDP growth and energy intensity.
World Energy Intensity
1.1
1973
The world energy intensity
was constant (set to 1,0)
before the first oil shock
and declines after
1.0
0.9
0.8
0.7
0.6
0.5
0.4
1960
1965
1970
1975
1980
1985
1990
1995
2000
2005
2010
2015
2020
2025
SECURITY OF SUPPLIES
- Conclusions on Fuel Competition• Oil price increases affects differently other sources:
• fossil fuels
might reduce gas market share; boost coal use and non
traditional (synthetic liquids, coal gasification);
- speed up R &D on hydrogen and CO2 sequestration;
• nuclear:
re-consideration of policies; speed up R &D on
technology & waste storage;increase the market share;
• RES: Increasing the share to the possible extend;
• efficiency: Ease investments for further improvements
SECURITY OF SUPPLIY
- Conclusions on internal market• LIBER shifted responsibility to market, but barriers
still exist to become fully competitive;
• LIBER confirmed a higher level of energy service, and
management, perhaps lower costs (?) but not lower
prices. Some disadvantages:
•
•
•
•
The market remain national;
The role of stakeholders not well defined;
Uncertainty about security of supply (disruption);
Reserve capacities declined, in generation and
interconnections, investments are rather cyclical.
What is needed to enhance security
of oil & gas supplies
-
re-defining policies, in view of recent circumstances;
assess & increase if needed, by regulations the
emergency stocks, in particular that of natural gas;
encourage diversification of supplies & accelerate
development of strategic projects (Nabuko?);
ensure conditions & support partnerships with
upstream supply companies (Gazprom?);
encourage a regular dialogue (on policy & company
level) with suppliers and neighbouring ``energy
corridors``countries.
What is needed to enhance security
in electricity market
• First, more transparency and harmonization is needed;
• Markets require some new policy instruments (costeffective) to manage risks and cover costs of disruption;
(Re-consideration of the Directive ?)
• The market should be more encouraged to invest in
security: reliability contracts and reserve capacity could
be effective market instruments, for ensuring adequacy
and reliability of market operation;
What is needed to reduce
EURO-dependency on import
-
Main directions formulated in the ECnew Green Paper;
among which:
-
-
policy of fuels substitution; increase the share of RES
by policy and market tools (Renewable Energy Road
Map);
enhance EE in energy supply & demand, in particular
in the new members (with 20%by2020).
launch a public debate on nuclear;
Finance R & D in CO2 sequestration & nuclear.
SECURITY OF SUPPLIY
- WEC-Europe contribution• WEC is carrying out two regional studies, namely:
1. Vulnerability of Europe to Energy Crises; and
2. Future of Nuclear power in Europe.
• WEC & EC cooperate on this issue:annual seminars.
• Joint EC-WEC Seminar on Security of Supplies
(Brussels, Friday 30 June 2006)
under the chairmanship
of
EC Commissioner: Mr. Andris Piebalgs;
and
WEC-Vice Chair Europe: Mr. Pierre Gadonneix
Global Energy Information
Service