BPMR BPMR Mission Korea BPMR BPMR Mission Korea Mission Korea - - PowerPoint PPT Presentation

BPMR BPMR BPMR BPMR Mission Korea Mission Korea Mission Korea Mission Korea Industry Industry Industry Industry to Industry Dialogue on Emissions to Industry Dialogue on Emissions to Industry Dialogue on Emissions to Industry Dialogue on Emissions Trading and Market Readiness Trading and Market Readiness Trading and Market Readiness Trading and Market Readiness Experience Experience Experience Experience sharing on broader issues dealing sharing on broader issues dealing sharing on broader issues dealing sharing on broader issues dealing with EU ETS and overlapping with EU ETS and overlapping with EU ETS and overlapping with EU ETS and overlapping policies policies policies policies

Giles Dickson, Giles Dickson, Giles Dickson, Giles Dickson, Vice

Vice Vice Vice President President President President Environment Environment Environment Environment Policies Policies Policies Policies & Global & Global & Global & Global

Giles Dickson, Giles Dickson, Giles Dickson, Giles Dickson, Vice

Vice Vice Vice President President President President Environment Environment Environment Environment Policies Policies Policies Policies & Global & Global & Global & Global Advcocacy Advcocacy Advcocacy Advcocacy, Alstom , Alstom , Alstom , Alstom 27 September 2013, Seoul 27 September 2013, Seoul 27 September 2013, Seoul 27 September 2013, Seoul

Equipment & services for power generation Alstom Thermal Power Alstom Thermal Power Alstom Thermal Power Alstom Thermal Power Equipment & services for power transmission Alstom Alstom Alstom Alstom Grid Grid Grid Grid

Alstom = Alstom = Alstom = Alstom = low low low low-

• carbon

carbon carbon carbon infrastructure infrastructure infrastructure infrastructure

Equipment & services for rail transport Alstom Transport Alstom Transport Alstom Transport Alstom Transport Alstom Renewable Power Alstom Renewable Power Alstom Renewable Power Alstom Renewable Power

EU ETS + EU ETS + EU ETS + EU ETS + Renewables Renewables Renewables Renewables + + + + Energy Energy Energy Energy Efficiency Efficiency Efficiency Efficiency

• EU ETS: 45% of EU emissions: reduce 21% 2005- 20
• Renewables:

long list ….

Measure Measure Measure Measure Covers Covers Covers Covers which which which which sectors sectors sectors sectors Target Target Target Target EU ETS EU ETS EU ETS EU ETS Power and industry: 45%

• f EU emissions

Reduce emissions by 21% by 2020 compared to 2005 BINDING

Presentation title - 01/01/2007 - P 3

BINDING Renewables Renewables Renewables Renewables Power and transport Renewables to be 20% of energy consumption by 2020 BINDING Energy Energy Energy Energy Efficiency Efficiency Efficiency Efficiency Whole economy Improve by 20% by 2020

• vs. business as usual

NON- BINDING

…. …. …. …. a a a and there are other policies nd there are other policies nd there are other policies nd there are other policies

• Greenhouse

Greenhouse Greenhouse Greenhouse Gas Gas Gas Gas « « « « Effort Effort Effort Effort-

• Sharing

Sharing Sharing Sharing » » » »

• 10% target to reducing for the other 55% of emissions by 2020
• n 2005 levels
• broken down by 27 binding national targets
• Fuel

Fuel Fuel Fuel Quality Quality Quality Quality

• 6% target for reducing GHG emissions from fuels by 2020 on
• 6% target for reducing GHG emissions from fuels by 2020 on

2010 levels

• Vehicle CO2 Standards

Vehicle CO2 Standards Vehicle CO2 Standards Vehicle CO2 Standards

• cars: 130g/km by 2015 and 95g/km by 2020
• vans: 175g/km by 2017 and 147g/km by 2020.
• Eco

Eco Eco Eco-

• Labelling

Labelling Labelling Labelling rules rules rules rules: promotes products with low carbon footprint

• Eco

Eco Eco Eco-

• Design

Design Design Design standards standards standards standards: on environmental performance of energy related products

• Energy

Energy Energy Energy Taxes Taxes Taxes Taxes: minimum rates for energy taxes in heating electricty and motor fuel

Presentation title - 01/01/2007 - P 4

Overall progress “good”: meeting CO2 target …. Overall progress “good”: meeting CO2 target …. Overall progress “good”: meeting CO2 target …. Overall progress “good”: meeting CO2 target ….

1990- 2011: EU GDP

up 48%, emissions down 18.5%

5,000,000 5,500,000 6,000,000

CO2 x,000 tonnes

Close to 20% target

for 2020

3,000,000 3,500,000 4,000,000 4,500,000 1990 1995 2000 2005 2010 2015 2020 Actual GHG emissions 20% target path 30% target path

State of play: ETS

Good Good Good Good

• will deliver 21% emissions reductions in sectors covered

Progress on EU ETS ? Progress on EU ETS ? Progress on EU ETS ? Progress on EU ETS ?

Not Not Not Not so so so so good good good good

• price not driving investments
• low auction revenues

5 10 15 20 25 30 35 févr 2007 juil 2007 déc 2007 mai 2008

• ct 2008

mars 2009 août 2009 janv 2010 juin 2010 nov 2010 avr 2011 sept 2011 févr 2012 Price in Euro Dec-12 EUAs Dec-12 CERs

Good Good Good Good

• good progress towards targets (see next slide)
• important contribution to emission reductions
• technology costs down, especially in PV and onshore

State of play: Renewable energy Progress on Progress on Progress on Progress on Renewables Renewables Renewables Renewables ? ? ? ?

wind Not Not Not Not so so so so good good good good

• high cost of support schemes not politically sustainable

€ 23bn pa in Germany; € 10bn pa in Italy

• successful industrial policy ?
• market/grid integration challenges remain

Progress on Progress on Progress on Progress on Renewables Renewables Renewables Renewables …. …. …. ….

State of play: Energy Efficiency

Good Good Good Good

• vehicle CO2 standards will be met
• new energy efficiency standards and labelling adopted for lighting and

appliances

Progress on Progress on Progress on Progress on Energy Energy Energy Energy Efficiency Efficiency Efficiency Efficiency ? ? ? ?

• recent adoption of Energy Efficiency Directive

Energy Efficiency Directive Energy Efficiency Directive Energy Efficiency Directive (October 2012)

Not so good Not so good Not so good Not so good

• EU unlikely to meet 20% energy efficiency target for 2020
• more finance needed, especially for the renovation of buildings
• more progress needed in overall transport energy efficiency

Interaction of ETS Interaction of ETS Interaction of ETS Interaction of ETS with with with with Renewables Renewables Renewables Renewables and and and and Energy Energy Energy Energy Efficiency Efficiency Efficiency Efficiency

• CO2

CO2 CO2 CO2 price price price price not not not not high high high high enough enough enough enough to drive investments in either

• Renewables

Renewables Renewables Renewables have relied more on national support schemes: feed feed feed feed-

• in

in in in tariffs tariffs tariffs tariffs and green/white certificates

• Energy

Energy Energy Energy efficiency efficiency efficiency efficiency improvements have relied on regulation regulation regulation regulation, e.g. on cars and appliances

• ETS cap

ETS cap ETS cap ETS cap failed to take full account of progress in renewables deployment and energy efficiency: − this has contributed to current surplus of allowances

Presentation title - 01/01/2007 - P 10

What’s actually happening out there ….. What’s actually happening out there ….. What’s actually happening out there ….. What’s actually happening out there …..

10 15 20 25 30 35

ECX EUA Dec Ahead ECX CER Dec Ahead

Phase 1 Phase 1 Phase 1 Phase 1 Phase 2 Phase 2 Phase 2 Phase 2

5 janv.-05 janv.-06 janv.-07 janv.-08 janv.-09 janv.-10 janv.-11 janv.-12 janv.-13

Increased interest in Increased interest in Increased interest in Increased interest in renewables and gas renewables and gas renewables and gas renewables and gas Increased interest in Increased interest in Increased interest in Increased interest in CCS CCS CCS CCS Fuel switching from Fuel switching from Fuel switching from Fuel switching from gas to coal gas to coal gas to coal gas to coal

1 1 1 1 2 2 2 2 3 3 3 3

EU CO2 EU CO2 EU CO2 EU CO2 price price price price now now now now well well well well below below below below international international international international norm norm norm norm

Quebec Alberta EU (Phase 2 prices) Australia (pre-EU linkage) British Colombia 5 10 15 20 25 30 RGGI Australia (with linkage) EU Shenzhen South Africa California $/tonne

… and investments insufficient … and investments insufficient … and investments insufficient … and investments insufficient

$140 $140 $140 $140 billion billion billion billion

Clean energy Clean energy Clean energy Clean energy investments investments investments investments $ $ $ $bn bn bn bn 58.6 64.4 45.1

2013 2013 2013 2013-

• 2020

2020 2020 2020

Source: Bloomberg New Energy Finance, UNEP, SEFI

2010 2011 2012

Lessons Lessons Lessons Lessons learned learned learned learned from from from from EU EU EU EU policies policies policies policies

• ETS

ETS ETS ETS needs needs needs needs scarcity scarcity scarcity scarcity of

• f
• f
• f allowances

allowances allowances allowances to to to to give give give give price price price price signal for signal for signal for signal for investments investments investments investments

• This

This This This will will will will reduce reduce reduce reduce dependence dependence dependence dependence on

• n
• n
• n renewables

renewables renewables renewables support support support support schemes schemes schemes schemes

• ETS

ETS ETS ETS need need need need to to to to be be be be co co co co-

• ordinated
• rdinated
• rdinated
• rdinated with

with with with other

• ther
• ther
• ther policies

policies policies policies. . . .

• ETS cap

ETS cap ETS cap ETS cap needs needs needs needs to factor in to factor in to factor in to factor in expected expected expected expected progress progress progress progress in in in in renewables renewables renewables renewables and EE and EE and EE and EE

• ETS cap

ETS cap ETS cap ETS cap needs needs needs needs to factor in to factor in to factor in to factor in expected expected expected expected progress progress progress progress in in in in renewables renewables renewables renewables and EE and EE and EE and EE

• ETS cap

ETS cap ETS cap ETS cap should should should should be be be be flexible flexible flexible flexible enough enough enough enough to to to to respond respond respond respond to variations in to variations in to variations in to variations in demand demand demand demand

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