Recent events are impacting the energy markets with the present and future energy mix is evolving. These raise serious sustainability questions and puts the case forward for smart grids
Presentation hold on May 12, 2012 by Colette Lewiner
2. An overview of the European energy markets
Recent events are impacting the energy markets
• Middle-East political tensions
• Fukushima accident consequences
• Economic downturn
Present and future energy mix is evolving
• Renewables
• Gas
• Energy mix costs
Sustainability questions
• EU 2020 objectives
• Demand Response
Smart grids
Conclusion
| Energy, Utilities & Chemicals Global Sector
2
3. The rising political tensions in Iran are particularly worrying
for global oil supply
Italy
After China, the EU is the largest importer of Iranian oil Iran’s oil exports (Jan to June 2011)
(about 20%) % of each 13%
In response to the Iran’s nuclear program negotiations country’s total 7%
oil imports Others Other EU
failure, the US and Europe decided sanctions against Iran, Jan to June 2011 Spain
who, in return, threatened to close the Strait of Hormuz: 12% 5%
China 6% 13%
• Strengthening of the US military presence in the Gulf
• Oil embargo from the EU (due to start in July) which should 11%
hit 450,000 to 550,000 barrels a day of Iranian oil exports Total Japan
Iranian oil
But Iran banned crude oil supply to France, the UK and South Africa 22% exports 14%
10%
the EU right away 2.3 m
In addition, Japan, South Korea, Taiwan and India could 25% bl/d
reduce their purchases (up to 250,000 bl/d). In total,
Source: Financial Times
between 25% and 35% of Iran’s oil exports could be India
Turkey 13%
impacted 4% 11%
However, Saudi Arabia is increasing significantly its 51% 7%
production to curb price 10%
South Korea
Average daily oil flow
10%
through the Strait of
Hormuz (2011) 14 crude oil tankers
Primary factors driving demand are
Almost 17 million barrels Source: Financial Times economic growth and increased
35% 20%
requirements in the developing world
Iran political situations may place global
of all seaborne of oil traded
production and transportation at risk
traded oil worldwide
| Energy, Utilities & Chemicals Global Sector
3
4. Oil prices in European currencies are at their highest
Oil prices forecasts uncertainty is increased by In Euros, the crude oil spot price is at its highest
speculation: each barrel traded on the physical There is currently a $20 spread between WTI and Brent,
market is traded 35 times on the financial markets a the consequence of a localized logistic phenomenon
There is some consumption/price elasticity at Cushing, Oklahoma, where WTI is priced
High present oil prices are linked to tensions in President Obama is supporting a new pipeline
Middle East and Iran (Keystone XL)
Oil prices Crude oil spot – Brent in US dollars and in Euros Crude oil spot – Brent vs. WTI
130
123.04
Brent
120
110
101.53
100
WTI
90
80
70
May 2011 Sept 2011 Jan 2012 Apr 2012
Source: Focus Gaz, February 17, 2012 Source: Ycharts
Source: France inflation
High oil prices impact economic growth (EU’s oil import costs up 44% in 2011
compared to 2010 and net oil import bill estimated to account for 2.8% EU’s GDP in
2012 compared to 1.7% from 2000 to 2010) and trade exchanges balance
| Energy, Utilities & Chemicals Global Sector
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5. Gas is not a global market.
Very different regional pricing systems
Gas spot prices Gas prices evolution
50 100
In €/MWh ($4.4/MBtu=€10.6 /MWh)
DE - Import price NL - TTF
BE - Zeebrugge UK - NBP
40 DE - NCG FR - PEG Nord 80 Long-term contracts price
Brent month ahead Spot price
Gas prices [€/MWh]
30 60
Brent price [€/bl]
20 40
10 20
0 0
Europe versus US gas prices
Source: Gas Exchanges web sites, SG Commodities Research, BMWI – Capgemini analysis, EEMO13
US spot prices could go up on the mid-term triggered by the new EPA
(Environment Protection Agency) regulation on air pollution (Cross State Air
Pollution Rule) that could lead to 20% of US coal-fired plants phase-out and their
replacement by gas
Beginning of 2012, Gazprom has agreed to reduce by 10% the price of its
long-term contracts to Europe
US spot gas prices are only one third of long-term
European gas prices. For how long?
Source: Focus Gaz January 2012
| Energy, Utilities & Chemicals Global Sector
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6. Post-Fukushima nuclear reactors’ market: new builds mainly
in Asia, Russia and Middle East
Worldwide, 435 reactors are in operation, 62 under construction and 489 planned or proposed
(April 2012, World Nuclear Association)
Overview of existing nuclear plants and project capacities (as of April 2012)
The final number of planned or proposed 0 50,000 100,000 150,000 200,000 250,000
reactors is difficult to assess. However, two China MWe
points are clear: USA
Russia
• Provided reactors are run safely, the consequences India
of the Fukushima accident should be less Japan
France
important than viewed just after the accident
South Korea
• The proportion of new, safer “Generation 3 United Kingdom
reactor” builds will increase Ukraine
Canada
It is worthwhile mentioning that: UAE Operable
Saudi Arabia Under construction
• In the US: Germany
South Africa Planned
TVA has decided to complete Bellefonte 1 reactor
Vietnam Proposed
The Nuclear Regulatory Commission has certified the Turkey
design of Westinghouse Electric Co.'s AP1000 reactor Sweden
Southern Company is building 2 new nuclear plants in Spain
Vogtle, Georgia Finland
Czech Republic
• Finland announced a new build, the first Brazil
announcement of a new site anywhere in the world Switzerland
since the Fukushima accident Source: World Nuclear Association
• Russian Rosenergoatom has received a license for The vast majority of new constructions and
building the Kaliningrad plant existing plants in operation should continue with
• No.1 nuclear unit in Zhejiang Sanmen (China) has some delays and more safety focus.
restarted the infrastructure construction project The IEA* forecasts that nuclear output will rise by
• Bulgaria has decided to build a 7th reactor at more than 70% over the period to 2035
Kozloduy *IEA: International Energy Agency, World Energy Outlook 2011
| Energy, Utilities & Chemicals Global Sector
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7. There is some elasticity between the economic situation and
the energy consumption
EU electricity and gas consumption
Evolution of electricity and gas consumption (M/M-12) non-weather-adjusted
(non-weather-adjusted)
+8%
Mar-11 Apr-11 May-11 Jun-11 Jul-11 Aug-11 Sep-11 Oct-11 Nov-11 Dec-11 Jan-12 Feb-12
-6% -11%
5,599 5,010 5,708
5,098 Electricity
+4.1% -2.7% 9%
-4.7% Gas 14%
3,265 1%
3,294 3,136 -1% 0% 0%
3,177
-3% -2% -2% -3%
-4% -5%
-2% -10%
-4% -6% -4%
-7%
-10%
-12% -12%
-16% -14%
Electricity Gas
2008 2009 2010 2011 -22%
Source: SG Energy Pulse – Capgemini analysis, EEMO13
Source: ENTSO-E, BP – Capgemini analysis, EEMO13
In 2009, electricity and gas consumption dropped in Europe (-4.7% and -6.1% respectively) due to the crisis, in 2010,
they increased again (+4.1% and +7.0%) thanks to the economic recovery and colder than average winter
temperatures. Wholesale electricity and gas prices followed the same trend.
In 2011, European electricity and gas consumption decreased respectively by 2.7%* and 10.7%**, mainly due to a
mild weather. In France, electricity consumption decreased by 6.8% (weather-adjusted: +0.8%) and gas
consumption by 13.4% (weather-adjusted: -1.9%).
A second economic slowdown would impact negatively the energy consumption and prices
* Société Générale Energy Pulse (Focus group representing 63% of European electricity consumption)
**Eurogas
| Energy, Utilities & Chemicals Global Sector
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8. An overview of the European energy markets
Recent events are impacting the energy markets
• Middle-East political tensions
• Fukushima accident consequences
• Economic downturn
Present and future energy mix is evolving
• Renewables
• Gas
• Energy mix costs
Sustainability questions
• EU 2020 objectives
• Demand Response
Smart grids
Conclusion
| Energy, Utilities & Chemicals Global Sector
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9. European energy mix evolution
2010 and 2025 electricity mix (as of June 2011)
Energy mix should evolve towards
100%
more gas, renewables and coal (in
certain countries) 90%
Shale gas development is changing 80%
the picture
In the new IEA GAS* scenario, gas 70%
Solar + Biomass
share of primary energy consumption Wind
60%
reaches 25% in 2035 at a global level Hydro
Other f ossil
(more than coal, slightly less than oil) Gas
50%
but leads to a +3.5°C global Lignite + Coal
temperature increase (compared to Nuclear
40%
the +2°C objective) 2010 mix: lef t-
hand side bar
30%
In 2011, the IEA** has examined a Low
2025 mix: right-
hand side bar
Nuclear Scenario: 20%
• No new nuclear plant is built in OECD
countries 10%
• Non-OECD countries build only half of
the projected nuclear plants 0%
BE BG CH CZ DE ES FI FR UK HU IT LT NL PL RO SE SI SK
• The operating lifespan of existing
Source: ENTSO-E – Capgemini analysis and estimations, EEMO13
nuclear plants is limited to 45 years
However, today’s nuclear energy The energy mix evolution could result in:
development forecast is more • Higher costs (renewables development)
optimistic • Higher temperature increase (more fossil fuels)
*GAS: Golden Age of Gas, International Energy Agency • Lower energy independency
**World Energy Outlook 2011, IEA
| Energy, Utilities & Chemicals Global Sector
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10. Renewable energies have continued their quick development.
For how long?
As of May 2011, 10% of the European Growth rate of renewable energy sources
generation plants under construction 110% 2008
Solar PV Top 3 countries ranked by:
are from renewable energy sources (vs. Capacity Growth (abs.) Growth (%)
100% Capacity installed* Growth** (absolute)
7% in 2009) DE DE SK
1. DE 1. SK
In 2011, despite a drop of the new EU 90%
2005
IT CZ FR
2. ES 2. FR
CZ FR SI
wind installed capacity due to the 3. IT 3. SI
financial crisis and tougher regulations, 80% 2010
* Volume for wind, small hydro, geothermal and solar PV
wind power covered over 5% of EU’s
in MW and for biogas and biomass in TWh
** Relative growth additionally displayed for solar PV and
70% wind
consumption (172 TWh)
Many governments have or are launching
Growth (%)
60%
2007 2009
large offshore wind programs
• September 2010: 300 MW offshore wind 50%
2006
farm inaugurated in the UK Wind
40%
• France: part of the 3,000 MW tender Capacity Growth (abs.) Growth (%)
awarded to 2 consortiums (one led by EDF 30%
DE ES RO
for 1,400 MW and one led by Iberdrola for ES DE BG
IT FR PL
500 MW) in April 2012 20% 2005 2006
2008 2009
• North Sea: 400 MW (Germany) and 325
2007
2010
+ Biomass
MW (Belgium) under construction 10% 2009
DE PL
• Nuclear phase out in Germany should FI SE
0%
boost wind power but creates issues on 0 10 20 30 40 50 60 70 SE 80 NL 90 100 110 120 130 140 150
the grid
Electricity production (TWh)
Despite the solar PV growth in 2011 Source: Eur’Observer barometers – Capgemini analysis, EEMO13
globally (+44%), many solar companies
went bust because of China competition A stable governmental policy is key for renewables
In 2011, renewable energy investment
development. The eurozone sovereign debt issues should
rose 5% to US$260 billion* globally lead to subsidies decreases and threaten the EU 2020
(solar energy: +36%) Finance
*Bloomberg New Energy
objective achievement
| Energy, Utilities & Chemicals Global Sector
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11. The gas paradigm is changing
In the new IEA GAS* scenario, gas consumption is increased. Main World primary natural gas demand by
assumptions are: sector and scenario
• China ambitious policy for gas use
• Increased power plants’ consumption linked to lower nuclear energy
• Sustained low gas price
However, in this scenario, heavy investments in infrastructure
(difficult to finance) are needed
Global unconventional natural gas resources (tcm)
SE: 1,148
NO: 2,324
PL: 5,236
Source: World Energy Outlook 2011: Golden Age of Gas Report
FR: 5,040
Shale gas changes the gas
perspective:
• It increases the total gas
resources to 250 years of
consumption
• It is widely distributed
• It is cheap ($2/Mbtu in the US)
• It allows to repatriate gas
consuming industries as
Largest EU technically recoverable
FR: 5,040
shale gas resources (bcm) chemicals and to fight against
Source: EIA
deindustrialization
* GAS: Golden Age of Gas, IEA WEO 2011
| Energy, Utilities & Chemicals Global Sector
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12. Extensive analysis have been carried out on energy mix
scenarios in France
The Energies 2050 commission examined four existing energy scenarios:
1. Lifespan extension of existing reactors: all existing nuclear reactors lifetime is extended to 60 years providing the nuclear safety
authority (ASN) allows it
2. Quicker adoption of 3rd generation nuclear reactors: replacement of all existing nuclear reactors by 3rd generation reactors (EPR) as
soon as they reach their 40 years lifetime, which implies to build at least 2 EPR reactors per year during 10 years (from 2020 to 2030)
3. Progressive reduction of nuclear energy in the mix: all existing nuclear reactors are decommissioned when reaching their 40 years
lifetime and 1 on 2 reactors is replaced by a 3rd generation reactor (EPR), which leads to a 40-60% nuclear energy share by 2030
4. a. Nuclear phase out (more fossil fuel energy): all existing nuclear reactors are decommissioned when reaching their 40 years lifetime
and are replaced by fossil fueled plants
4. b. Nuclear phase out (more RES): all existing nuclear reactors are decommissioned when reaching their 40 years lifetime and are
replaced by renewable energy plants
Assumptions in the different scenarios by 2030
Electricity generation costs (€/MWh w/o taxes) CO2 emissions Employment Energy security
ing nuclear reactors
1 ~25 MtCO2/y Stable Stable
Not able to
ion nuclear reactors
2 ~25 MtCO2/y
measure
Stable
3 - 100,000 to Energy sources diversification
ar energy in the mix 30-50 MtCO2/y
150,000 jobs but increase of fossil fuel imports
4a
e fossil fuel energy) ~120 MtCO2/y Increase of fossil fuel imports
- 200,000 jobs
4b
hase out (more RES) ~45 MtCO2/y Potential issues on grid security
50 60 70 80 90 100 110
Source: Energies 2050, February 2012 – Capgemini analysis
Energies 2050 commission recommends extending nuclear reactors lifespan
| Energy, Utilities & Chemicals Global Sector
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13. An overview of the European energy markets
Recent events are impacting the energy markets
• Middle-East political tensions
• Fukushima accident consequences
• Economic downturn
Present and future energy mix is evolving
• Renewables
• Gas
• Energy mix costs
Sustainability questions
• EU 2020 objectives
• Demand Response
Smart grids
Conclusion
| Energy, Utilities & Chemicals Global Sector
13
14. Status on the EU 2020 objectives
After the 2009 drop (-7.1%), GHG emissions increased
110 EU-27 GHG emissions
Source: BP statistical report 2011, European Environment Agency, Eur’Observer – Capgemini analysis, EEMO13
by 2.2% due to the 2010 economic recovery. For 2011, Historical evolution of GHG emissions
EU-27 GHG emissions [base year=100]
105 Path to reach 2020 target
88% ETS sector CO2 emissions released data show a 2020 target f or EU-27
2.4%* decrease, mainly due to the combustion/power 100
sector (-3.1%)
An economic slowdown would push CO2 emissions 95
down
90
In its March 2011 Energy Efficiency plan, the EU
estimated that with current measures only half of the 85
objective would be attained and developed a new draft
-20%
Directive focusing on: 80
1990 1995 2000 2005 2010 2015 2020
• Triggering better energy efficiency of public buildings
1,850 EU-27 primary energy consumption
• Demand response programs notably through smart meters
roll out
EU-27 Primary energy consumption [Mtoe]
1,800
• White Certificates mechanisms extension
1,750
• Better usage of cogeneration
In 2013, the EU will re-assess the situation 1,700
-9%
1,650
The present European Emissions Trading
Scheme (ETS) needs to be amended to 1,600
provide predictable and high enough CO2 1,550
Historical evolution of primary energy consumption
Path to reach 2020 target
2020 target f or EU-27
prices. The UK announced a carbon price Projection with current measures in place
(as per the March 2011 EU Energy Ef f iciency Plan)
1,500
floor to start in 2013 at £16/t of CO2
-20%
1,450
*Deutsche Bank analysis, April 2012 1990 1995 2000 2005 2010 2015 2020
| Energy, Utilities & Chemicals Global Sector
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15. In certain countries as France, peak shaving is a key issue
during cold weather
% peak shaving observed in various pilots worldwide
Several means exist for
peak shaving and energy % peak shaving
Range of peak shaving
savings, that can be
combined or not:
• Dynamic tariffs (that
should be further
developed with the mass
roll-out of smart meters)
• Automation such as smart
thermostat, smart
appliances, in-home
displays or web-based
consumer portal
• Demand management
programs such as
customers alerts, social
networks communication or
feedbacks through bills,
web, SMS, smart phones
Source: Capgemini Consulting
Peak shaving: the use of displays helps but the customers’ behavior is key
| Energy, Utilities & Chemicals Global Sector
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16. In all developed countries, energy savings are key
% energy savings observed in various pilots worldwide
Large-scale pilots
operated for more than % energy saving
one year reach energy Range of energy saving
savings in the 2-6%
range while more
focused programs based
on customer segmentation
can reach up to 18%*
energy savings
In France, only one third
of peak shaving electricity
savings result in final
electricity consumption
reduction
Prices increase and
Time-of-Use tariffs
should trigger
sustained energy
savings results
Source: Capgemini Consulting
*Literature review for the Energy Demand Research Project, Sarah Darby, Oxford University, 2010
| Energy, Utilities & Chemicals Global Sector
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17. Demand response potential for EU-27 by 2020
Dynamic scenario:
In Capgemini Consulting’s Demand Response Demand Response study 3.1 Savings in CO2 emissions (in Mt of CO2 1 )
(DR) study*, the potential of peak shaving and 2012 results snapshot 1.0 3% Savings in electricity consumption (in equivalent
number of major cities2 and in % energy savings)
energy savings is modeled on the basis of a
5.2 4 2% Savings in peak generating capacities (in number
baseline scenario: 0.9 2% 4.3
of power plants3 and in % peak shaving)
• GDP growth 2010-20: 1.8% in average 0.8 1%
Moderate scenario:
Probable savings based on our observation of
• CAGR electricity consumption 2010-20: 0.7%
24 13%
current trends in regulatory, technical and
3.7
22 15% market conditions (in number of power plants)
• Some existing energy efficiency programs such 0.6 2%
2.5
0.4 1%
2.8 1.4
1.1
as Grenelle de l’Environnement or White 15 13% 0.5 2% 0.2 1% 1.0
0.2 1% 0.6
0.7
Certificates 14 13% 0.2 2%
7 13% 0.1 1% 0.1 1%
Assumptions are made on:
12 13%
6 13%
5 13%
• Regulation (norms and standards, energy 4 14% 4 15%
efficiency objectives, tariffs and incentive policies)
• Market design (possibility to monetize DR on
wholesale markets, contracts optimization, capacity
markets)
• Smart meters penetration and functionalities (for 1 Normative hypothesis: 1 kWh saves 700g CO2 (average European value considering avoided peak
capacity is mainly gas-fired plants)
the households segment) 2 Expressed in equivalent of avoided consumption of large size cities (2 mio inhabitants and 150,000
commercials, average consumption of 8.2 TWh/year)
3 Expressed in equivalent of avoided construction of power plants (500 MW)
And typical DR offerings are modeled with Source: Capgemini Consulting
hypothesis on their adoption by customers Our study shows that peak shaving potential is
significant while electricity savings potential is
*Demand Response study 2012 - Capgemini Consulting, VaasaETT and Enerdata more limited
| Energy, Utilities & Chemicals Global Sector
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18. An overview of the European energy markets
Recent events are impacting the energy markets
• Middle-East political tensions
• Fukushima accident consequences
• Economic downturn
Present and future energy mix is evolving
• Renewables
• Gas
• Energy mix costs
Sustainability questions
• EU 2020 objectives
• Demand Response
Smart grids
Conclusion
| Energy, Utilities & Chemicals Global Sector
18
19. Renewable energies are strongly impacting the grid
management
August 27, 2009 November 8, 2009
Source: Enagas, Outlook for LNG
In the absence of competitive electricity storage solutions, gas storage and CCGT
rapid ramp up helps managing the renewable output volatility on the grid
| Energy, Utilities & Chemicals Global Sector
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20. The need for smart grids is emerging
With the increase of renewable energies generation
share, the electrical grid’s management is facing new Communication
challenges as these energies provide unforeseeable and Technologies
intermittent power generation that is thus not Network Device and
schedulable. Balancing demand and supply on the grid Events Ops Management
becomes very complex.
Wind and solar power units are generally small and Back Office Applications
decentralized, allowing customers to become occasional
producers
The distribution network that is less sophisticated than Renewable
s
the transmission network is not designed to manage Advanced
those decentralized and sometimes bi-directional flows Metering
Smart grids concept has emerged to manage a Enhanced Power Grid
Plug-In Digital Communications and Control
dramatic increase in data flow, data storage and Hybrids
exchanges both for grid balance and customer Smart Meters &
Control Building Automation
relations. They necessitate new equipments and will be Interface
more digitally managed. Communication protocols will need
to be standardized in order to manage the information flow
on the net and with the customers as well as within
buildings Electric grid management is a key
factor to improve security of
New investments needed: Today there is funding in supply. However it’s not going to
Europe (€1 bn EU funds) and, more so, in the US (stimulus happen overnight. A lot of
grants: $3.4 bn), for smart grid studies and prototype regulatory and standardization
building but not for their real deployment, while issues have to be worked out.
investments are estimated at $200 bn worldwide from 2008-
2015 ($53 bn in the US)* *Pike Research
| Energy, Utilities & Chemicals Global Sector
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21. Smart grids: key success factors
Smart grids implementation will necessitate new investments:
• The transmission and distribution tariffs will have to increase and by consequence the electricity prices
• Regulators, governments and customers will have to accept these prices increases
Industrial R&D is needed to develop new equipments (as large competitive storage) or
improve existing ones (as HVDC connections).
Communication standards are crucial:
• US is mobilized at the government (Department of Energy) and equipment manufactures levels
• Europe is now considering more seriously this question
• Equipments conceived with the internationally adopted standards will have a clear advantage
Efforts on simulation and modeling are needed:
• For the transmission grid there is a need to build a new European High Voltage grid management
model
• On the distribution side, the retail market has to evolve and modeling is needed. Interesting
experiences initiated by regulators and involving all stakeholders (Utilities, equipment manufacturers,
IT service companies, local authorities...) have been launched in Victoria (Australia), Texas (USA) and
France.
| Energy, Utilities & Chemicals Global Sector
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22. Smart meters are the first steps for smart grids
Electricity and gas smart metering projects in Europe In addition to smart meters and
boxes, time of use tariffs,
Mass roll-out finalized Norway Finland
E Draft regulation issued in Feb. 2011 E Legislation into effect. At least electricity curtailment incentives
Mass roll-out by 2020 well-engaged 80% roll-out by 2016, 100% by 2018 80% roll-out by end 2013 and public education are key
Mass roll-out probably not elements to implement a demand
completed by 2020 Netherlands Sweden
E Legal framework for voluntary
E 100% smart meters
FI
implemented in 2009
management policy
UK installation adopted
E 27 million smart meters should Several pilots under way NO 80% of electricity customers in EU
be implemented by 2020 SE Member States should have smart
G Similar to electricity Estonia
Denmark
E Deployment by several
EE
E Mandatory nationwide meters by 2020. All countries
Ireland roll-out under discussion
E National roll-out
DNOs. No national plan
LV required to perform cost benefit
DK
planned for 2014-17 IE Germany analysis by September 2012
G Studies under way LT E 50 trials from 10 to 115,000 meters
for gas Nationwide roll out under discussion
UK
Customers can opt in or out
Belgium NL G Similar to electricity In September 2011, France has
E No legislation yet
Several business case BE DE PL Poland decided the mass roll out of 35
E Legislation should be ready in 2012
G
studies under way
Similar to electricity LU Pilots run by all Utilities million meters from 2013 to 2020 but
CZ G Similar to electricity the starting date will be delayed.
France SK
E Decision for roll-out of 35 FR
AT
Czech Republic 4 technologies experimented for
million smart meters by 2020 Austria CH E National roll-out under discussion
taken in 2011. E Legislation adopted in 2010.
HU
Several pilots under way gas smart meters (18,500 meters)
SI
G GreenLys pilot, decision for
mass roll-out by 2013
Pilots from 10,000 to RO Hungary in France. Final mass roll-out
240,000 meters
G Legislation under discussion
E Legislation adopted in 2011 decision should be taken in 2013
ES IT
G Legislation under discussion In Europe, the Value
BG
PT Chain unbundling
Portugal
E Smart meter substitution plan Spain
Italy
E 100% smart meters Greece
regulation impacts
presented by the regulator
Several pilots (30,000 to
E 100% smart meters should be implemented in 2009 GR E Roll-out under way negatively the return
50,000 meters) run
implemented by end 2018 G 80% smart meters to be
installed by 2016
G Plans for extending the
electricity system to
on smart meters
Source: ESMA, GEODE – Capgemini analysis, EEMO12, updated March 2012
water and gas meters investment
| Energy, Utilities & Chemicals Global Sector
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23. An overview of the European energy markets
Recent events are impacting the energy markets
• Middle-East political tensions
• Fukushima accident consequences
• Economic downturn
Present and future energy mix is evolving
• Renewables
• Gas
• Energy mix costs
Sustainability questions
• EU 2020 objectives
• Demand Response
Smart grids
Conclusion
| Energy, Utilities & Chemicals Global Sector
23
24. Utilities need to change their business model
« Energy Orb » (PG&E) gives visual
Oil and gas procurement tensions and post- indications to clients involved in energy
demand management programs
Fukushima accident are leading to changes in the
energy landscape
European Utilities are negatively impacted by the
economic slowdown, governments pressure on prices,
potential extra-taxes and frozen regulation
US Utilities are negatively impacted by low gas prices
They need to adapt their business model, increase
competitiveness and launch profitable innovative
projects
Developed countries have to limit their energy
demand and Utilities have a key role to play
Public deserves a proper information on all energy-
related questions
| Energy, Utilities & Chemicals Global Sector
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25. About Capgemini
With around 120,000 people in 40 countries, Capgemini is one of the world's foremost providers of
consulting, technology and outsourcing services. The Group reported 2011 global revenues of EUR 9.7
billion. Together with its clients, Capgemini creates and delivers business and technology solutions that fit
their needs and drive the results they want.
A deeply multicultural organization, Capgemini has developed its own way of working, the Collaborative
Business ExperienceTM, and draws on Rightshore ®, its worldwide delivery model.
With EUR 670 million revenue in 2011 and 8,400 dedicated consultants engaged in Utilities projects
across Europe, North & South America and Asia Pacific, Capgemini's Global Utilities Sector serves the
business consulting and information technology needs of many of the world’s largest players of this
industry.
More information is available at www.capgemini.com/energy.
Rightshore® is a trademark belonging to Capgemini
| Energy, Utilities & Chemicals Global Sector
Rightshore® is a trademark belonging to Capgemini
25