Launch Presentation

1. IEA
© OECD/IEA 2017
Energy Technology Perspectives 2017
Catalysing Energy Technology Transformations

2. © OECD/IEA 2017
Key points of orientation
• Global energy markets are changing rapidly
ØRenewables supplied half of global electricity demand growth in 2016, and increase in
nuclear capacity reached highest level since 1993
ØGlobal energy intensity improved by 2.1% in 2016
ØElectric car sales were up 40% in 2016, a new record year
• The energy sector remains key to sustainable economic growth
Ø1.2B people lack access to electricity; 2.7B people lack access to clean cooking
ØLargest source of GHG emissions today, around two-thirds of global total
ØLargest source of air pollution, linked to 6.5 million premature deaths per year
• There is no single story about the future of global energy
ØFast-paced technological progress and changing energy business models

3. © OECD/IEA 2017
Global CO2 emissions flat for 3 years – an emerging trend?
IEA analysis shows that global CO2 emissions remained flat in 2016 for the third year in a row, even though the global
economy grew, led by emission declines in the US and China.
5
10
15
20
25
30
35
1970 1975 1980 1985 1990 1995 2000 2005 2010 2014 2015 2016
Gt
Global energy-related CO2 emissions

4. © OECD/IEA 2017
0
10
20
30
40
2014 2020 2030 2040 2050
GtCO2
Efficiency 40%
Renewables 35%
Fuel switching 5%
Nuclear 6%
CCS 14%
How far can technology take us?
Pushing energy technology to achieve carbon neutrality by 2060
could meet the mid-point of the range of ambitions expressed in Paris.
Technology area contribution to global cumulative CO2 reductions
Efficiency 40%
Renewables
35%
Fuel switching
5%
Nuclear 6%
CCS 14%
Efficiency 34%
Renewables 15%
Fuel switching 18%
Nuclear 1%
CCS 32%
Global CO2 reductions by technology area
2 degrees Scenario – 2DS
Reference Technology Scenario – RTS
Beyond 2 degrees Scenario – B2DS
0 200 400
Gt CO2 cumulative reductions in 2060

5. © OECD/IEA 2017
The potential of clean energy technology remains under-utilised
Recent progress in some clean energy areas is promising, but many technologies still need a strong push to achieve their
full potential and deliver a sustainable energy future.
Energy storage
Solar PV and onshore wind
Other renewable power
Building construction
Nuclear
Transport – Fuel economy of light-duty vehicles
Lighting, appliances and building equipment
Electric vehicles
Energy-intensive industrial processes
Transport biofuels
Carbon capture and storage
More efficient coal-fired power
●Not on track
●Accelerated improvement needed
●On track

6. © OECD/IEA 2017
Solar PV and Wind are still leading the transition…
Solar PV and onshore wind electricity generation are expected to grow
by 2.5 times and by 1.7 times, respectively, over 2015-20.
Electricity generation of selected renewable power generation technologies
0
200
400
600
800
1 000
1 200
2000 2005 2010 2015 2020 2025
TWh
PV
0
400
800
1 200
1 600
2 000
2 400
2000 2005 2010 2015 2020 2025
TWh
Onshore Wind
Data Forecast Target

7. © OECD/IEA 2017
… but can’t make up for other low-carbon generation sources
While renewable power additions keep breaking records, they need to grow much faster to reach the 2DS electricity
generation targets. Progress on early-stage technologies also needs to accelerate.
Total renewable power generation by region
0%
5%
10%
15%
20%
25%
30%
35%
40%
0
2 000
4 000
6 000
8 000
10 000
12 000
14 000
2000
2002
2004
2006
2008
2010
2012
2014
2016
2018
2020
2025
Share of Renewable Generation
Generation (TWh)
Rest of Non-OECD
Brazil
India
China
OECD Europe
OECD Asia Oceania
OECD Americas
Share of renewable
generation
Share of renewable
generation 2025
Historical Forecast Targets
in the 2DS
in the 2DS

8. © OECD/IEA 2017
Can we push up the low-carbon power deployment pace?
Average capacity additions in different periods in the B2DS
Recent successes in solar and wind
will have to be extended to all low-carbon solutions, and brought to a scale never experienced before.
0 100 200 300 400 500 600 700
Last Decade
Last year
2017-2030
2030-2060
GW per year
Fossil CCS (Incl.BECCS) Nuclear Hydro Wind Solar PV Other renewables

9. © OECD/IEA 2017
Centralised fuel production,
power and storage
Systems Integration is essential for a sustainable energy future
We need to move away from a one-directional energy delivery philosophy

10. © OECD/IEA 2017
Centralised fuel production,
power and storage
Renewable energy resources
EV
Co-generation
Smart energy
system control
Distributed
energy resources
Surplus heat
H vehicle2
Systems Integration is essential for a sustainable energy future
We need to move away from a one-directional energy delivery philosophy to a digitally-enhanced, multidirectional and
integrated system that requires long-term planning for services delivery.

11. © OECD/IEA 2017
The value of storage is starting to drive new solutions
Globally installed non-pumped hydro
electricity storage (GW)
0
50
100
150
200
250
2016 2020 2025
GW
non-PHS Storage Pumped Hydropower Storage
0,0
0,5
1,0
1,5
2,0
2,5
3,0
3,5
4,0
2011 2014 2016
GW
Globally installed electricity storage (GW)
Positive market and policy trends supported a year-on-year growth of over 50% for non-pumped hydro storage
But near-term storage needs will remain largely answered by existing or planned pumped hydro capacity.

12. © OECD/IEA 2017
Can we enact a storage revolution
Batteries experience a huge scale-up in the B2DS, with EV battery markets leading other sectors in size.
Installed battery storage and costs under various scenarios
0
100
200
300
400
500
600
700
800
900
1000
0
10 000
20 000
30 000
40 000
50 000
60 000
2000 2015 2030 2045 2060 2015 2030 2045 2060
2DS B2DS
USD/kWh
GWh
All other
sectors
EV batteries
Battery costs,
2DS
Battery costs,
B2DS

13. © OECD/IEA 2017
EVs are still on track, but need continued support
The global PEV car stock has reached 2 million units in circulation last year, but sales growth went from 70% last year to
40% this year, suggesting an increasing risk to start diverging from a 2DS trajectory.
Evolution of the global BEV and PHEV stock, 2010-2016
0%
50%
100%
150%
200%
0
500
1 000
1 500
2 000
2010 2011 2012 2013 2014 2015 2016
Number of vehicles on the road
(Thousands)
PHEV
BEV
Others
Germany
France
United Kingdom
Netherlands
Norway
Japan
USA
China
EV Growth Rate

14. © OECD/IEA 2017
Can we change the landscape of transport ?
The transportation sector already experiences technological change,
but won’t shed its oil dependency without assertive policies.
Vehicle sales and technology shares under different scenarios
Heavy-Duty Vehicles (millions)Light-duty Vehicles (millions)
0
40
80
120
160
200
2015 RTS - 2060 B2DS - 2060
0
5
10
15
20
25
2015 RTS - 2060 B2DS - 2060

15. © OECD/IEA 2017
Enhanced buildings efficiency could also improve system flexibility
Efficiency technologies can provide the same level of comfort while reducing energy demand despite doubling floor area.
112 EJ157 EJ123 EJ
2014
(123 EJ)
RTS 2060
(157 EJ)
B2DS 2060
(112 EJ)
31% 54% 61%
Electricity ElectricityElectricity
37%
24%
3%
5%
Electricity
31%
Fossil fuels Traditional biomass Renewables Other Electricity
Energy use in the buildings sector under different scenarios

16. © OECD/IEA 2017
Can we produce materials more sustainably ?
Effective policies and public-private collaboration are needed to enable an extensive roll out of energy and material
efficiency strategies as well as a suite of innovative technologies.
0
2
4
6
8
10
12
0
50
100
150
200
250
300
2014 2030 2060 2030 2060
RTS B2DS
Gt CO2
EJ
Other industries
Pulp and paper
Aluminium
Chemicals and petrochemicals
Cement
Iron and steel
Direct CO2 emissions
Energy use and direct CO2 emissions in various industrial sectors under different scenarios

17. © OECD/IEA 2017
Can we produce enough sustainable biomass ?
Around 145 EJ of sustainable bioenergy is available by 2060 in all our decarbonisation scenarios,
but gets used differently between the 2DS and the B2DS.
0
25
50
75
100
125
150
RTS 2DS B2DS
2014 2060
EJ
Transport
Industry
Buildings
Agriculture
Fuel transformation
Power
Bioenergy use by sector

18. © OECD/IEA 2017
CCS is happening today,CCS is happening today, but needs to be ramped up hundreds of times to achieve long-term goals
The role for CCS varies based on local circumstances.
A challenging task ahead for CCS
0
2 000
4 000
6 000
8 000
10 000
12 000
2030 2060 2030 2060
Today 2DS B2DS
Mt CO₂
Rest of world
EU
IND
CHN
MEA
USA
Amount of CO2 captured under various scenarios
0
20
40
Today
Mt CO₂

19. © OECD/IEA 2017
0
10
20
30
40
2012 2015
USD (2016) billion
Private Public Top 3 firms
0
10
20
30
40
2012 2015
USD (2016) billion
Private Public Top 3 firms
Global clean energy RD&D spending needs a strong boost
Global RD&D spending in efficiency, renewables, nuclear and CCS plateaued at $26 billion annually,
coming mostly from governments.
Global clean energy RD&D spending
0
10
20
30
40
2012 2021
USD (2016) billion
Private Public Top 3 firms
Mission
Innovation
Mission
Innovation
Top 3 IT company R&D spenders
Global RD&D spending in efficiency, renewables, nuclear and CCS plateaued at $26 billion annually,
coming mostly from governments.
Mission Innovation could provide a much needed boost.

20. © OECD/IEA 2017
Conclusions
• Early signs point to changes in energy trajectories, helped by policies
and technologies, but progress is too slow
• An integrated systems approach considering all technology options
must be implemented now to accelerate progress
• Each country should define its own transition path and scale-up its
RD&D and deployment support accordingly
• Achieving carbon neutrality by 2060 would require unprecedented
technology policies and investments
• Innovation can deliver, but policies must consider the full
technology cycle, and collaborative approaches can help