World Energy Investment 2016

177 Pages·2016·3.22 MB·English

by  International Energy Agency

World Energy
20
Investment
16
World Energy
20
Investment
16
INTERNATIONAL ENERGY AGENCY
The International Energy Agency (IEA), an autonomous agency, was established in November 1974.
Its primary mandate was – and is – two-fold: to promote energy security amongst its member
countries through collective response to physical disruptions in oil supply, and provide authoritative
research and analysis on ways to ensure reliable, affordable and clean energy for its 29 member
countries and beyond. The IEA carries out a comprehensive programme of energy co-operation among
its member countries, each of which is obliged to hold oil stocks equivalent to 90 days of its net imports.
The Agency’s aims include the following objectives:
Secure member countries’ access to reliable and ample supplies of all forms of energy; in particular,
through maintaining effective emergency response capabilities in case of oil supply disruptions.
Promote sustainable energy policies that spur economic growth and environmental protection
in a global context – particularly in terms of reducing greenhouse-gas emissions that contribute
to climate change.
Improve transparency of international markets through collection and analysis of
energy data.
Support global collaboration on energy technology to secure future energy supplies
and mitigate their environmental impact, including through improved energy
efficiency and development and deployment of low-carbon technologies.
Find solutions to global energy challenges through engagement and
dialogue with non-member countries, industry, international
organisations and other stakeholders.
IEA member countries:
Australia
Austria
Belgium
Canada
Czech Republic
Denmark
Estonia
Finland
France
Germany
Secure
Greece Sustainable
Hungary Together
Ireland
Italy
Japan
Korea
Luxembourg
Netherlands
New Zealand
Norway
Poland
Portugal
© OECD/IEA, 2016 Slovak Republic
International Energy Agency Spain
9 rue de la Fédération Sweden
75739 Paris Cedex 15, France
Switzerland
www.iea.org Turkey
United Kingdom
Please note that this publication United States
is subject to specific restrictions
that limit its use and distribution. The European Commission
The terms and conditions are also participates in
available online at www.iea.org/t&c/ the work of the IEA.
Foreword
Investment is the lifeblood of the global energy system. Money invested today in our
energy systems, in large-scale power plants and transmission lines, home energy efficiency
upgrades or innovative low-carbon technologies will have a lasting influence on energy
supply and demand for decades to come. A sustainable, prosperous and healthy future for
the world depends on these investment decisions, which are shaped by market frameworks
and ultimately determined by government policies.
One year ago, I began my new role as Executive Director of the International Energy Agency
(IEA) by presenting a new vision for the Agency that is founded on three pillars: opening the
doors of the IEA to emerging economies, a strengthened and broadening commitment to
energy security, and bolstering the role of the IEA as an international hub for clean energy
technology and energy efficiency. The need for timely and cost-effective investments
underpins policy goals across these three pillars.
With World Energy Investment 2016 we are taking a big step forward. We hope this new
annual series will provide a unique benchmark of all the main energy-related investments
happening around the world today. It also shines a light on the implications of these
investments for energy security, low-carbon energy and energy markets. It is critically
important to properly measure and understand what is happening in boardrooms, banks,
or construction sites around the world to make sure that the right decisions are made by
public and private actors. By moving closer to what is happening on the ground, our aim is
to provide decision makers with a tool to assess current trends and identify opportunities.
This work on investment complements our other regular IEA publications and is enabled by
our close work with governments and businesses, whose insights and contributions have
been invaluable.
The critical importance of energy investment to global prosperity will grow as countries
look for ways to meet their climate goals and hundreds of millions of people gain access to
modern energy services. Whether the objective is to build systems that are resilient to
supply shocks or to deploy low-carbon technologies in a timely manner, the ability to
mobilise investment is ultimately the key determinant of the success or failure of an energy
policy. As we continue to implement the three pillars of our new vision, measuring
investment flows and assessing their implications for the global energy system will be
priorities for the IEA.
Dr Fatih Birol
EInxteecruntaivtieo nDairle Ecntoerrg y Agency A, 2016
E
D/I
C
E
Foreword 3 © O
A, 2016
E
D/I
C
E
O
©
Acknowledgements
This report was prepared by the Economics and Investment Office of the International
Energy Agency (IEA). It was designed and directed by Laszlo Varro, Chief Economist of the
IEA. The lead authors were Simon Bennett (investment in energy end use and efficiency),
Alessandro Blasi (investment in oil, gas and coal) and Michael Waldron (investment in
electricity and renewables). Principal contributors to the report were Alfredo Del Canto,
Tomi Motoi and Yoko Nobuoka. Other key contributors were Ingrid Barnsley, Carlos
Fernandez Alvarez, Thomas Giehm, Christopher Gully, Kristine Petrosyan, Andrew Wilson
and Yang Lei. Trevor Morgan edited the manuscript and Janet Pape provided essential
support.
The report is indebted to the high standard of investment data production across all parts
of the IEA. In particular, the work of the Energy Supply Outlook Division (Tim Gould, Chris
Besson, Ian Cronshaw, Christophe McGlade and Pawel Olejarnik), the Energy Efficiency
Division (Brian Motherway, Tyler Bryant, Brian Dean and Samuel Thomas), the Energy
Demand Outlook Division (Laura Cozzi, Marco Baroni, Timur Gül, Brent Wanner, David
Wilkinson and Shuwei Zhang) and the Renewable Energy Division (Paolo Frankl, Yasmina
Abdelilah, Heymi Bahar, Pharoah Le Feuvre and Megan Mercer) was invaluable to the
analysis.
We would like to thank the following organisations that gave their time to answer
questions and respond to cost surveys covering different parts of the energy value chain:
Banpu, Barclays, BP, Chevron, Citigroup, Enel, Eni, ExxonMobil, European Solar Thermal
Electricity Association (ESTELA), GE, Goldman Sachs, Iberdrola, J-Power, Morgan Stanley,
Navigant, OMV, Petrofac, Philips, Repsol, Schlumberger, Shell, Statoil, Total and
WindEurope.
The report benefited from valuable inputs, comments and feedback from other experts
within the IEA, including Manuel Baritaud, Kamel Ben Naceur, David Benazeraf, Mariano
Berkenwald, Pierpaolo Cazzola, Loïc Coent, Karolina Daszkiewicz, John Dulac, Marc-Antoine
Eyl-Mazzega, Duarte Figueira, Nathan Frisbee, Jean-François Gagné, Costanza Jacazio, Joerg
Husar, Alexander Keeley, Simon Keeling, Florian Kitt, Markus Klingbeil, Vladimir Kubecek,
Sonja Lekovic, Raimund Malischek, Duncan Millard, David Morgado, Noor Miza Muhamad
Razali, Luis Munuera, Roberta Quadrelli, Uwe Remme, Keisuke Sadamori, Jesse Scott, Paul
Simons, Tristan Stanley, Johannes Trueby, Kevin Tu, Aad Van Bohemen, Matthew
Wittenstein. Thanks also go to Muriel Custodio, Astrid Dumond, Rebecca Gaghen, Jad
Mouawad, Bertrand Sadin, Robert Stone and Therese Walsh of the IEA Communication and
Information Office for their help in producing the report.
A, 2016
E
D/I
C
E
Acknowledgements 5 © O
Many experts from outside of the IEA provided input, commented on the underlying
analytical work and reviewed the report. Their comments and suggestions were of great
value. They include:
Géraldine Ang Organisation for Economic Co-operation and Development
(OECD)
Marco Annunziata GE
Alexander Antonyuk European Investment Bank (EIB)
Jean-Paul Bouttes EDF
Barbara Buchner Climate Policy Initiative (CPI)
Prach Chongkittisakul Banpu
Carlo Crea Terna
Giles Dickson WindEurope
Szilvia Doczi Arup
Jonathan Elkind Department of Energy, Government of the United States
Paolo Falcioni European Committee of Domestic Equipment Manufacturers
Mark Finley BP
Nikki Fisher AngloAmerican
Benjamin Freas Navigant
Jaejoo Ha Nuclear Energy Agency
Michael Hackethal Federal Ministry for Economic Affairs and Energy, German
Government
Tom Howes European Commission, Directorate-General for Energy
Anil Jain National Institution for Transforming India (NITI) Aayog,
Government of India
Christopher Kaminker OECD
Ken Koyama Institute of Energy Economics, Japan (IEEJ)
Alex Körner Consultant
Jochen Kreusel ABB
Ross Lambie Department of Industry, Innovation and Science, Australian
Government
A, 2016
E
D/I
C
E
6 Acknowledgements © O
Richard Lavergne Ministère de l'Environnement, de l'énergie et de la mer,
Government of France
Benoit Lebot International Partnership for Energy Efficiency Cooperation
(IPEEC)
Mark Lewis Barclays
Michael de la Mothe Natural Resources Canada, Government of Canada
Steve Nadel American Council for an Energy-Efficient Economy (ACEEE)
Gilles de Noblet Schlumberger
Nick Norton Foreign and Commonwealth Office, UK Government
Hokuto Otsuka OECD
Gregor Pett E.ON
Andrew Prag OECD
Geoffrey Rothwell OECD Nuclear Energy Agency
Felix Rüsch OMV
Pierre Sigonney Total
Filipe Silva OECD
Manpreet Singh KPMG India
Konstantin Staschus ENTSO-E
James Steel Department for Business, Energy and Industrial Strategy, UK
Government
Kuniharu Takemata J-Power
Cecilia Tam Asia Pacific Energy Research Centre (APERC)
Michael Taylor International Renewable Energy Agency
Jakob Thomä 2 Degrees Investing Initiative
Wim Thomas Shell
Rick Truscott CLP Power
Graham Weale RWE
Carlos Salle Alonso Iberdrola
Mark Shores ExxonMobil
Michael Sinocruz Asia Pacific Energy Research Centre (APERC) A, 2016
E
D/I
C
E
Acknowledgements 7 © O
Kazushige Tanaka Government of Japan
Julien Touati Meridiam Infrastructure
Eirik Wærness Statoil
Robert Youngman OECD
Yongping Zhai Asian Development Bank (ADB)
Liyang Zhang State Grid Corporation of China (SGCC)
Xiuli Zhang UC Davis
The individuals and organisations that contributed to this study are not responsible for any
opinions or judgements it contains. All errors and omissions are solely the responsibility of
the IEA.

Comments and questions are welcome and should be addressed to:
Mr. Laszlo Varro, Chief Economist
Economics and Investment Office, International Energy Agency
31-35 rue de la Fédération, 75739 Paris Cedex 15, France
Telephone: [phone]; Email: [email protected]
More information about the report and the methodologies is available at
www.iea.org/investment.
A, 2016
E
D/I
C
E
8 Acknowledgements © O
Table of contents
Executive summary ...................................................................... 13
Introduction ................................................................................. 19
A new annual report on global energy investment...................................... 19
Defining and measuring energy investment ................................................ 19
1. Energy investment trends ......................................................... 21
Highlights .................................................................................................. 21
Global energy investment trends ............................................................... 22
A slump in capital spending on energy, mainly due to lower costs ......... 22
Changes in relative costs will reshape markets and investment .............. 24
Energy market, macroeconomic and financing trends ................................. 26
A mixed year for the world economy ....................................................... 30
Unorthodox monetary policy continues to affect investment ................. 32
Sources of energy finance are becoming increasingly diverse ................. 34
2. Investment in end use and efficiency ........................................ 37
Highlights .................................................................................................. 37
Overview ................................................................................................... 38
Investment in energy-using assets .............................................................. 38
Investment in industrial capacity is on the wane ..................................... 39
A huge wave of construction begins to break .......................................... 41
Household energy demand in OECD countries has peaked ..................... 42
Investment in energy efficiency .................................................................. 43
Spending on efficiency continues to grow ................................................ 43
Energy performance standards are driving efficiency investment .......... 45
Energy efficiency investment closely linked to consumer spending ........ 46 A, 2016
E
D/I
C
E
Table of contents 9 © O