Renewable energy, expected growth
Renewable energy and nuclear power are complementary components of a balanced CO2-free energy mix. Large-scale development and financial incentives are combining to make renewables increasingly competitive in today’s market. AREVA is looking ahead to the promising medium- and long-term prospects of this sector. The group is already involved in 3 key markets: wind power, bioenergy and hydrogen energy.
In 2008, renewable energy surpassed fossil fuels as a share of new electricity generation capacity, with more than 40 GW (gigawatts) installed.
The development of renewable energy has proven particularly strong in Europe. The European Union set a target of incorporating 20% renewables into its energy mix by 2020.
North America is also a growth region. Legislation implemented in over half of the states in the United States plan for renewable energy levels to reach at least 12% of total electricity production by 2020.
Niche renewable energy markets can also be found in developing countries, where low-cost resources are often plentiful (e.g., biomass in Brazil and India, sun in the Sahara).
Environmental and financial advantages
The Kyoto protocol is a boost for renewables, favoring this type of energy in the fight against climate change. Some technologies have reached technical maturity and are now cost competitive with other energy sources when CO2 values are taken into account. The impact of renewable energy in terms of waste emissions is effectively nil.
- Onshore wind: 11 kg CO2 - Eq/MWh
- Offshore wind: 14 kg CO2 - Eq/MWh
- Nuclear: 15 kg CO2 - Eq/MWh
- Natural gas: 420 kg CO2 - Eq/MWh
Source: European Commission, 2009.
Produced on a large scale, renewable energy is often eligible for financial incentives. When assessing the competitiveness of renewables, one must also take into account the price variations and externalities associated with fossil fuels.
AREVA in the running
AREVA created the Renewable Energies business group in late 2006 to confirm its intention of offering a range of power generation solutions that do not emit greenhouse gases. Nuclear power and renewable energy are also complementary components of a balanced CO2-free energy mix.
AREVA’s strategy is to become a global leader in renewable energy and to reassert its leadership position in supplying solutions that meet energy needs in periods of both low and peak consumption.
Wind: rapidly growing market
Today, the wind power market represents around 30 billion euros and has annual growth of 30-35%. It can be divided into:
- Onshore wind power
- Offshore wind power
Europe continues to be the primary market, with 60% of the world’s installed capacity.
Offshore wind represents installed power of 1.5 GW, and numerous wind farms projects in progress will add another 37 MW (megawatts) of power. Germany and the United Kingdom are among Europe’s most promising markets. Annual growth is set to reach 3-5 GW by 2015.
The market’s rise was slowed considerably by the global economic crisis during the first half of 2009. This period of turbulence will not, however, affect uptake of offshore wind power as a source of green electricity in the medium term.
In this context, AREVA’s strategy is to quickly develop its offshore operations in order to lead the wind power market with a 25% market share by 2012. So far, nearly 250 of AREVA’s M5000 wind turbines have been selected for European offshore projects.
Bioenergy: world’s leading source of renewable energy
In the recent study by the International Energy Agency (IEA) entitled “Scenarios & Strategies to 2050”, the share of electricity production from biomass will reach 2-5% in 2050, compared to 1.3% in 2003. Biomass generation capacity currently stands at 62 GW and is expected to grow 6-9% over the next 5 years.
Since biomass uses proven technology, it has a lot of global potential relative to other types of renewable energy. However, the market remains fragmented because of the proliferation of players involved and the many different types of biomass.
Given the abundance of resources, development should be concentrated primarily in developing countries where it can support the rural development of certain regions. Emerging countries represent key growth areas: India, China, Brazil and countries in Southeast Asia.
In the United States, wood is the primary source of bioenergy, representing 6,000 MW of installed capacity. According to forecasts by the IEA and other experts, this capacity could double within 10 years.
Hydrogen energy is a key element in the future energy mix
To date, the hydrogen market is one where industrial gas is consumed in various applications such as fertilizer, metals, glass and of course petrochemicals. It has regular annual growth of around 55 MT or 120 G€. The medium- and long-term prospects are particularly promising with the oil industry’s needs growing (refining synthetic fuels).
When used with a fuel cell, hydrogen is also an environmentally friendly energy vector with many applications, from stationary (e.g., back-up generators, generators and cogeneration) to transport (e.g., public and freight). Growth in these new markets makes them very attractive, and hydrogen and fuel cell solutions combine the advantages of performance (output, autonomy, design) with those of ecology (no greenhouse gas emitted at the point of end use, completely carbon-free if nuclear or renewable electricity is used, silent) and community development (possibility of decentralized production and consumption).
AREVA has positioned itself in 2 areas with strong synergy:
- Hydrogen (and oxygen) production using water electrolysis to provide an alternative to natural gas reforming and to offer a carbon-free solution in the event that CO2-free electricity is used (nuclear or renewable)
- Constant source of electric power and power storage for intermittent renewable energy sources (solar and wind) using the partial or complete hydrogen chain (production, long-term storage, electrical conversion)
The preliminary markets for storage are isolated sites with weak connections, such as islands and countries with strong growth like India. The target market share is 10-30%, based on certain products and geography, of a global annual market estimated at more than 7 G€ in 2015.
To complement these 2 key areas, AREVA will consolidate its technological advances in a partnership for preliminary markets such as unmanned vehicles and drones to increase their autonomy and sustainable mobility in order to help reduce CO2 and promote acceptance and deployment of these innovative technologies.
Currently, solar energy is used particularly in industrialized countries where there is a lot of sun and government support for this type of energy. Regional strategies have established important targets for the construction of more than 20 GW of additional CO2-free production capacity, including solar, in Mediterranean countries by 2020.
Among the various technologies available, concentrated solar power (CSP) is an important part of global renewable energy development, with annual growth of 18%: (source: IEA).
- 400 MW of solar thermodynamic equipment was installed in 2007,
- More than 1,000 MW was added in 2009,
- 9,000 MW more is expected in 2012.
AREVA has chosen to align itself with CSP, focusing on 2 technologies: concentrated solar thermal and concentrated solar photovoltaic (CPV). These 2 technologies have significant synergies with our nuclear expertise.