CEM Progress Report PDF

Clean
energy
Progress
Report
I E A input to t he
Cl e a n E ne rgy Minist e ri a l
Clean
energy
Progress
Report
I E A input to t he
Cl e a n E ne rgy Minist e ri a l
U pdat e June 2 011

INTERNATIONAL ENERGY AGENCY
The International Energy Agency (IEA), an autonomous agency, was established in November1974.
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 28 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 Agencys aims include the following objectives:
n 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.
n 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.
n Improve transparency of international markets through collection and analysis of
energy data.
n 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.
n 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
Finland
France
Germany
Greece
Hungary
Ireland
Italy
Japan
Korea (Republic of)
Luxembourg
Netherlands
New Zealand
Norway
Poland
Portugal
Slovak Republic
OECD/IEA, 2011 Spain
International Energy Agency Sweden
9 rue de la Fdration
75739 Paris Cedex 15, France Switzerland
Turkey
www.iea.org
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 available also participates in
online at www.iea.org/about/copyright.asp the work of the IEA.
OECD/IEA2011 Cleanenergyprogressreport
Tableofcontents
Foreword...........................................................................................................................................5
Acknowledgements..........................................................................................................................7
Keyfindings.......................................................................................................................................9 Page|3
Growthincleanenergyhasbeenstrong...butneedstoexpandandaccelerate.......................11
Smarter,moreambitiousstrategiesareneeded...........................................................................15
Recommendationsforenergyministers........................................................................................18
MaketheCleanEnergyMinisterialaninternationalforumforcommitment,
actionandsharedlearning......................................................................................................18
Cleanenergyprogressreport.........................................................................................................22
Energyefficiency......................................................................................................................22
HigherefficiencycoaluseandCCS..........................................................................................31
Nuclearpower.........................................................................................................................37
Renewableenergy...................................................................................................................40
Biofuels....................................................................................................................................55
Electricvehiclesandvehicleefficiency....................................................................................58
Acronyms,abbreviationsandunits...............................................................................................64
Acronyms.................................................................................................................................64
Abbreviations...........................................................................................................................65
Unitsofmeasure.....................................................................................................................65
References......................................................................................................................................66
Listoffigures
Figure1.IncrementaltotalprimaryenergysupplyinCEMandtheworld,200008..............11
Figure2.Danishwindpowercapacitygrowth........................................................................16
Figure3.ChinaandIndiasgrowthinwindpowercapacity...................................................17
Figure4.KeytechnologiesforreducingCO2emissionsunderthe
BLUEMapscenario,2010........................................................................................................22
Figure5.EstimateofpotentialCO2emissionssavingsthrough
implementationofIEA25energyefficiencypolicyrecommendations..................................23
Figure6.Changeinenergyefficiencyofnewrefrigerator/freezercombination
unitsinselectcountries.............................................................................................................25
Figure7.EstimatedCFLsalesbyregion..................................................................................26
Figure8.Currenttrendinglobalmanufacturingenergyintensitycompared
toBaselineandBLUEMapscenarios.......................................................................................28
Figure9.Publicspendingonenergyefficiencyinbuildingsandindustry..............................30
Figure10.Worldincrementalgrowthinelectricitygeneration,200008..............................31
Figure11.ModernisationoftheChinesecoalfleet................................................................32
Cleanenergyprogressreport OECD/IEA2011
Figure12.CCSdeploymentbyregion,201050......................................................................33
Figure13.GlobalstatusoflargescaleCCSdemonstrationprojects......................................34
Figure14.StatusofpublicfundingsupporttoCCS.................................................................35
Figure15.Publicspendingonenergyefficiencyinbuildingsandindustry............................36
Page|4
Figure16.Globalnuclearcapacityvs.BLUEMapscenario,200520......................................37
Figure17.Nuclearcapacityunderconstructionandnumberofreactors..............................38
Figure18.PublicspendingonnuclearfissionRD&Din2010..................................................39
Figure19.Globalpowergenerationfromrenewablesourcesvs.BLUEMapscenario..........40
Figure20.CleanEnergyMinisterialcountrieswindpowercapacity.....................................45
Figure21.SolarPVelectriccapacityinCEMCountries...........................................................46
Figure22.Solarheatcapacityinleadingcountries.................................................................47
Figure23.HydropowerelectricityproductioninCEMcountries............................................49
Figure24.GeothermalelectricityproductioninCEMcountries............................................50
Figure25.Top15countriesusinggeothermalheat,excludingheatpumps,2009................51
Figure26.BioenergyforelectricityproductionCEMcountries...........................................52
Figure27.PublicspendingonrenewableenergyRD&D.........................................................54
Figure28.Globalbiofuelsproductionbytypeoffuel,200010.............................................55
Figure29.IEAbiofuelroadmapsvisionforbiofuelsupply,201050.....................................56
Figure30.Advancedbiofuelproductioncapacity:currentstatuswithplanned
capacityto2015andIEABiofuelroadmapvisionforgrowthto2020and2030....................56
Figure31.PublicspendingonbiofuelsinCEMcountriesin2010..........................................58
Figure32.PassengerLDVsalesbytechnologytypeandscenario..........................................58
Figure33.PHEV/EVmodelintroductions................................................................................59
Figure34.AggregatednationaltargetsforEV/PHEVs............................................................59
Figure35.Lightdutyvehiclefueleconomy............................................................................61
Figure36.Averagefueleconomytrendsthrough2008byregion,withenacted
orproposedtargetsthrough2020..........................................................................................61
Figure37.PublicRD&DspendingonEV/PHEVsandvehicleefficiency
inCEMcountries,2010............................................................................................................63
Figure38.PublicspendingonelectricvehicleRD&Dcategoryfor
selectedcountries200811.....................................................................................................63
Listofboxes
Box1.Windpower:buildingmomentumthroughnationalpolicyleadership.......................16
Box2.Theroleofutilitiesindeliveringenergyefficiency......................................................27

Foreword
Less than three years after fossil fuel prices hit an all time high and the world plunged into its
deepestrecessionsincetheGreatDepression,geopoliticaleventsaredrivingpricessteadilyhigher.
Theshorttermriskstopoliticalstabilityandeconomicactivityposedbytheworldsdependenceon
fossilfuelsareagainasmanifestasitslongtermthreattoenvironmentalsustainability.Tobreak Page|5
this dependency, the world needs a clean energy revolution. Such a revolution would enhance
global energy security, promote enduring economic growth and tackle environmental challenges
such as anthropogenic climate change. It would break the longstanding link between economic
growthandcarbondioxide(CO2)emissionsonceandforall.Buttosucceed,itmustalsobetruly
globalinscope.EvenifcountriesbelongingtotheOrganisationforEconomicCooperationand
Development (OECD) somehow drove their emissions to zero, on todays path emissions from
nonOECDcountrieswouldstillleadtoenvironmentaldisastersonanepicscale.
Such a sweeping revolution will require unprecedented investments in research, development,

demonstration and deployment (RDD&D) of clean, lowcarbon technologies of all sorts for
decadestocome.However,theseinvestmentswillprovideequallyunprecedentedbenefits.The
IEAestimatesaninternalrateofreturnontheinvestmentofabitmorethan10%peryearfrom
the fuel savings alone. The enormous benefits to political and economic stability, as well as to
environmental quality and human wellbeing, that we also expect would add immeasurably to
thisfinancialreturn.
Butissucharevolutionreallypossible?Cansocietiesmobilisethehugeamountsofcapitalneeded
intime?Thegoodnewsisthatthereisalreadyampleevidencethatwhengovernmentsprovidea
sustained strategic framework for a clean energy future, the private sector invests rapidly in
cleantechnologies.Severalcountries,withintheOECDandoutsideofit,havealreadyachieved
tremendouscleanenergydeployment,leadingthewayforotherstofollow.Manygovernments
haveannouncedtargetsforshiftingtheirenergysystemsontoacleaner,moresustainablepath.
However, are announced policies sufficient? Which policies are approaching the rates of
deployment needed? Where are the biggest challenges to our clean energy revolution? To
answersuchquestions,thisreportanalysesforthefirsttimeprogressinglobalcleanenergy
technology deployment against the pathways needed to achieve shared goals for sustainable,
affordable energy. It provides an overview of technology deployment status, key policy
developmentsandpublicspendingonRDD&Dofcleanenergytechnologies.
Wefindthatthepastdecadehasseenadramaticriseinglobalinvestmentinrenewableenergy,
ledbywindandsolar.TherateofenergyefficiencyimprovementinOECDcountriesisstartingto
accelerateagain,aftermanyyearsofmodestgains.Intransport,majorcarcompaniesareadding
hybrid and fullelectric vehicles to their product lines and many governments have launched
planstoencourageconsumerstobuythesevehicles.PublicinvestmentforRD&Dinlowcarbon
technologyreachedanalltimehighin2009.
Unfortunately, the news is not all good. The growth of fossil fuels has matched or even
outpaced that of clean energy globally. We are entering a period of uncertainty for nuclear
power after the natural disasters in Japan. As incomes rise, consumers naturally demand more
productsleadingtoagrowthinpercapitaenergyconsumption.Smarter,moreambitiouspolicies
are clearly needed, ones that build upon the positive examples we have seen in a number of
countries. This report offers a series of recommendations as input to the discussions that will
take place among the ministers attending the second Clean Energy Ministerial (CEM) in Abu
Dhabi. Working together, we still have time to address these recommendations and achieve a
sustainableenergyfuture.Butwemustnotbecomecomplacent;timeisrunningout.
Page|6
NobuoTanaka
IEAExecutiveDirector

Acknowledgements
Tom Kerr coordinated the production of this report, with significant analysis and drafting
supportfromKevinBreen,AntoniaGawelandPaulTepes.WewouldliketothankBoDiczfalusy,
PaoloFrankl,LewFulton,RebeccaGaghen,LisaRyanandPeterTaylorfortheirguidanceandfor
coordinating input from their respective teams. The following colleagues also provided data, Page|7
ideas and/or substantive inputs to sections of the report: Grayson Heffner, Sara Pasquier,
Jungwook Park, Aurelien Sassay, Michael Taylor and Nathalie Trudeau on energy efficiency;
BrendanBeck,KeithBurnard,JuhoLipponenandUweRemmeonefficientcoalandCO2carbon
capture and storage (CCS); Martin Taylor of the OECD Nuclear Energy Association on nuclear
energy; Milou Beerepoot, Hugo Chandler, Zuzana Dobrotkova and Ada Marmion on renewable
energy; Anselm Eisentraut and Michael Waldron on biofuels; Franois Cuenot, Lew Fulton and
TaliTriggonvehicleefficiencyandelectricvehicles;andAlexanderBlackburnandKarenTreanton
on research, development and demonstration spending. Dennis Volk also provided data and
analysisonincrementalelectricitydemand.
This report would not have been possible without the support of the Clean Energy Ministerial
Secretariat, run by the US Department of Energy, who coordinated a data call to collect
informationfromCleanEnergyMinisterialcountries.Manythanksareduetothestatisticiansand
nationalpolicyexpertsthatprovideddata,inputandcommentsinashorttimeframe.Inaddition,
IEAimplementingagreementscontributedinformationanddata,includingColinHendersonand
JohnTopperoftheIEACleanCoalCentreandStuartJeffcottandDavidWellingtonoftheIEA4e
implementingagreement.
MurielCustodio,CorrineHayworth,AnneMayneandMarilynSmithoftheIEACommunications
and Information Office helped to review, edit and format this report. Annette Hardcastle also
providedformattingandreviewsupport.
Keyfindings
Clean energy technologies are making clear progress globally, but fossil fuels continue to
outpace them. More aggressive clean energy policies are required, including the removal of
fossil fuel subsidies and implementation of transparent, predictable and adaptive incentives
forcleaner,moreefficientenergyoptions. Page|9
Thanks to favourable policy support, solar PV and windpower are achieving strong growth.
However,achievingsustainableenergygoalswillrequireadoublingofallrenewableenergy
use by 2020. There are also signs that policy support is weakening due to government
austerity plans. Instead of eliminating successful policies, governments need to put in place
dynamicschemesthatrespondtotechnologymarkets.
Forthepastdecade,coalhasbeenthefastestgrowingglobalenergysource,meeting47%of
new electricity demand. Extensive deployment of CCS is critical to achieve climate change
goals: around 100 largescale projects are needed by 2020, but countries must accelerate
theirpolicyandfundingsupportforthelargescaleCCSdemonstrations.
Progress has been made to transform the market for some key energyefficient products,
including compact fluorescent light bulbs. However, in the buildings and industry sectors,
significantunderinvestmentremains,resultingfromanarrayofmarketfinancial,information,
institutional and technical barriers. Much more policy effort is needed to capture the near
termprofitableandlowcostenergysavingsopportunities.
Biofuelshaveshownsteadygrowth,butstillonlyrepresent3%ofglobalroadtransportfuel
consumption. A sound policy framework is required to ensure the sustainable growth of
biofuelproductionbytenfoldtoreachclimatechangetargetsin2050.Commercialisationof
advanced, sustainable biofuels will be particularly critical to meet targets, and will require
significantexpansionofproductioncapacity.
Electric vehicles are poised to take off. Major economies have announced targets that
together would reach about 7million vehicle sales per year by 2020.If achieved, this will
resultinover20millionelectricvehiclesontheroadbythatyear,takingintoaccountallsales
overthenext9years.However,thiswillonlyaccountforabout2%oflightdutyvehiclestocks
worldwide; continued strong growth after 2020 will be important to ensure market
transformation. Fuel economy of conventional lightduty vehicles has also been improving
recently, but will need to improve faster to achieve a global target of 50% improvement by
2030comparedto2005levels.
While nuclear capacity has remained nearly flat for the past decade, countries are currently
constructing 66 nuclear reactors that should add 60 Gigawatts by 2015. However, the recent
earthquake in Japan and resulting damage have led countries to review nuclear safety and
investmentsacrosstheboard.Asaresult,nuclearexpansionislikelytobeslowerthanplanned.
An increased level of systems thinking is needed to integrate the broad range of individual
clean energy technologies into the energy system. Increased attention and resources are
requiredtoexpandsmartgridpilotprojectsonaregionallevel.
International collaboration is key to ensuring that momentum is maintained and gaps are
addressed. The Clean Energy Ministerial offers an unique opportunity to accelerate
technology deployment through government and corporate pledges and tracking progress
towardsharedglobalenergygoals.
Growthincleanenergyhasbeenstrong...but
needstoexpandandaccelerate
Cleanenergytechnologiescameintotheirownduringthelastdecade.Implementationofenergy
efficiency(EE)measuresisimproving.Renewableenergyhasseen30%to40%growthratesin Page|11
recent years, due to marketcreating policies and cost reductions. Carmakers are releasing the
firstsetofanewwaveofelectricvehicles(EVs)andareattractingcustomers.
Butformidablechallengesremain.Thesedevelopmentsshowthatmanycleanenergytechnologies
aregainingmomentum.However,notallofthenewsisgood.Despitethetremendousgrowthseen
in this sector, demand for traditional fossilbased energy has outpaced demand for clean energy
(Figure1).Toachievethe cleanenergyrevolutionthathasbeencalledfor,thecurrent double
digit growth seen by renewable energy must be sustained for the long term. Energyefficiency
effortsmustprovidetherightincentivesforutilities,industryandconsumerstoinvest,andmust
verify savings through improved monitoring and reporting. Advanced biofuels and electric
vehicles must rampup dramatically. Government funding commitments to largescale
demonstrationsforCCSandsmartgridsmustbeallocated.Inshort,achievingasustainedclean
energypathwayontheglobalscalewillrequiresignificantscaleupandacceleration.
Figure1.IncrementaltotalprimaryenergysupplyinCEMandtheworld,200008
Coal
Oil CEMEurope
CEMPacific
Gas
CEMAsia
Nuclear
CEMAmericas
Hydro
CEMAfrica
Biomassandwaste
Restoftheworld
Otherrenewables
10 0 10 20 30 40 50
EJ
Note:CEMEuropeisDenmark,Finland,France,Germany,Italy,Norway,Spain,SwedenandUnitedKingdom.CEMPacificisAustralia,
Indonesia,JapanandKorea.CEMAsiaisChina,India,RussiaandUnitedArabEmirates.CEMAmericasisBrazil,Canada,Mexicoand
UnitedStates.CEMAfricaisSouthAfrica.
Source:Unlessotherwiseindicated,materialinfiguresandtablesderivefromIEAdataandanalysis.
Table1 includes an updated assessment of the current gaps faced by key clean energy
technologiesintermsofdeploymentrequirementscomparedagainsttheBLUEMapscenarioand
publicinvestmentsinRD&D.
Table1.Recentdeploymentgrowthcomparedwithcleanenergytargets
Required annual growth Blue Map

Technology Current rate Current status
to 2020 target 2020
Biofuel 18% 7% 2.54 EJ 5.04 EJ
Page|12 Biomass power 7% 4% 54 GW 82 GW
Hydropower 5% 2% 980 GW 1219 GW
Solar PV 60% 19% 21 GW 126 GW
Wind power 27% 12% 195 GW 575 GW
Energy intensity of manufacturing -1.30% -0.60% 3.73 MJ 3.81 MJ
Geothermal power 4% 7% 11 GW 21 GW
Nuclear power 3% 4% 430 GW 512 GW
CSP 8% 50% 0.6 GW 42 GW
Electricity generaon with CCS Zero projects 3 GW per year Zero projects 28 GW
Doubling of sales each year
7 million sales
Electric vehicles - from 10 000 EV/PHEV sales in -
in 2020
2011 to reach Blue Map target
Achieving or exceeding levels, maintain the course

Progress but more concerted eort needed
Sizeable gap between deployment and goals
Note: Table compares recent rate of improvement/growth in a technology area against the rate of improvement/growth required to reach the ETP BLUE
Map scenario in 2020. Due to gaps in data, dierent me periods were used. The current rate for wind and biofuels is the annual average growth rate
from 2005 -2010. For solar PV, biomass, geothermal, and CSP this period is 2004-2009. The observed trend in energy intensity is from 2005 2008.
The current rate and status of nuclear includes capacity under construcon up to 2015; the required rate is calculated for 2015 to 2020. Required rates are
measured from the year of the last complete global data set. The Energy intensity is measured in MJ per USD PPP 2009. Biofuel is measured in energy use
from all biofuels in EJ. Electricity generaon with CCS includes generaon from biomass, coal and gas. Assumes 10 000 EV/PHEV sales in 2011.
Source:basedonETP2010BLUEMapscenarioandcountrysubmissions.
Energyefficiency
Energy efficiency is often referred to as an important fuel of the future. By reducing energy
demand, improvements in energy intensity are estimated to deliver 30% of primary energy
consumption.Publicpolicyhassuccessfullytransformedmarketsforanarrayofenergyefficient
products,includingcompactfluorescentlightbulbs(CFLs),refrigerators,motorsandkeybuilding
components. These successes have been delivered by a set of welldesigned and implemented
energyefficiency policies, including building codes, standards and labelling (S&L), energy
certification schemes and utility programmes. Nevertheless, significant underinvestment in
energyefficiencygloballyresultsfromanarrayofmarket,financial,information,institutionaland
technicalbarriers.Moreeffortisneededtoadvanceintegratedbuildingdesignandperformance,
strengthen appliance standards globally in all markets, improve monitoring and verification of
labelling and certification schemes, incentivise utilities to invest more in energy efficiency, and
provideacompetitiveframeworkforindustrytoinvestinthebestavailabletechnology(BAT).

HigherefficiencycoaluseandCCS
For the past decade, coal has been the fastestgrowing energy source, meeting 47% of new
electricitydemandglobally.Thisgrowthhasbeenaccompaniedbyamovetowardmoreefficient,
cleaner coal plants worldwide. However, to meet global climate change goals at lowest cost,
extensivedeploymentofCCSiscritical:around100largescaleCCSprojectsareneededby2020, Page|13
andover3000by2050.Whilethereareover70projectscurrentlyplanned,itisuncertainhow
many of them will be realised. The currently available public funding for largescale
demonstrationprojects(USD25billion)isnotenough.Delaysinfundingdecisionsarecausedby
anumberoffactorsthatgovernmentsmustaddress,includingthehighcostofCCS,lackofpublic
supportforCCS,andaneedforadequateregulatoryframeworksforCO2transportandstorage.
Nuclearpower
While nuclear capacity has remained nearly flat for the past decade, 15 countries are currently
constructing66nuclearreactorsthattogethershouldadd60GWofcapacityby2015;theseand
othercountrieshaveambitiousplanstofurtherexpandglobalnuclearcapacityby2020.However,
the recent earthquake and tsunami in Japan, and the resulting damage to nuclear reactors, will
leadmanycountriestoreviewthesafetyandsitingoftheirexistingandplannednuclearplants.
Asaresult,nuclearexpansionmaybeslowerthanpreviouslyannouncedplanssuggest.
Renewableenergy
Renewable energy market success has been driven by policy support, which has grown
considerablyinthelastdecade.Policiescontinuetoevolvetoaddressmarketdevelopmentsand
reduce costs. In the case of solar energy, at least ten countries now have sizeable domestic
markets. Both utilityscale and rooftop solar photovoltaic (PV) generation have seen a major
scaleup in the past few years, resulting from marketcreating policies that led to an
extraordinarydeclineinthecostofPVmodules.Windpoweralsoexperienceddramaticgrowth
overthelastdecade;globalinstalledcapacityattheendof2010wasaround194GW,upfrom
17GWattheendoftheyear2000.
Despitethisgoodnews,worldwiderenewableelectricitygenerationsince1990grewanaverage
of 2.7% per year, which is less than the 3% growth seen for total electricity generation. While
19.5%ofglobalelectricityin1990wasproducedfromrenewablesources,thissharefellto18.5%
in 2008. This decrease is mainly the result of slow growth of the main renewable source,
hydroelectricpower,inOECDcountries.AchievingthegoalofhalvingglobalenergyrelatedCO2
emissionsby2050willrequireadoubling(fromtodayslevels)ofrenewablegenerationby2020.
Nonhydro renewables will have to increase at doubledigit rates; wind power must see an
annualaveragegrowthrateof17%andsolarpower22%.Whiletheselevelshavebeenexceeded
inthepastfewyears,thislevelofhighgrowthmustbesustainedforthelongterm.
Biofuels
Biofuels have seen steady growth during the last 10 years. Driven by policy support, most
prominently in Brazil and the United States, and more recently in the European Union and
Southeast Asia, global production grew from 16 billion litres in 2000 to more than 100 billion
litres in 2010. Further, many countries are accelerating their investments in advanced biofuels,
withlargescaledemonstrationplantsunderconstructioninmanyregions.Evenwiththisgrowth,
biofuels represented around 3% of global road transport fuel consumption in 2010. To stay on
target,governmentsandindustrywillhavetoensurethelargescaledeploymentofsustainable
biofuels.Morespecifically,forbiofuelstoreachin2050a27%shareintotaltransportfuel,their
productionwillneedtoincreasemorethantenfoldoverthenext40years.1Itwillbeparticularly
important that advanced biofuels reach commercial scale in the next 10 years, with a 30fold
capacityincreaseuntil2030.
Page|14
Electricvehiclesandvehicleefficiency
Major economies have announced targets that together would reach about 7million vehicle
salesperyearby2020.Ifachieved,thiswillresultinover20millionelectricvehiclesontheroad
by that year, taking into account all sales over the next nine years. There has been a strong
growthinthenumberofnewcarmodelsannounced,andmoreimportantly,modelsbeingsold.
Most of the large markets now offer incentives and support schemes to accelerate consumer
adoption.However,vehiclesalesareonlybeginning,andeveniftargetsaremetin2020,thiswill
stillonlyrepresent2%ofvehicles.Itwilltakeevenlongersustainedeffortstoachievesubstantial
impactsonlightdutyvehicle(LDV)energyuseandCO2emissions.Toensuresuccessfulrampup
of EVs, governments must accelerate grid integration through standards development and
programmesthatinvestinrecharginginfrastructure.
Vehicle efficiency continues to improve, with average global new LDV fuel economy reaching
about 8litres per 100km (L/100km). Planned tightening of fuel economy standards in most
majoreconomiesshouldacceleratethistrend.Inordertolockinthelongtermimprovements,
and reach the Global Fuel Economy Initiative (GFEI)2 target of halving new LDV fuel use by
2030,thesestandardsmustbeextendedbeyond2020andothercountriesmustadoptstrong
fueleconomypolicies.

1
ThisisthetargetoftheIEABiofuelsroadmap(forthcoming2011).
2
FormoreinformationabouttheGlobalFuelEconomyInitiative,visitwww.globalfueleconomy.org.

Smarter,moreambitiousstrategiesareneeded
The last decade has seen some renewable energy technologies become competitive with
conventionalenergytechnologies.Mostcleanenergytechnologies,however,stillcostmorethan
incumbentfossilbasedtechnologiesthathavereceived(andcontinuetoreceive)subsidiesfrom
government in the form of tax credits, infrastructure development and funding for largescale Page|15
demonstration. Fossil fuels currently receive USD 312 billion (2009) in consumption subsidies,
versus USD 57 billion (2009) for renewable energy (IEA, 2010g). The competitiveness of clean
energytechnologieslagsbehindfossilbasedtechnologiesduetotheirlevelofmaturity,aswell
as the lack of a price for external environmental impacts, including greenhousegas (GHG)
emissions. Moreover, the deployment of technologies is hampered by noneconomic barriers
suchasadministrativeburdens,gridintegrationissues,lackofawarenessandpublicacceptance
problems. Clean energy technology deployment will therefore require a concerted public and
privatecommitment,supportedbymoreambitiouspolicies.ItisclearthatsettingaCO2pricewill
not be enough to achieve the revolution. Governments need to take action on each of the
followingpolicymeasures:
Increase public investment in innovation through support for research and development
(R&D),aswellaslargescaledemonstration.
Implementsmarterenergypolicies,includingremovingnoneconomicbarriersandproviding
transparent,predictableandadaptiveincentivesforcleaneroptions.
Facilitate the uptake of clean energy technologies into energy systems by supporting
integrationoftechnologiessuchassmartgrids.
Phaseoutsubsidiesforfossilfuels.
EstablishapriceonCO2emissions.
Agrowingbodyofexperienceshowsthatacleanenergyrevolutioncanbeachievedthrougha
comprehensive policy approach. Over the last two decades, several countries have achieved
dramatic changes in their energy markets. A key to success has been to create a strategic,
comprehensiveapproachthatcommunicatestothepublictheenergysecurity,economicgrowth
andenvironmentalbenefitsofcleanenergyinvestment.
Successful national strategies also work with the private sector to identify a set of priority
technologies, and provide a package of coordinated, predictable policies to accelerate
technologydevelopment.Thisinvolvesdesignatingleadinstitutions,providingsustainedfunding
andreducingduplicationbyimprovinglinesofcommunicationandcoordination.Italsorequires
providing smart interventions along the technology development chain from research to
demonstration, largescale integration and market commercialisation, and pulling technologies
intothemarketusingtargetedpolicies(Box1).
Other countries benefit in a number of ways from the success of these pioneering countries:
testingpolicytoolsandapproaches;creatingasmallinitialmarketfortechnologies,whichsetsa
pathforfuturecostreductions;andexportingtheirexpertiseandtechnologytotherestofthe
world. This success required a highlevel political commitment, private sector support and, in
mostcases,asubstantialcommitmentoffundsfromgovernmentsorelectricitycustomers.Inthe
case of renewable electricity, several countries are currently revising policies and tariff rates,
givenunexpectedgrowththathasresultedinescalatingpolicycost.However,itisclearthatby
buildingonthesesuccessfulnationalexamples,countriescanacceleratetechnologylearningand
diffusion,achievecostreductionsandbecomeworldleadersincleanenergytechnologies.
Box1.Windpower:buildingmomentumthroughnationalpolicyleadership
Startinginthelate1980s,Denmarkaimedtoreducefossilfuelimportsandaddressclimate
changeconcernsbydevelopingalocalrenewableenergyindustry,withafocusonbiomass
andwind.Today,nearly20%ofelectricityisproducedfromwind,andDenmarkisoneofthe
Page|16 leading exporters of wind energy technology and expertise around the globe (Figure2).
Energy products and equipment (including wind turbines) accounted for over 11% of total
goodsexportsin2009.Further,DenmarkhasdonethiswhilereducingoilimportsandCO2
emissions.Keyfactorsofthissuccesswere:
Reliablepublicsupportandprivatecommitmenttothegoalsofthetechnologystrategy.
A set of market introduction mechanisms, including loan guarantees for large turbine
export projects and feedin tariffs (FIT) that required utilities to purchase all generated
windenergyataconsistent,abovemarketprice.
Provisionoffinancialincentivesforthepublictobecomesupportersofthewindenergy
economythroughwindcooperatives.
Supporting industry wind R&D by developing guidelines and standards for wind turbines
whileleadingresearchcollaborationontheexplorationandexploitationofwindresources.
Figure2.Danishwindpowercapacitygrowth
4.0 20%
Windcapacity
18%
3.5
Wind/totalelectricity(%)
16%
3.0
14%
2.5
12%
GW
2.0 10%
8%
1.5
6%
1.0
4%
0.5
2%
0.0 0%
1980 1985 1990 1995 2000 2005 2010

Source:GlobalWindEnergyCouncil(GWEC),andDanishEnergyAgency,2010.
In the past decade, India now has the fifthlargest installed wind power capacity in the
world,morethanthreetimestheinstalledcapacityofDenmark(Figure3).AsinDenmark,
thisgrowthwasdrivenbyasetofstablepoliciesandsupportmechanisms,including:
Effective legislation such as Indias Electricity Act of 2003, which requires state energy
regulatory commissions to encourage electricity distributors to procure power from
renewable energy sources; this led the states to develop aggressive renewable energy
targetsandpolicysupportmechanisms.
SupportfordevelopmentofdomesticwindmanufacturingcapabilitythroughSuzlon,an
Indianownedcompanythatholdsover50%oftheIndianwindturbinemarketshareand
hasalsocapturedalargeshareoftheglobalmarket.


Figure3.ChinaandIndiasgrowthinwindpowercapacity
45
India China
40
Page|17
35
30
25
GW
20
15
10
0
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Source:GlobalWindEnergyCouncil(GWEC)andcountrysubmission.
China began installing wind power capacity in 2005, but has since become the worlds
largest domestic wind market, achieving three times the installed capacity in India (or ten
timesthecapacityinDenmark)injustgiveyears(Figure3).AsinDenmarkandIndia,China
createdstrongincentivesanddriversforprivateinvestmentthroughacomprehensivemix
ofsupport,including:
The 11th FiveYear Plan (2006) included renewable energy scaleup to meet growing
electricity demand and achieve energy security and pollution reduction goals. The plan
includednationaltargetsforwind:5GWinstalledin2010;and30GWinstalledin2020.
These targets are implemented by the provinces and by electricity producers through
mandated shares of renewable energy. The policy combines market instruments (e.g.
biddingonconcessionsandmandatedmarketshare)withgovernmentintervention(e.g.
pricecontrolsandtechnologytargets).
SupportforstateownedcompaniestoinvestinwindR&D.
Notably, Chinas central government (through the National Development and Reform
Commission(NDRC))replacedthetendersystem,whichhadgrantedongridpricesthatvaried
significantly. Recognisingthatthebiddingsystemslowtariffswereakeybarriertoprofitable
winddevelopment,theNDRCestablishedinmid2009afixedFIT,differentiatedbyregional
wind resource. As a result of this pragmatic, integrated approach, Chinas installed wind
capacityexceededthe2010targetby320%(ChinaElectricityCouncil,2010).The12thFive
Year Plan (published in late March 2011) will likely contain a further increase of the 2020
targetsabove100GW.
Recommendationsforenergyministers
MaketheCleanEnergyMinisterialaninternationalforumfor
Page|18
commitment,actionandsharedlearning
The reality of the clean energy challenge is such that individual and isolated actions will not
enable the rapid and largescale transition required. Increased collaboration among countries,
stakeholdersandinitiativesthatseektoachievethesharedbenefitsofcleanenergytechnology
deployment is imperative to rapidly scaleup investment, replicate the positive steps that are
being taken, and enhance the costeffectiveness and efficiency of action. Several examples
demonstrate that when one (or more) country sets a pioneering pathway in clean energy
technology development, it increases the potential for domestic scaleup, with associated cost
reductions in the technology. This shared learning needs to accelerate if countries want to
remainontracktorealisethefullpotentialofcleanenergytechnologies.Onestrategywouldbe
to create a forum within the Clean Energy Ministerial for common pledges to develop new
marketsforcleanenergytechnologies.
The Clean Energy Ministerial provides a unique opportunity for governments to translate
dialogue into concrete action, in order to collectively enhance energy technology development
anddeployment.Throughagreementtoasetoffarreachingandambitiousgoals,thisgroupof
key governments can make a significant difference to the global deployment of clean energy
technologies.TheinitialsuccessfulestablishmentoftheCEMprocess,withitsrelatedtechnology
initiatives, is a positive step that clearly demonstrates the shared interest in learning together
andinacceleratingthetransitiontocleanenergy.ThereareanumberofactionsthattheCEM
couldpromote,inclosecollaborationwithexistinginternationaltechnologyinitiatives.3
Cleanenergyministersshould:
UtilisetheregularCEMmeetingstomakesharedgovernmentandcorporatepledgestoinvest
in targeted clean energy technologies, through the launch of new financial mechanisms,
targetedpoliciesand/orprocurement.Trackprogressinfulfillingthesepledges.
Working with the IEA, collect and share data on technology deployment, policy
implementation and investments in clean energy RD&D.4 Initiate discussion among CEM
countries on a common set of data that will be collected on a regular basis, and provide
trainingandothersupporttocountriesthatrequireit.UtiliseCEMmeetingsasanopportunity
to provide updated data on deployment, policy implementation and RD&D investment
therebyprovidingtheevidencebaseforpolicyannouncementsandactivities.
Identify the most promising products and technologies for common standards and develop
projects to map existing harmonisation efforts in specific technology areas; develop
harmonisedapproachesbasedontheseefforts.
Engage the corporate sector on best practices in energy technology RD&D policy and
innovation.CreateamechanismthroughwhichcompaniescanreportRD&Dexpendituresina

3
IncludingtheInternationalLowCarbonTechnologyPlatform,theEuropeanUnionStrategicEnergyTechnologyPlan,anda
numberofothermultilateralandbilateralefforts.
4
Thisreportincludesdatafromthefollowingcountries:Australia,Brazil,Canada,Denmark,Finland,France,Germany,Italy,
Korea, Japan, India (Policies only), Mexico, Norway, Spain, Sweden, UK, USA, UAE. Future data collection efforts need to
expandtoincludeallmajoreconomies.

mannerthatmaintainstheircompetitivenesswhileofferinggovernmentguidanceastogaps
and priorities for government spending. Explore ways to create innovative financing
mechanismsthatreducethecostofcleanenergyfinancing.
Continuetoincreasepublicinvestmentintechnologyinnovation
Page|19
Governmentshaveaclearroleintechnologyinnovation.Technologiesrangingfromrailtransportand
nuclearenergytotheInternetandglobalpositioningsystems(GPS)wereallinventedbygovernment
supported researchers, developed with public funding or first deployed through government
purchasing and incentives. Public investments are needed to train the human capital and build
theenablinginfrastructuresrequiredforthewidespreaddeploymentofmanytechnologies.
In 2009, governments recognised that clean energy is a driving force for economic recovery. A
numberofmajoreconomiesinvestedrecentstimulusfundsincleanenergyRD&Dprojectssuch
as highspeed rail, CCS demonstration projects and smart grid pilot projects. As a result, public
sectorenergyRD&Din2009rosetoitshighestlevelever,eclipsingthe previoushighachieved
duringtheoilcrisisofthe1970s.AnnualglobalpublicRD&DspendingonenergyinCEMcountries
now exceeds USD21 billion. This is likely the minimum level needed to achieve the rate of
technology deployment required to attain climate change targets (IEA, 2010c). However,
indicationsfor2010showthatspendinglevelsonceagaindroppedmarkingtheendofstimulus
spendingandwerecloserto2008levels.
Toachievethenecessarycleanenergytargets,higherspendinglevelsmustbesustainedoverthe
longtermandspendingprioritiesneedtoshift.Duringthelastdecade,countriesspentUSD56
billiononnuclearenergyresearchandUSD22billiononfossilresearch,butonlyUSD17billion
onrenewableenergyandenergyefficiencyresearchcombined.
Realigngovernmentsubsidiesforfossilfuelstosupportcleanenergy.
Use market mechanisms, such as carbon taxes or proceeds from GHG auctions, to generate
dedicatedfundingforRD&D.
Provide incentives for greater private sector investment in clean energy through tax credits
andmarketcreatingmechanisms,andthroughinnovativepublic/privatepartnerships.
Toaddresstheimpactofcontinuedfossilfueluse,provideimmediateallocationofannounced
fundsforlargescaleCCSdemonstrationprojects.
Unleashthepotentialofenergyefficiency
Global energy intensity is improving but leaves no room for complacency; much costeffective
energyefficientpotentialisnotyettappedandenergydemandisgrowing.Energyefficiencycan
andshouldbeimprovedacrossallsectors.Carbonpricesareessentialbutwillnotaloneaddress
allthebarrierstoenergyefficiency,otherpoliciestargetingenergyefficiencyareneeded.
Develop policy packages that target energyefficiency actions in all sectors and strive for
sustainedefficiencyimprovements.
UsetheCEMprocesstotrackanddelivermoredetaileddataonenergyefficiencytechnology
deploymentandRD&Dspendingtoidentifyprioritiesforactionandcollaboration.
UsetheCEMprocesstoidentifysignificantendusetechnologyareasasprioritiesforimproved
energyefficiency market transformation, including domestic cold appliances, domestic
lighting,electricmotors,airconditionersandnetworkstandbypower,amongothers.
Sustainthemomentumofinnovationinrenewableenergy
Page|20
Several countries have successfully triggered the sustainable, largescale deployment of
renewable energy technologies. This success has been the result of smart support policies that
theseleadingcountrieshavedevelopedandapplied.Theirexperiencepointstoanumberofkey
design principles that policy makers should follow to arrive at investment grade policies. If
policy makers adhere to these basic design principles, the vast potential renewable energy
technologieshavetomeetglobalenergyneedscanbeunlocked.
Removenoneconomicbarriers,suchasadministrativehurdles,obstaclestogridaccess,poor
electricitymarketdesign,lackofinformationandtraining,andsocialacceptanceissues.
Developadaptive,predictableandtransparentsupportframeworkstoattractinvestment.
Developandimplementtransitionalincentivesguaranteeingspecificbutdecreasinglevels
of support as different technologies advance in their degree maturity and move towards
marketcompetitiveness.
Give due consideration to the impact of largescale penetration of renewable energy
technologies on the overall energy system, especially in liberalised energy markets, with
regardtooverallcostefficiencyandsystemreliability.
Expandtheuseofrenewableenergyforoffgridandminigridapplications.
Ensuresynergieswithclimatechangepolicyframeworks.
Fosterelectricvehiclemarketintroduction
InorderforEVstosucceed,governmentsmustmakecommitmentstobuildingsustainedmarkets
thatlastforatleastthe next10years.Thisshouldincludepriceincentivesforconsumers(and
adequateandstablefundingtopayfortheseincentivesoveratleastthenext5years,followed
byaphaseoutperiod);supportforconstructionofadequaterecharginginfrastructure;working
with cities to ensure cohesive regional and national systems; funding for RD&D, including pilot
programmesandconsumereducationcampaigns.
Ensurethatsufficientrecharginginfrastructureisputinplacenotonlyfortheinitialwaveof
vehicles (e.g. a few thousand within a country, through 2012) but also the second phase of
marketrampup(e.g.potentiallyuptohundredsofthousandsorevenafewmillionvehicles,
through201520).
Send clear signals that vehicle price incentive support will not suddenly disappear. At the
sametime,governmentsneedtoavoidexposuretolargepotentialsubsidycosts.Oneoption
is to allocate an annual limit on incentive expenditures, and keep that amount each year
through 2020, reducing the amount per vehicle as sales rise. This has the benefit of
automaticallyloweringthesupportlevelpervehicleassalesincrease.

Developintegratedcleanenergysystems
Theyear2000markedanimportanthistoricalmoment,astheshareofglobalpopulationlivingin
urban environments surpassed 50%. This proportion will continue to grow over the next few
decades. The energy infrastructures on which communities depend will therefore need to be
adapted and upgraded to meet increasing demands for energy services. This provides the Page|21
opportunity for local government leaders to encourage increased deployment of clean energy
systemsandgainthebenefitsthattheyoffer.
The development of smart grids is an essential step to enable and integrate the clean energy
technologies needed to support demand, supply and transport. Smart grids are needed to
providetheinformationandtoolstoallowelectricityconsumerstodecreasecostsandincrease
efficiencyofenergyuse.Severalconceptsareemergingthatextendthereachofthesmartgrids
from electricity systems to broader energy and societal contexts. One of these is the smart
communityorsmartcity.
Asmartcommunityintegratesenergysupplyandusesystemswithinagivenregioninanattempt
tooptimiseoperationthroughcustomerenergymanagementwhilealsoallowingformaximum
integration of renewable energy resources, from largescale wind farms to microscale rooftop
PVsystems.Smartcommunitiesincludeexistinginfrastructuresystems,suchaselectricity,water,
transportation,gas,wasteandheat,aswellasfuturesystemssuchashydrogenandEVcharging.
The goals of such integration through the use of information and communication technology
(ICT)includeincreasedsustainability,securityandreliability,aswellassocietalbenefitssuchas
betterservices,reducedcapitalinvestmentandjobcreation(IEA,2011c).
Commit to scaleup existing smallscale smart grid pilot efforts to carry out several regional
largescale and systemwide demonstrations that identify technology, regulatory and
customersolutions.
Provide assistance to local governments to develop tailored approaches that engage and
educate energy customers by supporting technologies, developing regulations and helping
industrytocreatebusinessmodelsforsmartgridsrollout.
Cleanenergyprogressreport
The BLUE Map scenario sets a goal of halving global energyrelated CO2 emissions by 2050
(comparedto2005levels)andsetsouttheleastcostpathwaytoachievethatgoalthroughthe
deploymentofexistinglowcarbontechnologies(Figure4).Thiscanserveasavisionforshared
Page|22 global goals to reduce GHG emissions while enhancing energy security and advancing
economicgrowth.
Figure4.KeytechnologiesforreducingCO2emissionsundertheBLUEMapscenario,2010
60
Baselineemissions57Gt CCS19%
55
50 Renewables17%
45
Nuclear6%
40
GtCO2
35 Powergenerationefficiencyand
30 fuelswitching5%
Endusefuelswitching15%
25
20 Endusefuelandelectricity
15 efficiency38%
BLUEMapemissions14Gt
10
5
WEO2009450ppm case ETP2010 analysis
0
2010 2015 2020 2025 2030 2035 2040 2045 2050
The BLUE Map scenario, together with IEA technology roadmaps, provides clear pathways for
deploying clean energy technologies. These can be compared against current deployment, as
reportedinIEAstatisticsandindatacollectedfromcountriesthatparticipateintheCEMprocess,
thereby providing a preliminary assessment of global progress toward the clean energy
transition. The following section provides a more indepth discussion of deployment status,
policy implementation and public spending on RD&D for six categories of clean energy
technologies: energy efficiency; higherefficiency coal use and CCS; nuclear power; renewable
energy;biofuels;andEVsandvehicleefficiency.
Energyefficiency
Sincetheearly1970s,globalenergyintensityhasimprovedatanaveragerateof1.7%peryear,
butthisimprovementmustbemeasuredagainstoverallincreasesinCO2emissionsandenergy
consumption resulting from economic growth. Without energyefficiency improvements, final
energyusein2006wouldhavebeen63%higherintheOECD11thanitwasintheearly1970s
(IEA,2010d). It has been estimated that global savings from energy productivity improvements
was 3.6 gigatonnes of oil equivalent (Gtoe) in 2008, or almost 30% of primary energy
consumption (WEC, 2010). However, energy efficiencys potential has barely been tapped. The
economic crisis and resulting stimulus programmes, as well as rising fuel costs, have acted as
strong drivers of recent energy efficiency, yet these are offset by increased consumer demand
andwillingnesstoinvestandlendintimesofeconomicrecession.

Underinvestment in energyefficiency results from an array of market, financial, information,

institutionalandtechnicalbarriers;carbonpricingalonewillnotbeenoughtoovercomethese.
The IEA has developed 25 policy recommendations to help governments achieve the full
potentialofenergyefficiencyimprovementsacrossallenergyconsumingsectors.Ifimplemented
globallywithoutdelay,proposedactionscouldcumulativelysavearound7.3gigatonnes (Gt)of
CO2/yearby2030(Figure5). Page|23
Figure5.EstimateofpotentialCO2emissionssavingsthroughimplementationofIEA25energy
efficiencypolicyrecommendations
40
Baselineemissions40Gt
Buildings25%
38 Appliances10%
Lighting4%
36
GtCO2
Transport29%
34 Industry32%
32
30
28
2010 2015 2020 2025 2030
The consolidated set of recommendations covers seven priority areas: crosssectoral activity,
buildings,appliances,lighting,transport,industryandpowerutilities.The2009progressreport
showedthatIEAmembercountrieshadimplemented57%ofthe25IEAenergyefficiencypolicy
recommendations(IEA,2010d).Nosinglepolicycanovercometheenergyefficiencygap.Policies
are required in all sectors to achieve significant improvements in energy efficiency. Effective
approaches that reflect the diffuse and incremental nature of energyefficiency actions are
needed.Policiesalsoneedtoincludeasystemicratherthanindividualcomponentapproach.This
sectionprovidesasnapshotoftheenergyefficiencylandscapeacrosskeyconsumingsectorsand
enduses, highlighting key technologies, policy developments in CEM countries, and RD&D
spendingtrends.5
Energyefficientbuildingsdeployment
Theenergyconsumptionofthebuildingssectorisprojectedtogrowfrom2759Mtoe(2007)to
over4400Mtoeby2050,withmorethanhalfofthisconsumptioninresidentialbuildingsanda
significant increase of the nonOECD countries share of the total energy consumption in the
buildings sector (IEA, 2010a). Deep cuts in building energy consumption are achievable by
implementing stringent requirements for both new and existing buildings and deploying the
existing technologies on a global scale. Achieving significant energy reduction in the buildings
sector is feasible with existing technologies if the investment costs are lowered and efficient
designsareemployedinanintegratedway.However,inordertoreduceenergyconsumptionof
thebuildingssectortothelevelsthatareneededforthelongerterm,newbuildingswillneedto
5
Vehicleefficiencyiscoveredseparatelyinthelastsectionofthisreport.
be zeroenergy and deep renovation of existing buildings will be required. Therefore, the
challenge for the next decades is to put in place policies that target improvements in the
technicalefficiencyofbuildingcomponentsaswellasefficiencyimprovementsinthedesignof
thenewbuildingsandthedesignofsystems,especiallyheating,ventilationandcoolingsystems.
During the last three decades, improvement has been made on the energy performance of
Page|24 insulatingmaterialandwindows;keycomponentsoftheenergyefficiencyofthebuildingshell.
Most IEA member countries now use highperformance insulating materials; double glazing
windows are becoming standard. The increase of the sales of highperforming windows and
insulatingmaterialsshowthepositivestepsthatarebeingtakentoensureimprovedefficiencyof
buildingsenvelopeandshelltechnologies.
Policydevelopments
Majoreconomiesuseavarietyofpoliciestomaketheirbuildingsmoreenergyefficient,including
building codes, building certification and standards and labels (S&L) for buildings and building
components. However, these policies lack verification of the performance in the field. Building
codes that include energyefficiency standards for new buildings are used in all IEA member
countries.ManyCEMcountrieshaveintroducedminimumenergyrequirementsfornewbuildings,
with 13 IEA countries including mandatory energyefficiency requirements in codes for new
buildings,aswellastheUAEandIndia.Buildingcodestandardstringencyvarieswidely.TheUnited
Kingdomsminimumenergyperformancestandards(MEPS)forbuildingsaresettotightensothat,
by2016,allnewdwellingswillbezerocarbon.Germanyscurrentstrongefficiencystandardsare
expectedtoberaised30%in2012.Denmarkalsohasstrongrequirementsthatwillriseby2015.
Oncetheseamendmentsareinforce,itisexpectedthatGermanysandDenmarksbuildingcodes
for new buildings will be close to the level of stringency recommended by the IEA. Other
countriesincludingtheNetherlandsaremovingtoimplementmoreambitiousrequirements.
In the case of existing buildings, many CEM countries have introduced energy certification
schemes that analyse energy use and recommend improvements. Eight IEA member countries
have successfully implemented mandatory certification schemes for buildings. There are also
severalvoluntarycertificationschemes.Anumberofnationsalsoimplementvoluntarystandards
andlabellingschemesandenergyrequirementswindows.6
Deploymentofenergyefficienthouseholdappliances
The use of electricity by appliances in IEA countries grew by 53% over the period 19902006,
accountingfor15%oftotalelectricityconsumption(IEA,2010d).Inallcountrieselectricityuseby
household appliances e.g., refrigerators, air conditioners, washing machines, stoves is
forecast to rise, and particularly in emerging markets. A key issue will be strengthening and
broadeningtheappliancestandardsandlabellingprogrammesincountriesthatmanufactureand
importtheseappliances.
Householdappliancesrepresentthebestexampleofhowgovernmentpoliciesandpublicprivate
partnershipscantransformconsumerpurchasingofenergyconsumingequipment.Inthecaseof
refrigerators,energyconsumptionhassteadilyimprovedwhilepurchasepriceshavedecreased.
Figure6 shows the increased efficiency for new refrigerator/freezer combination units in each
country,resultingfromimprovedproductperformance.

6
Additionaldetailsonnationalenergyefficiencypolicyimplementationcanbefoundatwww.iea.org/textbase/pm/?mode=pm

Figure6.Changeinenergyefficiencyofnewrefrigerator/freezercombinationunitsinselectcountries
1.8
SalesWeightedkWh/AdjustedVolume
1.6 Australia
Canada
Page|25
normalizedto2007
1.4 China
Korea
1.2 UnitedKingdom
UnitedStates
1.0
EuropeanUnion
0.8
1996 1998 2000 2002 2004 2006 2008 2010
Note:Thisdatahasbeennormalisedto2007tohighlightthetrend.USdatapriorto2005isestimated.
Source:IEA4EImplementingAgreementandcountrysubmissions.
Thesetrendsinefficiencyimprovementsare,however,offsetincreasedglobalsalesandresulting
energydemand.
Policydevelopments
Major economies actively implement energyefficiency policies for appliances, with 73% of CEM
countries implementing MEPS and labelling for a growing list of appliances. Over 50 nations
implement enduse equipment programmes which seek to improve energy efficiency for electrical
appliances and equipment in the residential, commercial and industrial sectors (CLASP, 2010).
Productenergylabelingtakesoneoftwoformsendorsementlabeling,suchastheUSENERGYSTAR
label,andcomparativelabeling,asfoundinAustralia,KoreaandtheEU.Governmentstandardsand
labelling programmes have transformed the market for many appliances by increasing their
functionality and efficiency while reducing unit cost. However, noncompliance is a major factor
which limits S&L programmes in achieving their potential energy efficiency. Better monitoring,
verification and enforcement (MVE) of S&L programmes is needed. International coordination
andcollaborationcanassistinloweringthecostsofsuchprogrammes(IEA,2010f).
Energyefficientlightingdeployment
Lightingisoneofthemainenergyconsumingsectors,consumingafifthofglobalelectricity.For
most of the 20th century, incandescent light bulbs were the only costeffective technology to
provide artificial indoor lighting. However, since the early 2000s the production costs of more
efficienttechnologiessuchasCFLsdropped,makingthemacosteffectivealternative.Inrecent
yearstherehasbeenarapidincreaseinglobalCFLsales.Between2000and2007,theaverage
growthrateinIEAcountrieswas34%,22%inChina,23%inLatinAmerica,33%inEasternEurope
and 26% in Asia Pacific (Figure7). China is now not only the dominant producer but is also
comfortably the largest single market, accounting for sales of about 1 billion lamps in 2007.
Another1.5billionlampsaresoldintherestoftheworld.Thesesalestrendsillustratethatthe
lastdecadehasseenaglobalmarkettransformationinlighting.(IEA,2010e).
Figure7.EstimatedCFLsalesbyregion
Page|26
In addition, more efficient lighting technologies are becoming available, namely solid state
lighting(SSL)technologiessuchaslightemittingdiodes(LEDs).Potentialimprovementsholdthe
promise of more costeffective energy savings in the lighting sector after the phaseout of
incandescentlightsiscomplete.
Policydevelopment
The high purchase cost held back the market penetration of CFLs initially. To overcome this
marketbarrier,almostallmajoreconomieshaveintroducedMEPSforlampswhichhavehadthe
effectofabanonincandescentlights.Examplesofthesepoliciesinclude:
EuropeanUnion:progressivephaseoutofincandescentlightbulbsfrom2009to2012.
Japan:progressivephaseoutofincandescentlightbulbsto2012.
Brazil:progressivephaseoutofincandescentlightbulbsstartingin2010.
Canada, Australia, Korea and Switzerland have also announced a policy of phasing out
incandescent lamps; China and India are considering a phaseout. To realise the full potential
energysavingsresultingfromtheswitchtoenergyefficientCFLs,thephaseoutpoliciespassed
worldwideneedtobeenforcedinthecomingyears.

Box2.Theroleofutilitiesindeliveringenergyefficiency
Energyprovidershavedistinctadvantagesindeliveringenergyefficiencyimprovementsforarangeof
residential, commercial and industrial customers. They enjoy ready access to capital, an existing
relationship with end users, extensive information about customers and markets, a familiar brand
name, and a readymade service network within their jurisdiction. Utilities play a major role in Page|27
delivering energy efficiency in many IEA member countries. For example, in 2008 utilitydelivered
energyefficiencyprogrammesintheUnitedStatesandCanadasaved105TWhofelectricityandmore
than367millionthermsofgas,reducingGHGemissionsbyanestimated.06GtofCO2(ACEEE,2010).
Policydevelopments
Certain enabling conditions are needed before energy providers can embrace the role of energy
efficiency implementer, namely the ability to recover programme costs, compensation of foregone
revenuesowingtolowersales,andacceptablelevelsofregulatoryandotherrisk.Establishingthese
conditionsrequirestailoredinstitutional,regulatoryandmarketmechanisms.Iftheenergyprovider
isaforprofitbutregulatedentity,theremustbeamechanismtoadjustpricesorratesinorderto
recoverprogrammecostsandmakeaprofit.Forretailenergyprovidersoperatinginfullycompetitive
markets,obligationstodelivercarbonemissionsreductionsorenergysavingshaveprovedeffective.
Stateowned energy providers will need other enabling conditions depending on organisation,
autonomyandfundingneeds.
These enabling conditions have been achieved in many jurisdictions, notably In North America and
parts of Europe, where energy providers play a central role in the funding and implementation of
energy efficiency. Recent studies on ratepayerfunded energyefficiency programmes for gas and
electricityintheUnitedStatesandCanadaput2009spendingatUSD6.1billionandforecastthatUS
spendingalonewouldtopUSD10billionby2015(BarboseandGoldman,2009)(CEE,2010).Insome
US jurisdictions, utilities spend as much as 3% of collected revenue on energy efficiency. Utilities in
Brazilcollect1%ofelectricityrevenues,whichisusedtofundEEprogrammesaswellasR&D.Inthe
United Kingdom, energy provider spending on energy efficiency is about USD3billion under the
Carbon Emissions Reduction Target (CERT) supplier obligation. This obligation has a target CO2
emissionsreductionof0.19Gtbetween200812(EnergySavingsTrust,2009).TheFrenchandItalian
White Certificates programmes, which give energy providers the choice between implementing
energyefficiency programmes and purchasing energyefficiency offsets in a secondary market,
togetheraccountforaboutUSD700millioninannualspendingonenergyefficiency.
Thesuccessofprogrammesandpoliciesthatmobiliseenergyproviderstodeliverenergyefficiency
has led to increased interest in this sector. Most recently, the 2011 the EU EnergyEfficiency Plan
proposes legislation that will oblige energy regulators and energy companies to take steps that
enabletheircustomerstocuttheirenergyconsumption.Thiscouldtaketheformofobligationsto
cutcustomerenergyconsumption,asiscurrentlythecaseintheUnitedKingdom,orrequirementsto
implement certain types of efficiency investment programmes, either directly or through Energy
ServiceCompanies(EC,2011).
Energyefficiencydeploymentinindustry
Between 1990 and 2006, the overall energy efficiency of manufacturing industry in 21 IEA
membercountriesimprovedby1.6%peryear.Withouttheenergysavingsresultingfromthese
improvements, manufacturing energy consumption in the IEA would have been 21% higher in
2006.Thisrepresentsanannualenergysavingof9.5exajoules(EJ)in2006,equivalenttoalmost
600MtCO2emissionsavoided.Theeffectofthesesavingsissignificant:despitea45%increasein
output,finalenergyinthemanufacturingsectordecreasedby0.6%between1990and2006.The
rate of improvement in energy efficiency during this period was much lower than in previous
decades. However, there are indications that the rate of improvement has accelerated in the
recent past. Both process and individual component energy efficiency are important in
determining the energy intensity of industry. Across all industrial sectors electric motordriven
systems(EMDS)haveanimportantroleintheenergyefficiencyofthesystem.
TheIEABLUEMapscenarioestimatesthatindustrialenergyintensitywillincreaseinthenextfew
years,peakbetween2015and2020,andthenstartdecreasing.Inreality,globalenergyintensity
Page|28 ofthemanufacturingindustryhasdecreased1.3%peryearsince2005andisasignthatcountries
maybeontracktoachievelongertermclimatechangegoals(Figure8).However,thistrendmay
hide important fluctuations that are caused by factors beyond energy efficiency, including the
200809economicrecession.
Figure8.CurrenttrendinglobalmanufacturingenergyintensitycomparedtoBaselineandBLUE
Mapscenarios
4.7
4.5
MJperUSDPPP2009
4.3
ETP2010Baseline
4.1
ETP2010BlueMap
3.9
3.7 Currenttrend
3.5
2005 2010 2015 2020

Deploymentofelectricmotordrivensystems
Electric motordriven systems comprise the largest single end use in the industrial sector,
consuming more than 40% of electricity consumption. They are fundamental components and
theirapplicationrangeswidelyinsystemsasvariedaslargeindustrialequipmentandprocesses
tosmallhouseholdappliances.Themarketshareofmoreefficientmotorshasbeenincreasingin
manyregionsandcountries.Aleastlifecyclecost(LLCC)savingspotentialexistsof20%to30%,
accountingfor10%ofglobalelectricityconsumption,usingBAT(IEA,2011b).
Policydevelopments
Even though energy costs typically account for over 95% of an electric motors lifecycle cost,
mostcompaniesorganisationalstructuresseparateequipmentprocurementfromoperationand
maintenance,givinglittlereasontolookbeyondthelowestpurchaseprice.Alackofawareness
among motor purchasers of the potential savings from using more efficient motors is another
barriertouptakeofmoreefficientmotors.Onewaytoovercomethisistointroducemandatory
minimum energy performance standards (MEPS). The United States and Canada are leaders in
settingmotorenergyefficiencystandards,astheyintroducedMEPSregulationsformotorsinthe
late 1990s followed by many countries such as China, Australia, Korea, Brazil, Mexico, and

Taiwan. The European Union also passed MEPS legislation for electric motors in 2009 as an
implementing measure under the Ecodesign Directive. India, Japan and Russia have not yet
adopted MEPS, but are currently considering their implementation. Global cooperation will be
important for motors, as they are among the most highly traded goods and many motors are
integrated into equipment before being sold. Recently the the International Electrotechnical
Commission (IEC) completed the task of aligning the existing national and regional efficiency Page|29
classificationforelectricmotors.Globalcooperationisneededtoacceleratesimilaralignmentin
regulationssuchasMEPSforelectricmotors.
Energyefficiencydeploymentinenergyintensivesectors
The rapid expansion of production capacity has generally had a positive effect on the energy
efficiencyoftheironandsteelindustry.Additionalcapacityhasreducedtheaverageageofthe
capitalstock.Newplantstendtobemoreenergyefficientthanoldplants,althoughnotallnew
plants have introduced BAT. Energyefficiency equipment has been retrofitted to existing
furnaces and ambitious energyefficiency policies have led to the early closure of inefficient
plants in several countries. The decrease in steel demand (and production) resulted in a lower
capacityutilisationoftheplants;whichinturnresultedinlossofeconomiesofscales.Theiron
andsteelindustrywasontracktoachievetheoutcomesoutlineintheBLUEMapscenariountil
2007.However,therecenteconomiccrisishashadanoticeableimpact:thesectorsintensityin
2008increasedtotheBaselinelevelforCEMcountries.
The thermal energy consumption of the cement industry is strongly linked to the type of kiln
used.Verticalshaftkilns,ofwhichtherearethreemaintypes,consumebetween4.8GJ/tand6.7
GJ/tclinker.Theintensityofwetkilnsvariesbetween5.9GJ/tand6.7GJ/tclinker.Thelongdry
process requires around 4.6 GJ/t clinker, whereas adding preheaters and precalciners further
reduces the energy requirement to between 2.9 GJ/t and 3.5 GJ/t clinker. Since 1990, dry
technologieshaveexhibitedamarkedincreaseinalltheregionsforwhichdataareavailable.
Asintheironandsteelsector,thecementindustrywasalsogreatlyimpactedbytheeconomic
downturn.Initialassessmentsfor2008indicatethatwhileintensityincreasedbymorethan5%,
thesectorsintensityisstillontrackwiththeBLUEMapscenario.
Itisdifficulttomeasurethephysicalproductionoftheorganicchemicalindustrygiventhelarge
number of products. Polymer production represents both the largest and the fastestgrowing
segment of the chemical and petrochemical sector, representing approximately 75% of the total
physicalproductionandrisingnearly6%peryeartoapproximately300Mtin2006(PlasticsEurope,
2008; SRI Consulting, 2008). While growth has levelled off in industrialised countries, polymer
production in China and some other emerging economies has continued to increase rapidly.
However, worldwide growth has been negatively affected by the recent economic turmoil. Data
thatareavailableto2007forCEMcountriesshowthatwhileenergyintensityhasbeenatthelevel
oftheBaselineScenario,therearesignsthatthesectorisslowlymovingintherightdirection.
Themainproductionfacilitiesforthepulpandpapersectorarepulpmillsandintegratedpaper
andpulpmills.Mostofthesectorsefficiencyimprovementshavecomefromintegratedpulpand
paper mills that use recovered heat in the production process. Additionally, the production of
recovered paper pulp uses 10 GJ to 13 GJ less energy per tonne than the production of virgin
pulp.Currentlevelsofrecoveredpaperproductionvaryfrom30%intheRussianFederationto
over60%inJapanandGermany.Recyclingratescanbeincreasedinmostregions,especiallyin
manynonOECDcountrieswheretherecoveredpaperproductionratevariesfrom10%to50%.
Theuppertechnicallimittowastepapercollectionisover80%(CEPI,2006),butpracticallythe
upperlimitmaybecloserto60%.PulpandpapermillsintheCEMcountrieshavedramatically
improved their energy intensity since 2005, improving by 1.2% per year. Globally, the sector
achieveda1.8%peryearimprovement.
Policydevelopments
Page|30
Many countries have introduced tax and other fiscal incentives to encourage energyintensive
sectorstopurchaseefficientequipment.Manycountriesprovidelistsofeligibleenergyefficient
equipment which act as an information or benchmarking tool for company or public sector
procurement(IEA,2011a).Inaddition,severalnationsareexpandingtheirpromotionofenergy
management in industry by providing energy management tools, training, energy manager
certification and quality assurance. Nevertheless, with under half of the CEM countries
implementing energy management support programmes, significant room for improvement
remains.Sinceaglobalcarbonmarketisnotimminent,internationalagreementscoveringsome
ofthemainenergyintensiveindustrialsectorsisatransitionalsteptosecuresectoralreductions
inenergyconsumption.
Publicspendingonresearch,developmentanddemonstrationfor
energyefficiencyinbuildingsandindustry
Energyefficiencyinindustryencompassestechniquesandprocessesaswellasindustrialequipment
andsystemsinmanufacturing,constructionandminingindustries.Energyefficiencyinthebuildings
sector comprises advanced design and buildings envelope components, building equipment and
operationsystems,appliancesandlightingaswellasheating,coolingandventilationtechnologies.7
Figure9.Publicspendingonenergyefficiencyinbuildingsandindustry
a) CEM countries annual spending, 2010 b) IEA countries cumulative spending, 2005-10
250 EEtotal 400
1433
EEindustry
791
748
599
350
200 EEbuildings
300
MillionUSD2010
MillionUSD2010
250
150
200
100
150
100
50
50
0 0

Notes:Chinais2008data,FranceandRussiais2009data.DataforIndiaarefromtheOfficeofthePrincipalScientificAdvisertothe
GovernmentofIndia;amountsareestimatedonayearlybasisasonefifthoftotalbudgets.
Source:Countrysubmissions,Kempeneretal.,2010
Between2005and2010,theUnitedStatesandJapanspentmoreonenergyefficiencyRD&Dthan
mostothermajoreconomies,followedbyItaly,FinlandandKorea(Figure9b).Japanhasthelargest
budget for energy efficiency in buildings and industry with fairly equal shares between the two

7
SolarheatingandcoolingisincludedinrenewableenergyRD&D.

sectors in 2010, although spending has steadily declined since 2001. Data were not available for
largeemergingeconomiesotherthanRussia,whichspentUSD120millionbetween2007and2009,
splitevenlybetweenindustryandbuildingsefficiency.Figure9aidentifiesCEMcountryspendingin
2010,basedonIEAstatisticsandcountrydatasubmissions.Figure9bcomparesselectIEAmember
countries spending between 2005 and 2010, showing that most countries do not split spending
evenly between buildings and industry. Korea and Finland spend much higher amounts on energy Page|31
efficiencyinindustry,theUnitedStates,ItalyandFrancespendmoreonbuildings.TheUnitedKingdom
spentslightlylessthanUSD16milliononenergyefficiencyinindustryduringthistimeperiod.
HigherefficiencycoaluseandCCS
Theworldcontinuestorelyheavilyoncoalasanenergysource;forthepastdecade,coalhasmet
47%ofnewelectricitydemandglobally(Figure10).Thereisalsoagrowingdifferencebetween
the use of coal for power generation between OECD and nonOECD regions. Though
contributions from hydropower, nuclear and natural gas use are increasing, growth in energy
demandinthesecountriesislargelybeingfedbycoal.Bycontrast,inOECDcountriesnewpower
demandisbeingmetbynaturalgasandnewrenewableenergy,especiallywindpower;andcoal
iscontributingsubstantiallyless.
Figure10.Worldincrementalgrowthinelectricitygeneration,200008
4788
4900
4400
3900
3400
TWh
2900
2258
2400
1900 1573
1400
900 589
312
400 140
74
100
Gas Coal Oil Nuclear Hydro Renewables Total
andwaste
Note:Renewablesandwastecategoryexcludeshydropower
IntheBlueMapscenariotheamountofrelativelylessefficientsubcriticalcoalcapacitybeginsto
decline between 2010 and 2015 and the share of supercritical, ultra supercritical and combined
heatandpower(CHP)plantsincreases.Thisprocesshasalreadybegun.Chinahasbegunthephase
outofsubcriticalplantsandallnewconstructionissupercriticalorultrasupercritical.Between2010
and2015itisestimatedthataround250GWofsupercriticalandultrasupercriticalcapacitywillbe
installedinCEMcountriesalone.In2008,whereascoalaccountedfor41%oftotalgeneration,it
produced73%ofpowerrelatedCO2emissions.Thoughmorerecentlyconstructedcoalplantsare
highly efficient, even the best plants emit more than 750gCO2/kWh. And globally, the average
coalfiredpowerplantemitsalittleover1000gCO2/kWh,ormorethan1MtCO2/TWh.
Forthisreason,raisingtheefficiencyofexistingandnewcoalfiredplantsisimportant.Switching
tolesscarbonintensivefuels(e.g.fromcoaltonaturalgas)andimprovingtheefficiencyofcoal
plantswillachievesignificantreductionsinCO2andshouldbeatoppriority.However,improving
efficiencyalonewillnotmeetthereductionsneededtosatisfytheBLUEMapscenario.Fordeep
cutsinemissionsatlowestoverallcost,CCSmustbedeployed.Asaresultoftheadditionalenergy
requirementsofCCS,improvingtheefficiencyofexistingcoalfiredpowerplantsandensuringthat
newplantsmeetshighefficiencystandardswillbeacriticalfirststeptodeployment.
Page|32 Highefficiencycoaldeploymentstatusandpolicydevelopments
Thelastdecadesgrowthincoalusehasbeendrivenbyamovetowardmoreefficient,cleanercoal
plants. New plant construction is generally based on the latest, most efficient technology. The
oldest,leastefficientplantsarebeingphasedoutofoperationandremaining,inefficientplantsare
systematically being upgraded, with aging components replaced and more effective operational
practicesintroduced.ThemajorityofcoalfiredgenerationcapacityinChinaislessthan10years
old,whileintheUnitedStatesandEurope,mostofthefleetisbetween31to40yearsold(IEACCC,
2011).Chinahasbeenroutinelyclosingdownold,inefficientcoalfiredplants(lessthan200GW
capacity)andreplacingthemwithmodern,efficienttechnology,forexample,in2010,morethan
11GWofsmallplantsweretakenoutofoperation.Figure11showstheestimatedcapacitiesand
thermalefficienciesofChinesehardcoalfiredunitsexpectedtobeoperatingin2015.
Figure11.ModernisationoftheChinesecoalfleet
350 50
45
300
40 Subcriticalcapacity(>100MWe)
250 35
Supercriticalandultrasupercritical
Capacity(GWe )
Efficiency(%)
200 30 capacity
25 Subcriticalefficiency(>100MWe)
150 20 Supercriticalandultrasupercritical
100 15 efficiency
10
50
5
0 0

Notes:Capacitiesandthermalefficienciesareonagrossgenerationandfuellowerheatingvaluebasis.Theyearrangesatthebase
showtheyearsoffirstoperationoftheseplants.Notethatthe201115daterange,forsupercriticalandUSCplants,includessome
commissioned from 2006. Plants that have already closed or are due to close before 2015 are excluded. Data consists of early
estimatesfromastudythatisstillinprogress.
Source:IEACleanCoalCentre,usinginformationfromtheCentre'spowerstationdatabaseandadditionaldatafromDrA.Minchener.
This illustrates the rapid modernisation of the Chinese coal fleet through the introduction of
supercritical and ultrasupercritical units in the last decade. With these developments, the
averageefficiencyofChinesecoalfiredplantislikelytooutstripthecurrentaverageefficiencyof
plant in the OECD. Coal is also fuelling Indias economic growth, providing almost 70% of the
countryspowerneeds.LikeChina,Indiaalsohasplanstoreducethecarbonintensityofitscoal
fired fleetof power plants.India hasa total coalfiredcapacityofmore than80GW,more than
halfofwhichisatleast20yearsold.Indiasplantshavelowefficiency,theresultofavarietyof
technicalandinstitutionalfactorssuchaspoorqualityofcoal,electricitygridconditions,lowplant
loadfactor,degradationduetoage,lackofproperoperationandmaintenanceatpowerplants,
ineffectiveregulationsandlackofincentivesforefficiencyimprovements(Chikkatur,A.,2008).

Thereisapromisingopportunitytoimprovetheefficiencyofexistingpowerplantsbyatleastone
totwopercentagepoints.Theretrofitofplantsbuiltduringthelast30yearsisconsideredacost
effective measure to improve operational efficiency and provide additional capacity (Remme et
al.,2011).Inits11thFiveYearPlan(200712),Indiaplanstorenovateandmodernise26GWof
coalcapacity,whilethe12thFiveYearPlan(201217)proposestomoderniseafurther17GW.In
addition,while1.1GWofold,inefficientplanthasalreadybeenretired,closureof4GWistobe Page|33
written into both the 12th and 13th FiveYear Plans (Mathur, 2010). In OECD countries, on the
other hand, coal consumption is projected to decrease, with ageing plants and higher costs
expected to result in the retirement of significant coalfired capacity over the coming years. The
growthindemandforelectricityisalsolikelytobemodestoverthisperiod,duetoexpectedstable
populationandmodesteconomicgrowth.Theshortfallresultingfromthereducedcoalcapacity
willlikelybereplacedbyrenewableenergy,nuclearandgasfiredgeneration(IEA,2010a).
CCStechnologydeploymentstatus
To meet global emissions reduction goals at lowest cost, extensive deployment of CCS is
required. Figure12 shows that around 100 largescale CCS projects will be needed by 2020 to
meettheBLUEMapgoal,andover3000by2050.Thisrepresentsasignificantscaleupfromthe
fivelargescaleCCSprojectsthatareinoperationtoday.
Figure12.CCSdeploymentbyregion,201050
GovernmentsrecognisethecriticalroleofCCSinmitigatingthegrowingfleetofpowerandindustrial
plantspoweredbyfossilfuels,andhavemadeanumberofpubliccommitmentstofundthefirstset
oflargescale8demonstrationprojects.Figure13showsthecurrentsetof77operationalandplanned
largescaledemonstrationprojects.NorthAmericaandEuropecontain68%oftheactiveorplanned
projects31and21projectsrespectivelyfollowedbyCanada(eightprojects),Australia(sixprojects)
andChina(fiveprojects).TherearecurrentlynolargescaleprojectsinJapan,IndiaandRussia.
8
Largescaleisdefinedasstoringmorethan1millontonnesofCO2annually.
Figure13.GlobalstatusoflargescaleCCSdemonstrationprojects
Page|34

Source:GCCSI2011

Approximately twothirds of the planned projects are in the power generation sector. Industry
and upstream projects are also well represented, in particular in natural gas processing. There
are also projects related to the cement, aluminium and iron and steel industries, but these
sectorsareunderrepresented.Manyoftheseprojectsarestillintheearlystagesofdevelopment.
Asof2010,governmentfundingcommitmentstotalledaroundUSD25billion(Figure14).However,
onlyUSD13billionofthesecommitmentshavebeenallocatedtospecificdemonstrationprojects. Page|35
ThecountrieswiththelargestamountsallocatedaretheUnitedStates(USD6.1billion),Canada
(USD3 billion) and Norway (USD1.3 billion). 2010 also saw a worrying gap between funding
needsandnewcommitmentsthatmustbeaddressedifCCSistosucceed.(Figure14).
Figure14.StatusofpublicfundingsupporttoCCS(USDbillion)

Source:GCCSI2011
Further,fundingisoftencontingentonindustryandmaybesusceptibletoreviewdependingon
government priorities and financial constraints. Financial incentives for nonOECD CCS
deploymentarealsocrucial.
Developingpolicyframeworksandengagingthepublic
Important progress is being made towards developing national CCS legal and regulatory
frameworks. Although developments are generally concentrated in OECD regions, including
Europe, Australia, the United States and Canada, nonOECD countries such as South Africa and
the UAE are beginning CCS regulatory discussions and framework development (GCCSI, 2011).
Thisprogressmustcontinue,inparticularinnonOECDcountrieswhichwillplayasignificantrole
inglobalCCSdeployment.
Currently, CO2 mitigation incentives are insufficient to cover the additional costs and risks
associated with building and operating firstofakind, CCS demonstration plants. Accordingly,
additional financial incentives are required in the nearterm where CCS activities are not
supported by other mechanisms such as a sufficient CO2 price9 or additional revenue streams
(enhanced hydrocarbon recovery). While global understanding of CO2 storage opportunities is
improving, there is limited practically usable and characterised storage capacity at the level
needed to support largescale project investment. CO2 storage site characterisations, including
suitablepathwaysfortransportandstorage,needtoaccelerate.
9
NorwayhasacarbontaxonoffshoreoilandgasoperationswhichhasincentivisedtheSleipnerandSnhvitoperations.
Public outreach is critical to CCS deployment but has not received sufficient attention. Projects
suchasBarendrechtintheNetherlands,whichwasrecentlycancelledduetopublicopposition,
emphasisethispoint.Governmentsanddevelopersmustengagethepublicinthedevelopment
of CCS projects in a timely and transparent manner. Work is ongoing internationally to better
manage public engagement processes, drawing on lessons learnt. This development is also
Page|36 startingtobevisibleoutsideOECDcountries.Forexample,SouthAfricahasrecentlylauncheda
new Centre for CCS that will focus on accelerating CCS demonstration, raising awareness and
ensuringpublicengagement;moresucheffortsinkeyfossilbasedeconomiesareneeded.
Publicspendingonresearch,developmentanddemonstration
Higherefficiency, cleaner coal technologies comprise coal conversion and combustion
technologies such as integrated gasified combined cycle (IGCC), as well as coal production,
preparation and transportation. RD&D spending on CCS includes CO2 capture/separation,
transport and storage. Figure15 shows most recent data on RD&D expenditures on clean coal
andCCS:in2010forIEAcountries,2009forRussia,2008forChina,IndiaandSouthAfricaand
2007forMexico.10
Figure15.PublicspendingonenergyefficiencyinCCSandcleancoal
a) CEM countries annual spending, 2010 b) IEA countries cumulative spending, 2005-10
400 600
Total
4119
1187
3958
350 CCS
Cleancoal 500
300
MillionUSD2010
MillionUSD2010
400
250
200 300
150
200
100
100
50
0 0

Notes:ChinaandSouthAfricais2008data,FranceandRussiais2009data.DataforIndiaareR&DbudgetsfromtheOfficeofthe
PrincipalScientificAdvisertotheGovernmentofIndia;amountsareestimatedonayearlybasisasonefifthoftotalbudgets.
Between 2005 and 2010 the United States had the largest budget dedicated to clean coal and
CCS,spendingUSD1.2billiononCCSRD&D,thelionsshareofwhichwasonseverallargescale
demonstrationprojects;withUSD4.1billiononcleancoal.Japanalsorecentlyfocusedmoreon
clean coal technologies. During this period, Australia and Canada increased their expenditures
significantly, especially on CCS for which Australia will spend USD169 million in 2011 (up from
USD55million in 2009) and Canada USD455 million in 2011 (up from USD66 million in 2009).
FrancehasalsoshowedstronginterestinCCS,withUSD214millioninvestedbetween2005and
2010. China spent nearly USD 9.9 Billion between 2005 and 2008 (Kempener et al., 2010) on
fossilfueltechnologies;howeversomeofthiswasfortheoilandgassector.

10
The split between clean coal and CCS for the latter group of countries was not available. The total shown for nonIEA
countries comprises technologies related to other fossil fuel technologies than coal, including enhanced oil and gas
production,refining,nonconventionaloilrecoveryandothertechnologies.MoreworkisneededtoimproveRD&Dspending
statisticsfornonIEAcountries.

Nuclearpower
Technologystatus
Forthepastfiveyears,nuclearpowergrowthhasremainednearlyflatworldwideoperational
Page|37
installednuclearcapacityincreasedfrom370GWeattheendof2005to375GWebytheendof
2010(Figure16).Thisslowgrowthreflectsthelownumberofnewconstructionstartsduringthe
pasttwodecades.Worldwideelectricitygenerationfromnuclearpowerplantshasalsoremained
flat at around 2600TWh. Nuclear power production in OECD countries peaked in 2006 at
2259TWh and declined to 2136 in 2009; a further fall is indicated by preliminary 2010 data.
Meanwhile,nonOECDnuclearproductionrosefrom390TWhin2005to423TWhin2009.This
trendtowardsnonOECDcountriesisexpectedtostrengthenoverthecomingyears,partlydue
totheretirementofolderplantsinOECDcountries.
Figure16.Globalnuclearcapacityvs.BLUEMapscenario,200520
600
ETP2010BlueMap
500
Restoftheworld
400
RestofCEM
UnitedStates
GW
300
Russia
200
Japan
100 France
China
0
2005 2010 2015 2020
Source:IAEAPRISdatabase,2011.
IntheIEABLUEMapscenarioillustratedinFigure16,by2015444GWofnuclearcapacityshould
be installed globally. If all the capacity currently under construction is installed by then, this
targetwillverynearlybeachieved.Itisuncertain,however,whetherallcurrentconstructionswill
becompletedby2015.Therealchallengeexistswhenlookingatthe2020milestone.Giventhe
relatively lengthy construction period needed, a significant number of new construction starts
wouldhavetotakeplaceoverthenextfourtofiveyearsifthecapacityistoreach512GWby
2020. A number of countries have announced ambitious targets for 2020 including China
(80GW),theUnitedStates(111GW),Japan(62GW),Russia(51GW)andIndia(20GW).
AsevereearthquakeandtsunamiinMarch2011thatravagedthePacificcoastofnorthernJapan
resulted in a major incident at the Fukushima Daiichi nuclear power plant. Following these
events, several countries have announced safety reviews of their nuclear programmes. The
impactonthegrowthofnucleargeneratingcapacitywillonlybecomeclearinthecomingmonths
andyears,butitcouldresultinsomecountriesdelaying,scalingbackorcancellingtheplanned
nuclearexpansionthatisdescribedbelow,andalsoleadtoearlierthanexpectedclosureofsome
oldernuclearplants.
Nuclearexpansionplansandpolicydevelopments
Fifteen countries are currently constructing new nuclear capacity (Figure17). Given the lengthy
construction period compared to other electricity generating plants, capacity under construction
providesagoodindicationofexpectedgrowthoverthecomingyears.Assumingthatplantscurrently
Page|38 underconstructionwillbecompleteby2015,theywilladdsome60GWtothepresent375GWof
capacity. Allowing for 3 to 4GW of older plants being closed, plus some additional capacity from
powerupratesatexistingplants,thatinstalledcapacitywouldbeabout430GWbytheendof2015.
Figure17.Nuclearcapacityunderconstructionandnumberofreactors
30
27
25
20
GWe
15
11
10
5 4
5 6
2 2 2
1 1 1 2 1
1 1 2
1
0

Source:IAEAPRISdatabase,2011andcountrysubmissions.
Ofthe66unitsunderconstructionattheendof2010,27wereinChina.Incontrast,Chinahad
onlythreeunitsunderconstructionattheendof2005(allnowinoperation).Hence,theupturn
innuclearconstructionthatisevidentinrecentyearsislargelyduetotherapidexpansionofthe
Chinese nuclear programme. Most of the Chinese units now under construction are the
establishedCPR1000design.Thenextphaseofexpansionisexpectedtobebasedonthemore
advancedAP1000design,thefirstofwhicharenowunderconstructioninthecountry.Current
plans are for more than 30 additional units, beyond those now under construction, to start
buildinginthenextfewyears.
Amongothercountries,Koreaplanstocontinueitsexpansion,withatleastfouradditionalunits
beyond those now under construction. France has announced that a new unit is to start
constructionin2012,andFinlandisalsoactivelyplanningforafurthernewunittofollowtheunit
that is presently under construction. The UAE has plans to build a 5600MW plant, with four
reactors slated between 2017 and 2010. Russia has announced plans to launch construction of
twonewunitseachyear,which hasbeenachieved forthelastthreeyears.Thisisexpectedto
continue,althoughsomeofthisnewcapacitywillbeoffsetbyretiringolderplantsbefore2020.
Indiahastodatelargelyreliedonitsindigenousnucleardesigns,andplanshaveoftensuffered
delays. Nuclear agreements with the United States and other countries in the last few years
mean that India is now able to import nuclear technology more easily, having agreed to place
much of its nuclear programme under international safeguards. More rapid expansion of its
nuclearcapacityisnowexpected,butplansarestilltakingshape.

New nuclear construction in the United States after a 30year hiatus would be a significant
development. License applications for 17 units have been submitted, and plans are being
developedforover30newunits.However,someofthesemaybeputonholdgiventheincrease
in recoverable gas reserves in recent years. Nevertheless, government incentives seem set to
ensure the construction of at least a few new units before 2020. One longsuspended
constructionprojectwasreactivatedin2007,tocomeonlinein2013.Thefirstgovernmentloan Page|39
guaranteeforanuclearplantwasawardedin2010;siteworksarealreadywelladvancedandthe
plantshouldbeonlineby2017.
TheUnitedKingdomhasoneoftheoldestnuclearfleets,basedongascooledreactorsthathave
proved to have shorter operating lives than watercooled reactors used elsewhere. As a result,
manyofitsearlyplantshavealreadyclosedandmostoftheotherswillfollowby2020orsoon
after.Thegovernmentisnowencouragingelectricitycompaniestoinvestinseveralnewnuclear
unitstobeinoperationby2020butiscommittedtoavoidanypublicsubsidy.Atpresent,siting
andlicensingactivitiesareunderway.
Nuclear fission RD&D comprises research on light and heavy water reactors, breeder reactors,
fuel cycle and other nuclear fission technologies. Japan has consistently had the highest RD&D
investmentrates,andcontributedabout70%ofthetotalamountspentbymajorcountriesinthe
lastdecade(Figure18).
Figure18.PublicspendingonnuclearfissionRD&Din2010

Note:Mexicois2007data;dataisfrom2008forothernonIEAcountries.Franceis2009data.Giventhelackofdetail,datafornon
IEAcountriesmightincludeamountsspentonnuclearfusion.
Between2002and2010,Japanistheonlycountrythatreduceditsexpendituresinthissector(by
26%).AmongnonIEAcountries,BrazilspentmostwithoverUSD144million,followedbySouth
AfricawithoverUSD100millionestimatedexpendituresin2008,morethanGermanyandKorea
togetherforthatyear.IndiawasnextwithUSD33millionandChinaspentoverUSD10million.
Russia has a large programme underway that focuses on nextgeneration nuclear technology;
theyhaveannouncedabudgetofUSD3.6billionforthenextdecade(Kempeneretal.,2010).
Renewableenergy
Renewableshavebeenthedriverofmuchofthegrowthintheglobalcleanenergysectorforthe
past decade. Recent years have seen a major scaleup of wind and solar technologies. Other
renewable technologiesincluding hydropower, geothermal and biomasscontinued to grow
Page|40 from a strong established base, adding thousands of megawatts of new capacity worldwide.
Duringthepastdecade,renewableenergygrowthhasbeenunevenacrosstheworld,drivenby
government support. In wind power, China became the global leader in terms of new yearly
installedcapacityinaveryshorttime,overtakingtheUnitedStatesin2010.Germanycontinues
to lead the world in solar PV capacity, followed by Spain and Japan. The United States has the
largest geothermal power capacity with the Philippines, Indonesia, Mexico and Italy following.
China is the leading hydropower producer, followed by the United States, Brazil, Canada and
Russia. In bioenergy for power, the Unites States leads and is followed by Germany, Sweden,
FinlandandtheUnitedKingdom.
In order to achieve the goals of halving the global energyrelated CO2 emissions by 2050, as
assumed in ETP2010 BLUE Map scenario, a significant effort in deployment of renewable
electricityisneeded.In2008,over3700TWhofpowerwasproducedgloballyusingrenewable
sourcesofenergy.TomeettheBLUEMapscenario,thisproductionwillneedtoalmostdoubleto
over7000TWhby2020(Figure19).
Figure19.Globalpowergenerationfromrenewablesourcesvs.BLUEMapscenario
8000
7000
Tide,waveandocean
6000
Geothermal
5000
SolarCSP
TWh
4000
SolarPV
3000
Wind
2000
Bioenergyforpower
1000
Hydro
2000 2002 2004 2006 2008 2020
While hydropower will remain the largest source of renewable power, revolutionary growth in
the deployment of wind, solar, geothermal and bioenergy technologies will be needed: wind
powermustseeanannualaveragegrowthrateof17%andsolarpower22%tomeettheir2020
targets.Thesesortsoflevelsareachievable.Since2005,wehaveobservedcomparablegrowth
rates both for wind and solar technologies, averaging at 26% and 50%, respectively. The
challengewillbetomaintainthishighgrowthforthelongerterm.Thiswillrequiremanufacturing
costreductions,drivenbystableandpredictablepolicysupportthatadaptstomarketconditions.
RenewableenergyRD&Dinvestmentalsoneedstocontinuetoexpandinallmajoreconomies.

Renewableenergypolicy
Policysupportforrenewableenergyhasincreasedconsiderablyoverthelastdecade;therehasbeen
a proliferation in policy tools and a strong growth in the number of countriesusing these policies.
Countriespursuerenewableenergytoimprovetheirenergysecuritybydiversifyingtheenergymix
withlocallyavailableresourcesandtoachieveclimategoals. Page|41
Renewableelectricitypolicyhasundergoneacontinualevolutionoverthepast10years.Ascountries
gain experience in renewable energy deployment, they learn from their own and other nations
experiences, and adapt schemes to meet their policy goals in an effective, costefficient manner.
Table2 presents this evolution in CEM countries for the following technologies: wind, solar PV,
Concentrated solar power (CSP), geothermal power, bioenergy for power (details for biomass
andbiogas)andhydropower.
Renewableelectricitypolicy
In2010,almostallmajoreconomieshadsomeformofsupportschemeforrenewableelectricity;
this stands in contrast to 2000, when only 16 countries provided targeted support. Seventeen
countries currently have FIT schemes, ten countries implement quota obligation systems with
tradable green certificates, and four countries have tender systems in place.11 The table also
illustratesthegrowingnumberofchangesinpolicysupportandadaptationstoexistingschemes.
In2010andinthebeginningof2011,anumberofcountriesadaptedPVFITschemes,withthe
Czech Republic, Spain, France, Italy and Germany revising policies and tariff rates given
unexpectedrapidgrowththatresultedinescalatingpolicycost.BrazilhasalsoshiftedfromaFIT
supportschemetocapacitytendersinanefforttouseamoreadaptivepolicyframework.Japan
isconsideringextendingitscurrentFITschemetoincludesolarPV,wind,smallhydro,geothermal
and biomass. Australia passed legislation to extend its mandatory renewable energy target for
electricityto2020,withtheobjectiveofachieving20%ofelectricityfromrenewables.Anumber
of governments introduced new policies, with India planning to launch a renewable quota
obligationsystematthebeginningof2011.SouthAfricahasmadesignificantprogressinplansto
advanceitsSolarPark,whichwillbuild5GWofsolarcapacityby2020.
Renewableheatpolicies
Governmentsupportforrenewablesbasedheatislowcomparedtorenewablesbasedelectricity
orbiofuelsfortransport.Policydesignforrenewableheatraisesdifferentissuesascomparedto
renewableelectricitypolicydesignduetoanumberofdifferencesbetweenthedeliveryofheat
andelectricity(Connoretal.,2009).Theheterogeneousnatureofheatingfuelsmeansthatthere
isadiversegroupofcompaniessupplyingthemarket.Thedemandsideisalsoisfragmentedand
difficulttotarget:heatisproducedonsitebymillionsofbuildingownersanddevelopers,district
heatingoperatorsandindustries.Moreover,installers,heatingengineersandarchitectsoftenact
ascrucialgatekeepersbetweensupplyanddemand.
11
Afeedintariffreferstoafixedguaranteedpriceatwhichpowerproducerscansellrenewablepowerintotheelectricpower
network; quota obligation systems require a minimum percentage of electricity sold or generation capacity installed to be
providedbyrenewableenergy,whichutilitiesmustmeet.Theycanalsosetobligationsthataminimumpercentageofelectricity
purchasedcomesfromrenewableenergysources;Atradablegreencertificaterepresentsthecertifiedgenerationofoneunitof
renewable energy, generally one megawatthour (MWh). Certificates can be traded and used to meet renewable energy
obligationsamongconsumersand/orproducers,andcanalsobeusedforvoluntaryrenewableenergypowerpurchases.
Table2.EvolutioninrenewableelectricitysupportpoliciesinCleanEnergyMinisterialcountries
00
01
02
03
04
05
06
07
08
09
10
11
20
20
20
20
20
20
20
20
20
20
20
20
Page|42 PV
Australia
Other renewables
Hydropower
Brazil
Other renewables
Canada All renewables
PV
China
Wind
Solar
Denmark All renewables
Finland All renewables
Wind
Bioenergy
France
PV
Other renewables
Germany All renewables
PV
Wind
India
Other renewables

00
01
02
03
04
05
06
07
08
09
10
11
20
20
20
20
20
20
20
20
20
20
20
20
Indonesia Geothermal
Page|43
PV
Italy
Other renewables
PV
Japan
Other renewables
PV
Republic of
Korea
Other renewables
Mexico All renewables
Norway All renewables
Russia
South Africa All renewables
Spain All renewables
Sweden All renewables
UAE All renewables
UK Alll renewables
USA All renewables
* Policies implemented at state/ provice/ territory level
Quota obligaon or green cercate Change in exisng policy scheme

Tax incenves and investment grants Policy scheme introduced or ended
Feed-in tari
Tender
Todate,themostwidelyadoptedmechanismsforthesupportofrenewableheataredirectcapital
grantsandtaxcreditsforthepurchaseofarenewableheatingsystem.Directcapitalgrantsforsolar
thermalsystemsexistinmanyEuropeanUnioncountries.However,subsidyschemesoftendepend
directlyonthepublicbudget;assuch,conditionschangeregularlyandschemessufferfromstopand
go support, depending on the political agenda. Another disadvantage is the absent guarantee of
Page|44 producingrenewableheat,asgrantsortaxcreditsareoftenprovidedwithoutverifyingwhetherheat
equipmenthasbeenproperlyinstalled.Still,grantandtaxcreditschemescontinuetostayinforce,as
theyarepopularwithindividualconsumersandhavelowtransactioncostsrelativetootherschemes.
A number of countries have deviated from financial incentive schemes to introduce use
obligationsforrenewableheatsystems.TheSpanishgovernmentdevelopedanationalsolarheat
obligation policy in 2006; Portugal and cities in Italy, Brazil and India followed. Since a solar
obligation incentivises one specific technology, such a policy should be introduced only where
thereisnocompetitionwithotherrenewabletechnologiesforthesamemarket.Theprocedure
for checking compliance and the absence of an incentive to exceed the required level of the
obligation are weaknesses of the solar obligation. The German Marktanreizprogram aims to
increaserenewableheatingeneral,includinggeothermalheatfromhotsedimentarybasinsused
indistrictheatingsystems.Moreover,theGermanRenewableEnergySourcesActguaranteesa
bonus of EUR 3 cent/kWh to the FIT for geothermal (binary) power plants if the waste heat is
made useful. In March 2011, the United Kingdom announced the Renewable Heat Incentive
(RHI), the first heat market feedin tariff. The RHI is designed to provide a continuous income
streamovertwentyyearsuponinstallationofaneligiblerenewableheatingsystem.In2011,the
schemewillintroducepremiumpaymentsforthenondomesticsector.In2012,theschemewill
expand to the domestic sector. Solar thermal systems are rewarded a premium payment of
GBP0.085/kWhth(EUR0.099/kWhth)forsystems<200kWth.
WindPower
Technologydeployment
Windpowerexperienceddramaticgrowthoverthelastdecade.Globalinstalledcapacityatthe
end of 2010 was around 195GW, up from 18GW at the end of the year 2000. Nearly 36GW
were added in 2010 alone. Clean Energy Ministerial countries accounted for over 90% of total
installedcapacityin2010,correspondingtosome175GW(Figure20).
OverthelastcoupleofyearswindscentreofgrowthmovedfromEuropeandNorthAmericato
Asia,whichemergedasthegloballeader.Intheyear2010,Chinaaddedroughly17GWofcapacity
andbecamethegloballeaderintermsofinstalledcapacity.WhileChinaisatpresentveryfastin
buildingnewwindcapacitythereisalagofseveralmonthsinconnectingthiscapacitytothegrid.
Asaresult,arelativelylowcapacityfactorisseeninChina.WhileChinaswindgrowthhasbeen
impressively rapid, windpower only provides just 1% of total electricity output in China.
Contributing to the large Asian growth, India added over 2GW of new wind power in the 2010.
GrowthinEuropeandNorthAmericahasslowedsomewhat,theresultoftheeconomicdownturn,
which resulted in reduced access to financing. In addition, rising materials costs and turbine and
componentshortageshavecontributedtorisingwindcosts.

Figure20.CleanEnergyMinisterialcountrieswindpowercapacity(GW)
200
180 RestofCEM
160
UnitedStates
140 Page|45
120
Spain
GW
100
80 India
60
Germany
40
20 China
0
2000 2002 2004 2006 2008 2010
Source:GlobalWindEnergyCouncilandcountrysubmissions.
IntheUnitedStatestheseeffectswereamplifiedbytheweakdollar.Offshoredevelopmentswere
concentratedmostlyinEurope,where883MWwereinstalledintheyear2010,bringingthetotal
installedcapacitytoroughly3GW.
Policydevelopments
A number of recent important policy measures and programmes have emerged in support of
expandedwindmarkets.Manyofthenewpolicydevelopmentsconcernoffshorewind:
Offshore wind is now a Chinese priority with the publication of its Offshore Wind
Development Plan in 2009 and with the establishment of a new FIT. The official target for
winddeploymentwasincreasedto150GW.
TheUnitedKingdomemphasisedonshoreandoffshorewindinitsNationalRenewableEnergy
Action Plan, with funding allocated by the newly created Green Investment Bank. Up to
33GWofoffshorerenewablegenerationistargetedviaamaximumofGBP15billioninvested
inoffshoreinfrastructures.
IntheUnitedStates,theUSD1billionCapeWindproject,thecountrysfirstoffshorewindfarm,
wassuccessfullyapprovedbytheDepartmentofInterior.TheDepartmentofEnergyiscurrently
reviewingtheloanguaranteeapplication.InDecember2010,theDOEalsofinalisedadealfor
the Caithness Shepherds Flat project, the world's largest wind project to date, by providing a
partialloanguaranteeofUSD1.3billionforthe845MWfacilitylocatedineasternOregon.
Spaincontinuesitsfocusononshorewinddeployment,issuinganewFITinDecember2010
fornewwindpowercapacityto2012.
The European Union launched a 10year European Wind Initiative that will provide
EUR6billioninpartnershipwithindustrytoadvancewindRD&D.
Solarenergy
Solarphotovoltaicdeployment
From 200010, solar PV was the fastestgrowing renewable power technology worldwide.
Page|46 Estimates suggest that cumulative installed capacity of solar PV reached roughly 40GW at the
end of 2010, up from 1.5GW in 2000 (Figure21). At least 17GW were added in 2010, roughly
halfinGermany.Intheyear2009,thelastyearforwhichafulldatasetisavailable,Germany,
Spain, Japan, the United States, Italy and Korea accounted for over 90% of global cumulative
capacity. Based on first available data for 2010, Germany maintains its massive lead of the
market.ItalyandtheCzechRepublicalsosawasolarPVboomresultingfromgenerousFITsand
rapidlydecreasingPVmodulecosts.
Spain experienced rapid growth in 2008, followed by a significant slowdown after a new
regulatory framework was introduced in 2009. The government has sought to rationalise
deploymentandcontroltheimpactoftheFITbyestablishingaquotaof500MWofnewcapacity
peryear,arelativelymodesttarget,comparingtothe2500MWaddedin2008.Growthinthe
United States remained stable, while Japan continues to lead the way in Asia, adding almost
500MW in 2009. China has announced ambitious targets and we can expect that China will
transformitsrolefromaleaderinPVmanufacturingtoacceleratedomesticdeploymentoverthe
nextfewyears.
Figure21.SolarPVelectriccapacityinCEMCountries(GW)
25
20
RestofCEM
UnitedStates
15
Spain
GW
10 Korea
Japan
5
Italy
Germany
0
2000 2003 2006 2009
Source:CountrysubmissionsandChinaElectricityCouncil,2010.
Concentratedsolarpowerdeployment
Concentratedsolarpowerisareemergingmarket.Roughly350MWofcommercialplantswere
builtinCaliforniainthelate1980s;activitystartedagainin2006intheUnitedStates,(473MW
at the end of 2009) and Spain (632MW at the end of 2010). At present, Spain and the United
States are the only two countries with significant CSP capacity. As CSP requires strong direct
irradiation, future developments are expected in a handful of key countries in semiarid, hot

regions. Projects are under construction or planning in a number of developing and emerging
economies, including Algeria, Egypt, Morocco, Australia, China, India, Israel, Jordan, Mexico,
SouthAfricaandtheUnitedArabEmirates.
Solarheatdeployment
Page|47
Bytheendof2008,worldwideinstalledsolarthermalcapacitytotalled152GWthcorresponding
to 217 million square meters (Figure22). Of total solar thermal capacity installed in 2008,
132GWth consist of flatplate and evacuated tube collectors. Unglazed plastic collectors
accounted for 19GWth, which are the dominant application in the United States and Australia,
mainly used for swimming pool heating. The remaining 1GWth comes from solar air collectors.
ThemainmarketsareinChina(87.5GWth),Europe(28.5GWth)andtheUnitedStatesandCanada
(15.1GWth).LeadingcountriesinflatplateandevacuatedtubecollectorsareChina(87.5GWth),
Turkey(7.5GWth),Germany(7.2GWth),Japan(4.1GWth)andGreece(2.7GWth).Apartfromsolar
thermal systems operating on individual buildings, some 150 largescale solar thermal plants
(500m2; 350kWth) are in operation in Europe, functioning as multifamily building systems or
contributingtodistrictheating.
Figure22.Solarheatcapacityinleadingcountries(GWth)
65
88
21
14
14
12 2006 2008
10
8
GWth

Note:Figuresareforlowandmediumtemperature.
Source:Weiss,etal.,(2010).
Annualinstalledglazedcollectorareaworldwidewasmorethanfourtimeshigherin2008thanin
2000,withanaverageannualgrowthof20.1%(Weiss,2010).Theestimatesfor2009showthat
capacity has increased significantly again to 189GWth with complete data available for Europe
andChina(Weiss,etal.,2010).
Solarenergypolicydevelopments
Mostcountrieswithfavourablesolardeploymenthaveadoptedanintegratedpolicyapproachby
establishing national Solar Missions or Programmes to set targets and drive coordination.
Photovoltaicpoliciesfacedmajorchallengesin2010andbeginningof2011.Whileexpansionin
global PV capacity has been a positive development, in that it has delivered significant cost
reductions,thisboomwaslargerthanexpected.Asaconsequence,escalatingpolicycostsraised
thequestionoffinancialsustainabilityofpolicyschemes.Asaresult,2010andthebeginningof
2011sawanumberofcountriesreducingFITtariffratesforsolarPVdevelopment,andinsome
cases halting capacity expansion (Table2 above). A key need is to design policies that adjust
Page|48 support to follow rapid reductions in the cost of solar technology. For solar heating, the most
widelyadoptedsupportmechanismsaredirectcapitalgrantsandtaxcreditsforthepurchaseof
asolarthermalsystem;theseareofferedbyanumberofEuropeanUnioncountries.
Othernoteworthypolicydevelopmentsinclude:
India launched its Solar Mission in 2009 with an objective of 20GW of installed capacity by
2022,supportedbytheuseofrenewablepurchaseobligationandpreferentialtariffrates.
China established the Golden Sun programme in 2009 to expand solar production in China,
with subsidies for 50% of the cost of investment in projects and related transmission and
distributionsystems.Forremote,nongridconnectedregions,subsidescouldamountto70%.
In 2010, China also implemented the Building Integrated Solar PV programme that provides
incentives and grants. The China Energy Conservation and Environmental Protection group
completedoneofthelargestbuildingintegratedPVinstallationsintheworldatover6.5MW.
InSouthAfrica,plansfortheSolarParkwereapprovedbytheDepartmentofEnergy,withthe
objectiveofbuilding5GWofsolarcapacity.
TheUnitedStatessawprogressin2010inthepermittingoflargeCSPplantswhichwillleadto
expansionoftheindustryin2011.TheDOEalsofinalisedaUSD1.45billionloanguaranteefor
theworld'slargestparabolictroughCSPplantitwillbe250MWincapacity.
Israel pioneered solar heating obligations in the 1980, mandating solar collectors in all new
residentialbuildings.Today,solarthermalsystemsareamainstreamtechnologyintheIsraeli
waterheatermarketwithoutanyfinancialsupport.
Deploymentofsolarthermaltechnologiescanalsobeencouragedinenergyefficientbuilding
regulations.Germanys2009buildingregulationsrequireadefinedshareofanewbuildings
heatdemandtobesuppliedbyrenewableenergy.
Hydropower
Hydropowerdeployment
Hydropower remains the worlds largest source of renewable energy. Much of the growth in
recentyearscanbeseenindevelopingcountrieswithChinaleadingtheway(Figure23).China
ended2009withnearly200GWofinstalledcapacity,anenormousincreaseon2005whenithad
an installed capacity of 117GW. Over this period of rapid economic expansion in China and
surgingdemandforenergy,hydropowerhasmaintaineditsshareintotalelectricityoutput.

Figure23.HydropowerelectricityproductioninCEMcountries(TWh)
3000
2500
RestofCEM
Page|49
2000
UnitedStates
TWh
1500 Russia
1000 China
500 Canada
Brazil
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Notes:Excludespumpedstorage.Some2009numbersareestimates.
Source:CountrysubmissionsandChinaElectricityCouncil,2010.
New hydropower development is concentrated in emerging economies. Many OECD countries

have successfully tapped into their large hydro potential, and are now focusing on smaller
applications.TheworldleadersinhydropowerproductionareChina,Canada,Brazil,theUnited
StatesandRussia.ForBrazilandCanadahydrorepresentsaverylargeshareofnationalpower
generation,roughly80%and60%,respectively,dependingonweatherconditionsinagivenyear.
Policydevelopments
Whilehydropowerrepresentsthelargestshareofrenewableelectricityproduction,development
of large hydropower slowed over the last decade due to concerns related to its environmental
andsocialimpacts.Lifecycleassessmentsandotherpoliciesarebeingdevelopedtoensurethat
projects are sustainably developed. In 2010, the IEA Hydropower Implementing Agreement
updated its Recommendations for Hydropower and the Environment12 and the International
Hydropower Association released an updated Hydropower Assessment Sustainability Protocol
(IEA Hydropower IA, 2010). These efforts aim to provide a broadly supported sustainability
assessment tool to measure and guide hydropower performance. While large hydropower is
generally competitive, most hydropower financial support policies aim to address costs of
generationforsmallinstallations.
Geothermalenergy
Geothermalpowerdeployment
Hightemperaturegeothermalenergyresourcessuitableforpowergenerationareconcentrated
in a small number of countries. Due to the uniqueness of the geothermal resource, the
technologyisconsideredrelativelyrisky;asaresult,growthhasbeenslowoverthelastdecade.
12
TheIEAHydropowerImplementingAgreementledworkinthisfieldsince2000.Withinitscurrentactivities,Brazilisleading
theworkonthemanagementofthecarbonbalanceinfreshwaterreservoirs.
In2009,globalinstalledpowercapacitywasnearly11GW,generatingover67TWhofelectricity.
Much of this was generated outside of the CEM group of countries in places such as the
Philippines(10TWh),Iceland(4.5TWh)andNewZealand(4TWh).
Figure24.GeothermalelectricityproductioninCEMcountries(TWh)
Page|50 45
40
UnitedStates
35
Russia
30
Mexico
25
TWh
20 Japan
15 Italy
10
Indonesia
5
Germany
0
2000 2003 2006 2009

Source:CountrysubmissionsandBertani,2010.
GloballeadersingeothermalpowergenerationincludetheUS,thePhilippines,Indonesia,Mexico
andItaly(Figure24).CapacityhasgrownsteadilyintheUnitedStatesandIndonesiaoverthelast
decade.Bothofthesecountrieshaveextensiveexperiencewithgeothermalpower;withalarge
additionalpotential,theyaimtoexpanddevelopment.Geothermalpowerwillbeabletodeliver
even more significant contribution and on a global scale if efforts to develop technologies
tapping into hot dry rock resources like enhanced geothermal systems prove to be successful
(IEA,2010b).13
Geothermalheatdeployment
Geothermalheatresourcescanbeusedforawiderangeofheatapplicationssuchasspaceand
districtheating,spaandswimmingpoolheating,greenhouseandsoilheating,aquaculturepond
heating and industrial process heating. Total global installed capacity of geothermal heat
(excluding heat pumps) equalled 15GWth in 2009 with a yearly heat production of 223PJ
(5.3Mtoe)(Figure25).Thisincreasesfrom139PJin2000and175TJin2005(Lundetal.,2010;
LundandFreeston,2000;Lundetal.,2005).
Ground source heat pumps are sometimes ranked under geothermal heat production.14
Deployment of geothermal ground source heat pumps accounted for rapid acceleration of
production levels from 23PJ in 2000 to 215PJ (5.1Mtoe) in 2010 (Lund et al., 2010; Lund and
Freeston,2000;Lundetal.,2005).

13
TheIEAGeothermalRoadmapwillbepublishedinMay2011.
14
ThisisnotthepracticeinIEAstatistics.

Figure25.Top15countriesusinggeothermalheat,excludingheatpumps,2009
80
70
60
Page|51
50
PJ/year
40
Geothermalheatuse
30 excludingGHSP
20
GHSPdeployment
10

Source:Lundetal.,2010.
Policydevelopments
Achievingthepotentialofdeploymentofgeothermalpowerwillrequirepolicysupporttoovercome
the barriers of high initial capital cost, resource development risk, lack of awareness about
geothermalenergyandenvironmentalissues.Themostwidelyadoptedmechanismsforgeothermal
heataredirectcapitalgrantsandtaxcreditsforconsumerpurchasesofagroundsourceheatpump.
Anumberofrecentpolicydevelopmentsshowprogress:
USfederal taxincentivesforgeothermalpowerwereexpandedthrough the2009economic
stimulus legislation. USD350 million was provided to the DOE Geothermal Technologies
Programme,with2010seeingtheapprovalofmanynewprojects.
TheIndonesiangovernmenthasobjectivestodevelopover12GWofnewgeothermalpower
capacityby2025,andwillsupportthiswithtaxincentives.
Kenyahopestoachieve490MWofgeothermalpowerby2012and4GWwithin20years,and
hasamendeditsFITtoincludegeothermalenergy.
Germany amended its Renewable Energy Sources Act in 2009 to increase the tariffs for
geothermal facilities, with a FIT bonus for the use of EGS technologies of EUR0.04/kWh.
Funds from the Market Incentive Programme are available for installations harvesting deep
geothermalenergyforelectricityandheatgeneration.
In the United Kingdom, the Deep Geothermal Challenge Fund awarded GBP5.1 million
through2010insupportofsixdemonstrationprojects.StartinginApril2011,anexpansionto
therenewablefeedintariffsisplannedtolowcarbonheatingtechnologies,includingground
sourceheatpumps.
In 2010, Australia committed AD1.1billion in the form of tax credits and rebates to
geothermal development. The largest global project under development is in the Cooper
Basin,withthepotentialtosupportupto10GWincapacity.
The European Deep Geothermal Energy programme test site for EGS in France began
electricityproductionin2010.
Bioenergy
Bioenergypowerdeployment
Thegrowthinelectricityproductionfromsolidbiomass,biogasandrenewablemunicipalwaste
Page|52 andliquidbiofuelshasbeensteadysincethebeginningofthedecade.In2000,over130TWhof
powerwasproducedfrombioenergy,withCleanEnergyMinisterialcountriesaccountingfor88%
ofthisoutput.By2009,CEMcountrieshadincreasedtheiroutputtoover200TWh(Figure26).
Figure26.BioenergyforelectricityproductionCEMcountries
250
200
RestofCEM
150
UnitedStates
TWh
Sweden
100
Japan
Germany
50
Brazil
0
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Note:Some2009numbersareestimates.
Growthinsomecountrieshasbeenmorerapidthaninothers.TheUnitedStatesistheleader,
followedbyGermany,whoseoutputhasgrownover22%peryearduringthelastdecade.Brazil
isalsosteadilygrowing;ithasincreaseditscapacityfromlessthan4GWin2005tonearly8GW
in2010,withplanstoreach11.5GWby2015.
Biomassforheatdeployment
The progress in biomass for heat over time is difficult to characterise, as it is disguised by
extensiveuseofbiomassasasourceofheatintheresidentialsectorindevelopingcountries.This
traditionalbiomassincludeswood,charcoal,cropresiduesandanimaldungandismostlyused
forcookingandwaterheatingandspaceheating.15In2008,746Mtoeoftraditionalbiomasswas
consumed in the residential sector in developing countries, with consumption in subSaharan
African countries accounting for 32%; demand for traditional biomass worldwide increased by
12%between2000and2008(IEA,2010g).
Modernbiomassforheatconsistsofbiomassusedinefficientstovesorinstallations.Inmodern
renewableheat,biomassdominatesoversolarthermalandgeothermalheat;inOECDcountries
89% of renewable heat came from biomass in 2008. The global use of modern biomass for
producing heat reached 278Mtoe in 2008 (including wood products, such as pellets and
briquettesthathavebeenmadetoburnefficiently,industrialbiogasandbioliquids)(IEA,2010g).

15
Theuseofthesebiomassresourcesisconsideredtraditionalbecausetheyaremostoftenburnedatverylowefficiencies
andreleasemanypollutantsthathaveaserioushealthimpact.

Policydevelopments
Biomassistheonlyrenewablesourcethatissuitableforproducingpower,heatandtransportfuels
butonlyabout20%ofbiomassisusedonanindustrialscalefortheseproductions.Mostbiomassis
currently used for traditional smallscale domestic heating and cooking, mostly in developing
countries.BiopowerissupportedbytargetedFITschemes,renewableportfoliostandardsandtax Page|53
incentives.ManygovernmentsprovidesupportforbioenergyinCHP;somecountriesalsosupport
biomasscofiringincoalpowerplants.GiventhatreducingCO2emissionsisanimportantdriverfor
bioenergy support, much of the debate has focused on ensuring that bioenergy applications
generateanetCO2benefitacrosstheirentirelifecycle.16Themostwidelyadoptedmechanismsfor
thesupportofsmallscalebiomassheataredirectcapitalgrantsandtaxcreditsforthepurchaseof
abiomassheatingsystem,mainlyinbuildings.Directcapitalgrantsforbiomassheatingsystemscan
befoundinseveralEuropeanUnioncountries.Modernbiomassforheatcanalsobeencouraged
through energyefficient building regulations. Germanys 2009 building regulations require a
definedshareofanewbuildingsheatdemandtobesuppliedbyrenewableenergy.
In 2010, the Chinese National Development and Reform Commission announced a new
national FIT for biomass power of CNY 0.75/kWh (USD0.11/kWh), together with a national
biomasscapacitytargetof30GWby2020.
The Argentinian Ministry of Federal Planning, Public Investments and Services launched the
Renewable Energy Generation (RENGEN) programme to have 8% of total electricity come
fromrenewablesourcesby2016.ThepublicutilityENARSAwillimplementtendersforatotal
of 1000MW of electricity produced from renewable sources, out of which 150MW are
expected to come from thermal biocombustion, 120MW from urban renewable waste and
100MWfrombiomass.
In Germany, the FIT has recently been adjusted to increase tariffs for biomass generated
electricityandtoemphasiseCHPgenerationthroughadditionalbonuses.
FrancereducedtheirbiomassCHPtariffsinJanuary2011.In2010and2011,thegovernment
tendered 450MW of biomass capacity, and targets a total installed capacity of 2300MW
by2020.
In January 2011 the Finnish government approved the first national feedintariff for
electricity generated from wind, biogas and wood chips. The regulation implements a fixed
tarifftobiogaselectricityproducers,fora12yearperiod,andanadditionalcapitalpremium
forCHPplants.ThispolicywillbekeytoachieveFinlandsstrategytomeetatargetof38%of
energyconsumptionfromrenewablesby2020,growingfrom28%today.
The German Marktanreizprogram is one example of a policy looking into encouragement of
renewable heat in general; modern biomass for heat is included in the policy for all these
marketsegments.
Publicspendingonresearch,developmentanddemonstrationfor
renewableenergy
RenewableenergyRD&D comprisessolarPV,CSP,solarheating andcooling, wind, hydropower,
geothermal electricity and heat, production and use of biomass and waste (including liquid
16
TheIEABioenergyImplementingAgreementandtheGlobalBioenergyPartnershipareleadingeffortstodevelopanalysis
andcommondefinitionsforbioenergylifecycleestimates.
biofuels and biogas), and other renewable technologies such as ocean and wave/tidal power.17
Overall, there was a significant threefold increase in CEM countries RD&D expenditures on
renewableenergybetween2000and2010.In2010,therewasalargedecreasetoUSD3.1billion
totalspendingfrom2009salltimehighofUSD3.8billionduetoreductionsinstimulusspending.
However, estimates for 2011 indicate that spending regains momentum as more data become
Page|54 availablefromawiderrangeofcountries.Between2000and2010,countriesspentUSD56billion
on nuclear energy and USD22 billion on fossil fuels RD&D, this compares to renewable
technologiesforwhichCEMcountriesspentonlyUSD16billionoverthesametimeperiod.
The United States is the largest spender on renewable energy RD&D among CEM countries.
Between 2005 and 2010, the United States spent USD4.9 billion, representing 40% of the total
spentbyallcountries.Inaddition,theUSspendingamountincreasedsignificantlycomparedtothe
first half of the decade, when the country spent USD1.4 billion (200005). In 2011, the United
StateshasmadeasignificantincreaseinsolarenergyRD&D,especiallyCSP(USD141million)which
representsasmuchas12%oftotalrenewabletechnologiesRD&Dforthisyear.JapanandAustralia
increasedexpendituresonsolarenergy;eachcountryspentaboutUSD145millionin2011.
Figure27.PublicspendingonrenewableenergyRD&D(2010USDmillion)
Australia(91)
Brazil(261)
Canada(172)
Denmark(63)
3
Finland(51)
4
France(200)
5
Germany(248)
6
India(47)
Italy(75)
Japan(237)
3,5
Korea(151)
Norway(57)
3,4,5
Russia(22)
1,2
SouthAfrica(5)
Spain(38)
Sweden(97)
3
UnitedKingdom(257)
5
UnitedStates(1310)
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Biomassandwaste Biofuels SolarPV SolarCSP Othersolar Wind Geothermal Hydro Other/nonspecifiedrenewables

Sources:Countrysubmissions,Kempeneretal.,2010.
Notes:
1
Datais2008.
2
Source:Kempeneretal.,2010.
3
Officialdatadoesnotincludeasplitbetweenthedifferentsolartechnologies.
4
Datais2009.
5
Officialdatasuggestsonlyanumberfortotalbiomass,thesplitbetweensolidbiomass,wasteandliquidbiofuelsisestimated.
6
DataareR&DbudgetsandweretakenfromtheOfficeofthePrincipalScientificAdvisertotheGovernmentofIndia,togetherwith
hte submission by the Ministry of New and Renewable Energy. The Office of the Scientific Advisor amounts were estimated on a
yearlybasisasonefifthoftotalbudgets.
Fortotalbiomass,theUnitedStatesalsoleadsRD&DexpenditureswithUSD2.6billionbetween
2005 and 2010, followed by Brazil, Japan and Canada, who spent together more than
USD1billion in this time period. For nonIEA countries other than Brazil, Russia spent some

17
Liquidbiofuelsaredescribedseparatelyinthenextsectionofthisreport.

estimated USD46 million on biomass between 2007 and 2009 (including biofuels). India spent
around USD100 million between 2000 and 2008 on solar, wind, small hydro and biogas
technologies RD&D but no specific rates are officially available (Kempener et al., 2010).
ApproximatelyIndiaplanstospendUSD43milliononbioenergybetween2007and2011outof
atotalrenewableenergyRD&DbudgetofUSD237.
Generally, there are no detailed data breakdowns available for large emerging countries on Page|55
renewable energy RD&D spending. As these countries develop a growing number of initiatives to
increaserenewableenergy,itwillbeimportanttoimproveRD&Dspendingdataforthesecountries.
Brazil,Korea,Japan,Russia,theUnitedKingdomandtheUnitedStateshavemadespecialefforts
to submit more detailed RD&D data on subsectors. This allows for important insights upon
prioritiesandtrendsinthesecountries.
Biofuels
WhilebiofuelshavebeenproducedcommerciallyinboththeUnitedStatesandBrazilforseveral
decades, the sector has seen its fastest growth rate during the last 10 years. Driven by policy
supportinbothOECDandmorerecently,nonOECDcountries,globalbiofuelsproductiongrew
from16billionlitresin2000tomorethan100billionlitresin2010(Figure28).Today,biofuels
provide2.7%ofglobalroadtransportfuelonanenergybasis,buthighersharesareachievedin
somecountriesandregions.InBrazil,asmuchas21%ofalltransportfuelisfrombiofuels;inthe
UnitedStatesitsshareis4%andintheEuropeanUnionitisaround3%.
ThedevelopmentofadvancedbiofueltechnologieswillbeessentialtoachievingtheBLUEMap
scenario over the next few decades. These technologiesincluding cellulosicethanol, biomass
toliquids diesel, biosynthetic gas and other innovative conversion routeswill need to rapidly
move from current demonstration plants to commercialscale production units over the next
10years(Figure29).
Figure28.Globalbiofuelsproductionbytypeoffuel,200010
120
100
Otherbiodiesel
Billionlitres
80
OECDEuropebiodiesel
60
Otherethanol
40
UnitedStatesethanol
20
Brazilethanol
0
2000 2002 2004 2006 2008 2010
Figure29.IEAbiofuelroadmapsvision18forbiofuelsupply,201050
35
30 Biomethane
Page|56 25 Biojet
20 Biodiesel advanced
EJ
15 Biodiesel conventional
Ethanol advanced
10
Ethanol cane
5
Ethanol conventional
0
2010 2020 2030 2040 2050
Installed advanced biofuel capacity (e.g. lignocellulosic ethanol, biomasstoliquids and other
types) today is roughly 175million litres gasoline equivalent (lge)/year, but most plants are
currently operating below nameplate capacity. Another 1.9billion lge/year production capacity
arecurrentlyunderconstructionandwould,ifoperatingwithfullload,besufficienttomeetthe
IEABLUEMaptargetsforadvancedbiofuelproductionuntil2013.Inaddition,projectproposals
foranadditional6billionlgeannualcapacityby2015havebeenannounced.Advancedbiofuels
havenotyetbeenproducedatacommercialscale;severalpilotanddemonstrationplantshave
beenannouncedduringthepastdecadeandaconsiderablenumberofprojectsareexpectedto
becomeoperationalinthenextfiveyears(Figure30).
Figure30. Advanced biofuel production capacity: current status with planned capacity to 2015
andIEABiofuelroadmapvisionforgrowthto2020(left)and2030(right)

Notes:Aloadfactorof70%isassumedforfullyoperationalplants.Actualproductionvolumesmaybewellbelownameplatecapacity
duringthefirstyearsofproduction.

18
TheIEABiofuelsRoadmapwillbepublishedinMay2011.

The challenge of reaching this vision becomes clear when looking at the required development of
advancedbiofuelcapacityoutto2030inthegraphabove,andevenmoresowhenlookingatthelong
termvisionintheIEABLUEMapscenario.A40foldincreaseincurrentlyannouncedadvancedbiofuel
capacitywillberequiredtoreach320billionlgein2030.Between2030and2050,afurtherdoubling
ofadvancedbiofuelcapacitywillberequired.Policieswillbecriticaltoachievethispathway.
Page|57
Policydevelopments
The most important policies to encourage biofuels include mandatory sustainability
requirements, blending targets or mandates for biofuels with traditional fuels and loan
guarantees and other financing mechanism that address the investment risk of developing
commercialscaleadvancedbiofuelproductionunits.
Sustainabilitycriteriaensurethat biofuelsdevelop withapositivesocialimpactandwithout
competing with food or causing negative impacts for biodiversity. There are a number of
sustainabilityrequirementsunderway;theGlobalBioenergyPartnershipiscurrentlyworking
todevelopaninternationallyagreedstandard.
Over 50 countries have introduced blending targets or mandates for biofuels in gasoline
and/or biodiesel, often coupled to reduced excise duties. When backed by effective
enforcement,thesehavebeeneffectiveinincreasingbiofueluse.
InFebruary2010,theUSEnvironmentalProtectionAgency(EPA)finalisedregulationsunder
the Energy Independence and Security Act of 2007 that make significant changes to the
renewablefuelstandardintheEnergyPolicyActof2005.Thechangesaimtoboostdomestic
biofuels production by, among other things, expanding the volume of renewable fuel that
transportationfuelsoldintheUnitedStatesmustcontain.Thisrulemakingalsorepresentsthe
firsttimethatGHGemissionperformancestandardsarebeingappliedinaregulatorycontext
for a nationwide programme. The United States also has a cellulosicethanol quota, which
creates a market for this advanced biofuel. The United States provides loan guarantees and
funding mechanisms for advanced biofuel production plants through the United States
BiomassProgram.
TheEUsRenewableEnergyDirectiverequiresthatbiofuelsgenerateGHGsavingsofatleast
35% compared to fossil fuels starting at the end of 2010; these requirements rise to 50%
savings in 2017 and 60% in 2018. The European Union will also maintain a target of 5.75%
renewable fuels (by energy content) in transport by 2010 and a 10% renewable energy
mandate for 2010. Further, advanced biofuels from lignocellulosic biomass counts twice
againsttheEUtargets.FundingisprovidedundertheEUsResearchFrameworkProgramme;
some Member States, e.g. Denmark and Germany provide specific financial support for
advancedbiofuelsplants.
For biofuel technologies, there have been important historical data gaps for key countries,
particularlyregardingthedivisionbetweenliquidbiofuelsandotherbiomassintermsofRD&D
spending.ThiswasalsothecaseintheUnitedStatesandBrazil.ForthepurposesofthisProgress
Report,CEMcountriesreportedincreasinglydetaileddataoncertaintechnologies,includingfor
biofuels RD&D that consists of thermochemical, biochemical production of biofuels, algal and
other liquid biofuels. Thanks to this additional data, a better assessment can be made of the
investmentsindifferenttypesofbioenergy.
The United States is the leading country at USD189 million (Figure31), with major interest in
biochemical and thermochemical sources of fuels. France has invested increasingly in biofuels
since2004,reachingUSD100millionin2009accountingfor10%oftotalnationalenergyRD&D
in that year and comparable with Brazil who spent an estimated average of USD 90 million on
biofuelsbetween2009and2010.
Page|58
Figure31.PublicspendingonbiofuelsinCEMcountriesin2010
200
180
160
140
MillionUSD2010
120
100
80
60
40
20

Notes:FranceandRussiais2009data.DataforIndiaareR&DbudgetsandarefromtheOfficeofthePrincipalScientificAdvisertothe
GovernmentofIndia;amountswereestimatedonayearlybasisasonefifthoftotalbudgets.DatafornonIEAcountries,Germany
andKoreamightincludeamountsspentonsolidbiomassandbiogas.
Electricvehiclesandvehicleefficiency
In the ETP2010 Baseline scenario, lightduty vehicle sales are mainly conventional internal
combustionengine(ICE)vehiclesthrough2050;hybridsreachabout20%ofsales.TheBLUEMap
scenario shows strong penetration of hybrids by 2015; plugin hybrid electric vehicles (PHEVs)
andEVsreachsubstantialsales(over5million)by2020;andFCVsbeginsellinginearnestaround
2025. By 2050, plugin and fuel cell vehicles account for more than twothirds of all sales
(Figure32). Though EVs and PHEVs represent only 2% of the world vehicle fleet by 2020, it is
essentialtoreachthoseintermediate(yetfastgrowing)stepsinordertoachievesubstantialEV
penetrationlater(e.g.10%ofstocksby2030andaroundhalfby2050).
Figure32.PassengerLDVsalesbytechnologytypeandscenario(millionsalesperyear)

Technologydeployment
An early indicator for EVs and PHEVs is the availability of vehicles. The numbers and types of
models available to consumers to purchase must be large enough to attract a wide range of
buyers,andthusenablerapidgrowthinmarketshareandsales.Figure33showssomegoodnews
inthisregardthenumberofEVandPHEVmodelsthathavebeenannounced,andplannedtobe Page|59
introducedinthefuture,wasover200attheendof2010.Abouthalfofthesemodelsarefrom
Chinesecompanies,andmostoftherestarefrommanufacturersinOECDcountries.
Figure33.PHEV/EVmodelintroductions
180
160 SOS(startofsales)
140 Announced
Modelnumbers,world
120
100
80
60
40
20
0
2009 2010 2011 2012 2013after
However, plans must become reality; and as of the end of 2010 only about 30 models were
actually available on markets around the world (and far fewer on the market for any one
country).Thisappearslikelytochangesoon,withtheexpectationofabout40moremodelstobe
introducedin2011andcloseto40morein2012.
Figure34.AggregatednationaltargetsforEV/PHEVs
8.0
Canada
7.0
Austria
Netherlands
6.0 Switzerland
EV+PHEVsales(millions)
Ireland
5.0 Israel
UK
4.0 Korea
Denmark
Sweden
3.0
Portugal
Germany
2.0
France
Spain
1.0 Japan
UnitedStates
0.0 China
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Anincreaseintheavailabilityofdifferentmodelswillgiveconsumersgreaterchoiceandmakeit
easier for governments to fully implement EV programmes. The final step will be to see if
consumersrespondbybuying thesevehiclesin thenumbershoped: basedonnationaltargets,
thisamountstohundredsofthousandsworldwidewithinthenext23years,overonemillionper
yearby2015and7millionby2020(Figure34).
Page|60
Policydevelopments
Otherkeyindicatorsarethebudgetscountriesareallocatingfordeployment,throughgrantsand
purchaseincentives,andthepervehiclelevelofincentives.During2010,anumberofimportant
EV/PHEVpolicydevelopmentswereannounced:
Japanannouncedthatby2020,PHEV/EVsaleswouldrepresent1520%oftotalLDVsales.The
country has announced a pervehicle subsidy of half of the price difference between
EVs/PHEVsandabase,comparableICEvehicle.
ChinahastentativelyannouncedastocktargetoffivemillionEV/PHEVsby2020.Thecountry
has announced subsidies of Yuan 60,000 (USD 9100) per vehicle for EVs in pilot cities, with
fundsallocatedthrough2012.
Denmark exempts the vehicle purchase tax for EVs (equivalent to an exemption of 105% of
thecarvaluebelowDKK 76 500 (USD 14400),and180%ofthecarvalueabovethis,plusan
exemptionfromannualregistrationfeeofbetweenDKK500and10,000(USD95and1900).
AdditionalfundingofDKK35million(USD6.6million)isprovidedforatestprogrammewith
businessandmunicipalfleetoperators.
Franceannouncedastocktargetof2millionPHEVs/EVsby2020.Thecountryhasannounced
up to a EUR5000 (USD7000) tax credit per vehicle through 2012 for the first 100 000
vehicles,withatotalbudgetofEUR400million(USD560million).
Spainannouncedstocktargetsof250000by2014and2.5millionby2020.Incentivesoutlined
areup25%ofEVcost,withanupperlimitofEUR6000(USD8200)pervehicle.EUR72million
(USD100million)areallocatedin2011andEUR160million(USD225million)in2012.
Sweden announced a stock target of 600 000 for 2020 and EUR 20 million (USD 28 million)
worthofpurchaseincentivesthrough2014.
The United States announced a stock target of 1 million by 2015 with up to a USD7500
incentivepervehicle,forthefirst200000vehiclessoldbyamanufacturer.TheUSDepartment
ofEnergyisprovidingrelevantfundingandgrantsofoverUSD2billionforbatteryandelectric
drivecomponentmanufacturing.
TheUnitedKingdomhasnotannouncedafirmsalesorstocktarget(though800000onroadby
2020 has been mentioned in reports). An EV/PHEV purchase incentive of GBP5000 (about
USD8000)issetthrough2012.
Taking into account caps, current programmes could result in total expenditures of around
USD20 billion. Total worldwide spending through 2020 could be far higher if incentive
programmes continue, even if incentive levels decline over time. For example, if the average
incentive were USD5 000 per vehicle for the next 10 years, total incentive spending for those
vehicleswouldbeUSD100billionif20millionvehiclesaresold.

Deploymentoflightdutyvehiclefueleconomytechnologies
Improvingthefueleconomyofinternalcombustionenginevehiclesoverthenext10yearsisalso
a priority for cutting fuel use and CO2 emissions. Figure35 demonstrates that there is a wide
rangeofcurrentaveragenewLDVfueleconomy,withcountrieslikeFranceandIndiasellingcars
withthelowestfuelconsumptionperkilometre,whiletheUnitedStatesandAustraliaareamong Page|61
thehighest.Theglobalaveragein2005wasestimatedtobeabout8.1litresper100km(about
29MPG),improvingto7.7litresby2008(31MPG).However,mostoftheimprovementswerein
OECDcountries;nonOECDcountriesoverallexperiencedaslightworseningoffueleconomy.
Figure35.Lightdutyvehiclefueleconomy
10.3 240
Registrations
2005
2008 1million
9.5 220
Testedfueleconomy(gCO2 /km)
10millions
Testedfueleconomy(lge/100km)
8.6 200
7.8 180
6.9 160
6.0 140
5.2 120
Argentina
Cyprus
Slovenia
Belgium
Turkey
Sweden
Luxembourg
Slovakia
Greece
Latvia
Australia
France
Egypt
Lithuania
Russia
Mexico
Portugal
Poland
Denmark
Brazil
SouthAfrica
Hungary
Germany
Chile
Spain
Austria
Finland
China
India
Indonesia
Netherlands
CzechRepublic
Ireland
Thailand
UnitedStates
UnitedKingdom
Malta
Romania
Ukraine
Estonia
Japan
Malaysia
Italy
EU27

Figure36. Average fuel economy trends through 2008 by region, with enacted or proposed
targetsthrough2020

Source:ICCT,2011.
The Global Fuel Economy Initiative has called for a global target of half the 2005 level of
8.1L/100km or about 4L/100km by 2030. As shown in Figure36, good progress in this
directionappearslikelytooccurinOECDcountriesoverthenextfiveyears,thankstorelatively
strong fuel economy standards now in force in most countries. But it will be important to
continuestrongimprovementsafter2015,andthebestwaytodothiswillbeforcountriestoset
Page|62 targets and standards through 2020 and beyond, sooner rather than later. It will also be
importantformorecountriesinthedevelopingworldtosetstrongpolicies,whethertheseare
standardsormarketbasedpolicies(likeCO2differentiatedvehicleregistrationfees).
Policydevelopments
Fueleconomypolicydevelopmentsduring2010included:
UnitedStatessetrevisedCAFstandardsforLDVswithtarget35.5mpgby2016(abouta25%
improvementcomparedtotoday).TheUnitedStatesalsoproposedfueleconomy/greenhouse
gasstandardsforheavydutyvehicles,indevelopment.
EUNewCO2regulationforpassengerLDVswasadopted,requiring120G/kmmaximumCO2
levels by 2015 and 95G/km was adopted in 2009); CO2 standards for commercial vans was
proposedandisunderconsideration(proposal:175gCO2/kmby2014,135gCO2/kmby2020).
China has proposed tightening its fuel economy standards (only nonOECD country with
standards)through2020,but
Manycountries,especiallyintheEU,haveimplementedfueleconomyorCO2basedvehicle
taxation schemes, or bonusmalus schemes (with higher taxes for high fuel
consumption/CO2vehiclesandrebatesforthemostefficientmodels).Thereareawiderange
ofsuchschemesnowinplace,sometimessendingmixedsignalstomanufacturers.
The RD&D data on vehicle efficiency include on and offroad transport vehicles as well as
agricultural transport systems and waste heat recovery. Electric vehicles include infrastructure
andstoragesystemsandhydrogenandfuelcellsformobileapplications.Figure37showsRD&D
spendinginelectric/PHEVandvehicleefficiency.Spendingdramaticallyincreasedsince2003in
all countries, from USD265 million to USD 1.6 billion in 2010. The countries with large vehicle
markets (and manufacturing) dominate the spending: the United States, France, Japan and
Sweden made up more than 80% of total RD&D between 2005 and 2010. Germany shows
surprisinglylowamountsofspendinginthesetechnologyareaswhileAustraliaspentimpressive
amountsbetween2009and2011(USD270million)againstpreviousdecadalaverageoflessthan
USD4 million in the period 199909. No data is available for China and other emerging
economies.FewcountriesrecentlysubmitteddetailedRD&Ddatawhichpermittomakeasplit
ondifferentresearchcategories.Forexample,theUnitedStatesspentoverUSD100millionon
electricvehicles,vehiclebatteriesandEVinfrastructure,atleastUSD280milliononfuelandon
roadvehicleefficiencyandfurtherUSD44milliononothertransportefficiencyin2010.InJapan,
onlyabout10%oftotalbudgetsfortransportefficiencywerespentononroadvehiclesthesame
year. Still, both countries were not able to allocate more than 50% of the amounts spent on
transportRD&Din2010.

Figure37.PublicRD&DspendingonEV/PHEVsandvehicleefficiencyinCEMcountries,2010
200
943
180
160
140
Page|63
MillionUSD2010
120
100
80
60
40
20

Notes:FranceandRussiais2009data,othernonIEAcountriesare2008data
Source:Countrysubmissions.
Figure38 breaks out EV/PHEV spending by various categories for selected countries. The totals
for 200811 show that fuel cell research still ranks high in spending, slightly ahead of battery
research. Other vehicle R&D (such as motors and advanced drive trains) is also significant.
Spending on demonstration projects a form of deployment also received more than
USD1.4billionoverthisperiod.Thisislikelytogrowincomingyears,particularlyintheformof
incentiveprogrammesforpurchasesofEVs,PHEVsandotheradvancedvehicles.
Figure38.PublicspendingonelectricvehicleRD&Dcategoryforselectedcountries200811
1600
1400
1200
1000 Finland
MillionUSD
France
800
Denmark
600 Spain
Sweden
400
Japan
200 Germany
UnitedStates
Battery(mobile FuelCell Vehicle Infrastructure Other/ Demonstrations

onroad) unspecified
Source:Countrysubmissions.
Acronyms,abbreviationsandunits
Thisannexprovidesinformationonacronyms,abbreviationsandunitsusedthroughoutthispaper.
Page|64
Acronyms
BAT bestavailabletechnology
CCS CO2captureandstorage
CEM CleanEnergyMinisterial
CERT carbonemissionsreductiontarget
CFL compactfluorescentlightbulb
CHP combinedheatandpower
CSP concentratedsolarpower
DOE DepartmentofEnergy(UnitedStates)
EE energyefficiency
EMDS electricmotordrivensystems
ENARSA EnergiaArgentinaSA
EPA EnvironmentalProtectionAgency(UnitedStates)
EU EuropeanUnion
EV electricvehicle
FCV fuelcellvehicles
FIT feedintariffs
FYP fiveyearplan
GCCSI GlobalCarbonCaptureandStorageInstitute
GFEI GlobalFuelEconomyInitiative
GHG greenhousegas
GPS globalpositioningsystems
GSHP groundsourceheatpumps
GWEC GlobalWindEnergyCouncil
ICE internalcombustionengine
ICT informationandcommunicationstechnology
IEA InternationalEnergyAgency
IEC InternationalElectrotechnicalCommission
IGCC integratedgasificationcombinedcycle
LDV lightdutyvehicle
LEDs lightemittingdiodes
LLCC leastlifecyclecost
MEPS minimumenergyperformancestandards
MVE monitoring,verificationandenforcement
NDRC NationalDevelopmentandReformCommission(China)
OECD OrganisationforEconomicCooperationandDevelopment
PHEV pluginhybridelectricvehicles
PV photovoltaic
R&D researchanddevelopment
RDD&D research,development,demonstrationanddeployment
RENGEN RenewableEnergyGeneration
RHI RenewableHeatIncentive

S&L standardsandlabelling
SSL solidstatelighting
USC ultrasupercritical
USD UnitedStatesdollar
Page|65
Abbreviations
CO2 carbondioxide
Unitsofmeasure
EJ exajoule
Gt gigatonne
Gtoe gigatonnesofoilequivalent
GW gigawatt
GWth gigawattthermalcapacity
km kilometre
kWh kilowatthour
kWth kilowattthermalcapacity
L litre
L/100km litreper100kilometres
lge litresgasolineequivalent
m2 squaremetre
MJ megajoule
mpg milespergallon
Mt megatonne
Mtoe milliontonneofoilequivalent
MW megawatt
MWh megawatthour
TWh terawatthour
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Clean

U pdat e June 2 011

Such a sweeping revolution will require unprecedented investments in research, development,

Required annual growth Blue Map

Achieving or exceeding levels, maintain the course

Underinvestment in energyefficiency results from an array of market, financial, information,

2000 2002 2004 2006 2008 2020

Canada All renewables

Denmark All renewables

Finland All renewables

Germany All renewables

Mexico All renewables

Norway All renewables

South Africa All renewables

Spain All renewables

Sweden All renewables

UAE All renewables

USA All renewables

* Policies implemented at state/ provice/ territory level

Quota obligaon or green cercate Change in exisng policy scheme

New hydropower development is concentrated in emerging economies. Many OECD countries

Biomassandwaste Biofuels SolarPV SolarCSP Othersolar Wind Geothermal Hydro Other/nonspecifiedrenewables

Battery(mobile FuelCell Vehicle Infrastructure Other/ Demonstrations

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