didier tshidimba, managing partner, roland berger strategy consultants (demand drivers and key...

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Gent, March 7, 2012 Vlerick Finance Alumni Didier Tshidimba Trends and drivers of Energy demand

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Page 1: Didier Tshidimba, Managing Partner, Roland Berger Strategy Consultants (Demand drivers and Key Success Factors)

Gent, March 7, 2012

Vlerick Finance Alumni

Didier Tshidimba

Trends and drivers of Energy demand

Page 2: Didier Tshidimba, Managing Partner, Roland Berger Strategy Consultants (Demand drivers and Key Success Factors)

Decentral non-predictable production will play an increasing role in meeting growing energy demand

TotalelectricityDemand

Covered via high-voltage production

Covered via low- & medium voltage

production

TRENDS INELECTRICITY DEMAND

= +

2Vlerick Alumni_Energy demand_vf.pptxSource: Elia; CREG; Eurostat, Roland Berger

> Today's electricity demand still under pre-crisis level

> Demand will increase up to 100 TWh in 2020 and 125 TWh in 2050

90 85> Nuclear energy

covering 50% of electricity demand

> Decrease of relative importance from 96% to 75% in 2050

5> Local production

mainly via PV cells, wind and CHP

> Growing importance of local, non-predict-able production to meet future demand

> Negative effect of improved electrical performance of appliances

> Increased share of con-sumption by services in line with evolution towards a more service based economy

> Decreasing consumption by industry sector as the economy evolves towards less energy-intensive activities

Page 3: Didier Tshidimba, Managing Partner, Roland Berger Strategy Consultants (Demand drivers and Key Success Factors)

Low- & Medium-

Increase in electricity demand will largely be covered by development of low- and medium-voltage production facilities

> Growth in production largely driven by generation connected to distribution network

> Strong increase of wind, CHP and

Electricity production 2010-2050 [TWh]

LOW- & MEDIUM-VOLTAGE PRODUCTION

3Vlerick Alumni_Energy demand_vf.pptx

Medium-voltage production

High-voltage production

Source: Roland Berger analysis

1960 2050

> Strong increase of wind, CHP and biomass, less growth of PV cells (in terms of produced energy)

2010

HIGH-VOLTAGE PRODUCTION

> Historical dominance of nuclear power generation

> Installation of CCGTs and CHP (gas turbines and biomass) compensa-ting for future closure of nuclear plants

Page 4: Didier Tshidimba, Managing Partner, Roland Berger Strategy Consultants (Demand drivers and Key Success Factors)

Electricity demand will continue to grow, although less fast than GDP, due to mitigating factors as RUE and des-industrialization

Demand

GDP1

2

HVAC

Macro-trends

> Development of production facilities

> Healing pumps in new houses

> Rational use of energy (RUE)

200

Electricity demand 2010-2050 [2010=100]

+1.8% p.a.

4Vlerick Alumni_Energy demand_vf.pptxSource: BFP; Roland Berger analysis

2010 2050

Demand 2

3

4

Industrial

New uses/equipment

> More efficient products

> Des-industrialization

> Co-generation/ Auto-production

> Electrical vehicles

> Fuel cells

5Population

> Number of inhabitants

> Buying power

100

145

+1% p.a.

+1.8% p.a.

Page 5: Didier Tshidimba, Managing Partner, Roland Berger Strategy Consultants (Demand drivers and Key Success Factors)

Transmission and distribution network operators are impacted by 3 major evolutions that shape the future energy context

1SMART GRIDS & SMART METERING

> Intelligent grids seen as indispensable in the EU objectives 20/20/20

> Mix of central and decentral production with bidirectional fluxes where consumers are producers at the same time

> Smart meter as a key tool to optimize and reduce energy consumption

> Window of opportunity to launch new services to end-clients

5Vlerick Alumni_Energy demand_vf.pptx

2

3

PRODUCTION UNCERTAINTY

NEWTECHNOLOGIES

> Production fluctuations on 2 levels:

– Cyclical (predictable): Daily & seasonal fluctuations

– Erratic (non-predictable): Climatic and consumer-driven fluctuations

> Increased need for interregional/international network solutions and storage

> Development of RES strongly increasing production uncertainty, with strong impact on the entire network

> Accelerating pace of evolution of emerging technologies for network management and RES

> Required investments to implement innovations exponentially increasing

> New technologies impacting all facets of energy market:

– Structure of distribution/transportation

– Asset management

– Operational performance

Source: Roland Berger

Page 6: Didier Tshidimba, Managing Partner, Roland Berger Strategy Consultants (Demand drivers and Key Success Factors)

To deal with challenges on the energy market, organization need to develop a proper energy sourcing strategy

DEVELOP ENERGY EFFICIENCY PROGRAM

UNDERSTAND ENERGY MARKET MODEL

DEFINE TAILORED SOURCING STRATEGY

A B C

6Vlerick Alumni_Energy demand_vf.pptx

> What are my overall energy needs?

> What are the key drivers of my energy consumption?

> What are the critical points on my energy needs?

> How and where can I reduce my energy consumption?

> How does the market for gene-ration, supply and trading works?

> Who are the key actors in each market segment?

> What are the possibilities of energy trading & portfolio management (TPM)?

> What is the load profile and variability of my consumption?

> What is the degree of predictability of my energy needs?

> What is the optimal mix of energy sources?

> Should I develop own generation capacity (partnerships, auto-production)?

Source: Roland Berger

Page 7: Didier Tshidimba, Managing Partner, Roland Berger Strategy Consultants (Demand drivers and Key Success Factors)

It's character

impact!that creates

It's character