Frenchexperienceonlongtermenergy&climateplanning

PresentationtotheVisionCommittee,MOEJ,Tokyo,29November2016

RichardLavergne,SeniorAdvisortotheGeneralDirectorforEnergyandClimateandtotheHighCommissionerforSustainableDevelopment,

FrenchMinistryforEnvironment,EnergyandtheSea

FrancewithintheEU

2

Population(1/1/2016)- EU28:510M- France:67M

GDPpercapita(marketprices)(2014)- EU28:€27,500- France:€32,300

TotalFinalEnergeticConsumption(2014)- EU28:1,062Mtoe- France:142Mtoe

EUClimateAction• KeyEUtargetsfor2020

http://ec.europa.eu/clima/policies/strategies/2020/index_en.htm

• 20%cutinGHGemissionscomparedwith1990(-10%fromnonEU-ETSsectorsand-21%fromtheEU-ETS)

• 20%oftotalenergyconsumptionfromrenewables• 20%increaseinenergyefficiency

• KeyEUtargetsfor2030http://ec.europa.eu/clima/policies/strategies/2030/index_en.htm

• Atleast40%cutinGHGemissionscomparedwith1990(-30%fromnonEU-ETSsectorsand-43%fromtheEU-ETS)

• Atleast27%oftotalenergyconsumptionfromrenewables• Atleast27%increaseinenergyefficiency

• Long-termgoal• By2050,theEUaimstocutitsGHGemissionssubstantially– by80-95%comparedto1990levelsaspartoftheeffortsrequiredby

developedcountriesasagroup• TurningEuropeintoahighlyenergyefficientandlow-carboneconomywillalsoboosttheeconomy,createjobsandstrengthen

Europe'scompetitiveness

• Actiontowardsclimatetargets• TheEUispursuingitsclimatetargetsthroughacombinationoffinancialsupport andregulation

• Adaptingtoclimatechange• TheEUCommissionhasadoptedanEUAdaptationStrategy andwantsallitsMStoadoptnationalplansby2017

3

-40% -35% -30% -25% -20% -15% -10% -5% 0%

LU SE DK FI DE FR UK NL AT BE IT IE ES CY MT PT EL SI CZ EE SK LT PL HR HU LV RO BG EU

MemberStateGHGemissionlimitsin2030comparedto2005(nonEU-ETS)

EUReferenceScenarioto2050

• EU28GrossInlandConsumption(Mtoe) • EvolutionofCO2emissions(Mt)bysector

4Energy,transportandGHGemissions- Trendsto2050:lasteditionpublishedinJuly2016http://ec.europa.eu/energy/en/data-analysis/energy-modelling

Source:PRIMES

TheFrenchenergysituationinanutshell

5

Grossinlandconsumption:257Mtoe Totalfinalenergyconsumption:162Mtoe

Grosselectricitygenerationbyfuel:569TWh

Datafor2015

67%fossil

Nationalstrategyforecologicaltransitiontowardssustainabledevelopment(SNTEDD)

• Latesteditionwww.developpement-durable.gouv.fr/National-Strategy-of-Ecological,44461.html adoptedbytheFrenchgovernmentinFebruary2015fortheperiod2015-2020toovercome4keyenvironmentalchallenges:• Climatechange• Acceleratedlossofbiodiversity• Resourcescarcity• Increasedhealthrisks

• Unifyingandcoherentframeworkformanythematicorsectoralstrategies(biodiversity,adaptation,agriculture,floodrisks,…)

• Policiesguidelinestoreconcilelong-termandshort-termintereststhrough9cross-cuttinggoalsandpriorities

• Setofindicatorstomonitor/followtheimpactoftheSNTEDD:http://www.statistiques.developpement-durable.gouv.fr/indicateurs-indices/li/indicateurs-nationaux-transition-ecologique-vers.html

6

NationalDebateonEnergyTransitionin2013• FourpreliminarypathwayswereissuedattheendoftheNationalDebate

Source:PatrickCriqui,CNRS(viaIDDRI)7

Frenchlegislationforenergytransition(lowcarbonsociety):3majorimpetus

• NationalDebateonEnergiesand“POPE”SteeringLawof13July2005• CutofGHGemissionsof75%by2050(3%/y)andsupport-50%atWorldlevel• Decreaseofthefinalenergyintensityof2%/yfrom2015and2.5%/yfrom2030

• “Grenelle del’Environnement”Initiative in2007-2010• “Grenelle 1”SteeringLaw#2009-967of3/8/2009

• Ambitioustargetsforbuildings(50kWh/m²/yearfornewbuildings,-38%energycons.forexistingbuildings,energyauditsofStatebuildings,…)andtransportation

• Applicationof”Factor4”andoftheEU“3x20%”policy• “Grenelle 2”Act#2010-788of12/7/2010toimplement“Grenelle 1”• YearlyFinanceLaw:CITE,Eco-PTZ+,bonus-malus,etc.• EnergyR&D:PIA,Competitivenesspoles,…

• EnergyTransitiontowardsGreenGrowth:on-goingprocesssince2012• NationalDebateonEnergyTransitionfromNov.2012toJuly2013• EnvironmentalConferenceofSept.2013withPresidentHollandedeclaration• EnergyTransitiontowardsGreenGrowthAct(LTECV)#2015-992of17/8/2015• YearlyFinanceLawsfor2015,2016and2017

Moreandmore:- InvolvementofNGO’s- ImprovementofEEand

developmentofrenewables- Localauthoritiesempowerment

8

Manyquantitativeobjectivesto2030and2050inLTECV,amongwhich:

Carboncomponenttrajectoryupto

€100/tCO2in2030

€

9DuringtheCOP22,theFrenchPresidentofFranceannouncedhiswishthatFrancereachcarbonneutralityby2050

Threemaintoolstokeepmomentumintheenergytransition,asmentionedintheLTECV

• NationalStrategyforlow-carbondevelopment(SNBC)2015-2028(*)• TheGovernmentimposed,bysuccessive5-yearsperiods,3GHGemissionsceilings(“CarbonBudgets”)thatFrance

shouldnotexceed• Inordertomeetthiscommitment,theSNBCissetupfor3successive5-yearsperiods• Allfuturenationalpolicies(forinstancetransport,spatialandinfrastructureplanningandenergyproduction)should

takeitintoaccount

• Multi-annualProgrammingforEnergy(PPE)2016-2023(**)• Governmentalactionplanthatdefineditsprioritiestosupportvariousformsofenergyorenergysavings,inlinewith

theSNBC:• Energyefficiencyandrenewables• Securityofsupply• Balancebetweensupplyanddemand

• PPEissetupfor2successive5-yearsperiods

• Empowermentofregionalandlocalauthorities• Includingvariousstrategic/actionplanningterritorialexercises(SRADDET/SRCAE,PCAET,SRB,S3RENR,TEPCV,…)

(*)Adoptedbydecreeof18November2015(**)Adoptedbydecreeof27October2016 10

TheFrenchNationalLowCarbonDevelopmentStrategy(SNBC)(1/8)

• SNBCdefinesstrategicorientationstoimplementGHGemissionsreductionineachsectorofactivityinaccordancewithLTECV• Basedonastudymadefrommid-2014tomid-2015todevelopGHG/energyscenariosto2035:WEMandWAMscenarios(*)• AssociatedwithCarbonBudgets,i.e.ceilings/upperlimitsofGHGemissionsatnationallevel,of5yearseach,until2028,withindicative splitbysectorofactivity• BasedontheseCarbonBudgets,itiseasiertoassessthetendencyforthedecreaseofGHGemissions(independentlyofweatherconditions,geopoliticalcrisis,…)

• Scenarios,CarbonBudgetsandSNBCshouldbeupdatedandextendedbyJuly2019

(*)WEM=WithExistingMeasures(BaU Scenario)WAM=WithAdditionalMeasures(ReferenceScenario)

11

TheFrenchNationalLowCarbonDevelopmentStrategy(SNBC)(2/8)

• PrimaryconsumptionoffossilfuelsinWEMandWAMscenarios

• GHGemissionsinWEMandWAMscenarios

12Seewww.developpement-durable.gouv.fr/scenarios-a-l-horizon-2020-2030.htmlWEM=WithExistingMeasures(BaU Scenario)WAM=WithAdditionalMeasures(ReferenceScenario)

129 126 126 128 132129119

106 109

91

0

20

40

60

80

100

120

140

2012 2015 2020 2025 2030

Mtoe

FossilprimaryenergyconsumptioninWEMandWAM2scenarios

WEM

WAM2

-30%

551

478 468 465 467 470

556517

457

407366

317286

0

100

200

300

400

500

600

1990 2000 2010 2015 2020 2025 2030 2035

MtCO2eq

GHGemissionsinWEMandWAM2scenarios

WEM

WAM2

TheFrenchNationalLowCarbonDevelopmentStrategy(SNBC)(3/8)

• Acontinuousprocessofupdatingandextension

13

TheFrenchNationalLowCarbonDevelopmentStrategy(SNBC)(4/8)

• Concertationprocessallover2015• Communicationwithvariouscommittees,incl.• EnvironmentalAuthority• CETE=Committeeofexpertsforenergy

transition:8academics• CNTE=NationalCouncilforEcological

Transition:50delegates• Severaldedicatedmeetingsbothonthescenarios

andthedraftSNBC• Consultationofthepublic

• PublicationofSNBC• Decreeof18November2015

https://www.legifrance.gouv.fr/jo_pdf.do?id=JORFTEXT000031493783 togetherwithareportprovidingorientationsandrecommendationswww.developpement-durable.gouv.fr/IMG/pdf/SNBC_Strategie_Nationale_Bas_Carbone_France_2015.pdf andEnglishsummary:www.developpement-durable.gouv.fr/IMG/pdf/15147-2_strategie-bas-carbone_4p_GB.pdf

• CNTE• ChairedbytheFrenchMinisterofEnvironment,EnergyandtheSea

• Composition:

14

TheFrenchNationalLowCarbonDevelopmentStrategy(SNBC)(5/8)

Transport(28%)

Building /Dwelling(20%)

AgricultureForestry(19%)

Industry(18%)

Energybranch(12%)

Waste(4%)

TargetsReduceGHGemissionsby29%bythe3rd carbonbudgetperiod(2024-2028)comparedto2013andbyatleast2/3betweennowand2050

Reduce emissionsby54%bythe3rd carbonbudgetperiodcomparedto2013andbyatleast87%by2050 +Cutenergy consumptionby28%by2030comparedto2010

Reduceagricultural emissionsbymorethan12%bythe3rdcarbonbudgetperiodcomparedto2013andby50%throughtheagro-ecologyproject

Cutemissionsby24%bythe3rd carbonbudgetperiodandby75%betweennowand2050

Keepemissionsbelowthe2013levelduringthe1st3carbonbudget periodsandreduceenergyproduction-relatedemissionsof96%by2050vs.1990

Reduceemissionsby33%bythe3rd carbonbudgetperiod

MeansEnergyefficiencyofvehicles(2l/100 kmforvehiclessoldin2030)

Implementthe2012thermalregulationandanewone

Increasetheimplementation oftheagro-ecologyproject

Manage thedemandforenergyandmaterialsperproduct

Reduceenergydemandandcarbonfootprint

Reducefoodwasteandpreventproductionofwaste

Lowcarbonsupplysystems(vehiclequotasinpublicfleets,electricchargingstations,…)

Renovateentirelythestockofbuildingstohighstandardsofefficiencyby2050(BBC)

Promoteaverysignificantincreaseintheamountofthewoodharvested

Promotecirculareconomy

Continue todeveloprenewables

Increaserecyclingandsorting

Demandside(cityplanning,teleworking,occupancyratein vehicles,…)

SpeedupDSM(eco-design,Linky,etc.)

ReducetheshareofGHGintensiveenergysources

Improvetheflexibilityoftheenergysystem

Reducediffusemethaneemissions

Promote alternativestoprivatecars

Ultimatelystopincinerationwithoutenergyrecovery

Encouragemodalshift 15

TheFrenchNationalLowCarbonDevelopmentStrategy(SNBC)(6/8)

• Carbonbudgets:anillustrationwithacompatibleGHGemissiontrajectory

• Indicativesectoralsplitofthe3firstcarbonbudgets(incl.overseasterritories)

WasteAgricultureEnergybranchIndustryDomestic&TertiaryTransport

16

TheFrenchNationalLowCarbonDevelopmentStrategy(SNBC)(7/8)

• GHGemissions(andenergy)evolutionspersectorwithrespecttotheBaU scenario

• Yearlyaverageemissions

GHG(energy) 1st CarbonBudget(2015-2018)

2nd CarbonBudget(2019-2023)

3rd CarbonBudget(2024-2028)

Waste -8% -14% -21%

Agriculture -5% -8% -11%

Energybranch -14% -19% -28%

Industry -4%(-5%) -8%(-8%) -16%(-13%)

Domestic&Tertiary -8%(-4%) -20%(-10%) -34%(-17%)

Transport -7%(-5%) -18%(-12%) -27%(-18%)

TOTAL -7% -15% -23%

Yearlyaverageemissions(MtCO2eq)

1990 2013 1st Carbon Budget(2015-2018)

2nd Carbon Budget(2019-2023)

3rd Carbon Budget(2024-2028)

EU-ETS(excl.internationalflights) 119 110 #N/A #N/A

Othersectors 373 332 #N/A #N/A

TOTAL 552 492 442 392 358 17

TheFrenchNationalLowCarbonDevelopmentStrategy(SNBC)(8/8)

• SNBCwasassessedforitsmacro-economicimpactswiththe Three-MEmodel(ADEME&OFCE),seewww.development-durable.gouv.fr/IMG/pdf/Thema-SNBC.pdf (Frenchonly)

• ComparisonwithaBaU scenariogivesthefollowingresultsoverthenext2decades(2015-2035):• ImpactonGDP=+1.6pointin2035vs.BAU(mainlybecauseofinvestmentsinnewbuildingsover2017-2021)• Jobscreation=+400,000(netcumulativegain)in2035vs.BAU

In%

18

Multi-annualProgrammingforEnergy(PPE)(1/5)

• LTECVmergedseveralplanningdocumentsforvariousenergyforms(electricity,gasandheat)intoasingleinstrument,PPE,andwidenstheirscopetoincludeconsumption,networksandsecurityofsupply

• PPEdefinesprioritiesofpublicactioninanintegratedandglobalenergyapproachinordertoachievetheLTECVgoals

19

Multi-annualProgrammingforEnergy(PPE)(2/5)

• PPEanalysisincludesvariousenergydemandscenariostakingintoaccountdifferentassumptions(macroeconomicoutlooks,demographicforecastandenergyefficiencyoutlooks)

• Twomainscenarioswereconsideredforenergydemand• PPEReferenceScenario:-13%in2023(comparedto2012),thatiscompatiblewithLTECVtargetof-20%in2030

• PPEsensitivityanalysis:-3%in2023(comparedto2012)

110

115

120

125

130

135

140

145

150

155

160

2012 2018 2023 2030

Mtep

Référence2012 Variante Scénarioderéférence Objectif203020

Multi-annualProgrammingforEnergy(PPE)(3/5)

Energyefficiency Renewables Cleaner mobility Securityofsupply Longerterm

Targets (2023)-12% forthefinalenergeticconsumption-23%fortheprimaryconsumptionoffossilfuels(inlinewith-30%in2030)

+70%for installedcapacityofelectricrenewablesand+35%forrenewableheat,comparedto2014(inlinewiththeglobalobjectiveof+32%in2030)

Cutenergyconsumptionintransportof13%

Demandsideresponse upto6GW(incl.erasing)Preservehighlevelreliabilitystandards(electricity,gas)

Hydraulicstorageof1to2GWbetween2025and2030

Means(2023)Tocutenergyconsumptioninbuildingsof 15%by2023

Scheduleofcallsfortenders 2.4 millionEVsandplug-inhybridvehicles

Nonewcoal plantbutCCSready

Deploymentofsmartgrids

Thermalrenovationof500,000dwellings/y from2017

Simplifications Installationof1millionchargingpointsby 2020

CapacitymechanismtobelaunchedinJanuary2017

Supportofstoragesolutions

Financingtools Participatory finance(crowdfunding)

3%truckstobesuppliedwithNGVand20%bio-NGVwithinglobalNGVconsumption

Ensureavailabilityofgasstorageinfrastructuresanddevelopmentofgasinterruptibility

Supportofauto-consumptionandauto-production

Whitecertificates Extendheatfunding Advancedbiofuels Ensureaneffectivedistributionofoilstrategicstocks

Engage-10to-65TWh ofnuclearpowerby2023

Etc. Etc. Etc. Etc. 21

Multi-annualProgrammingforEnergy(PPE)(4/5)

• AlmostthesameconcertationprocessasforSNBC• Communicationwithvariouscommittees,incl.

• EnvironmentalAuthority• CETE=Committeeofexpertsforenergytransition:8academics• CNTE=NationalCouncilforEcologicalTransition:50delegates• Consultationofthepublic

• PublicationofPPE• Decreeof27October2016togetherwithareportprovidingorientationsandrecommendationswww.developpement-durable.gouv.fr/IMG/pdf/PPE-complet-1.pdf (Frenchonly)

22

Multi-annualProgrammingforEnergy(PPE)(5/5)

• ThetwomainPPEscenarioswereassessedfortheirmacro-economicimpacts,thesamewayasSNBC,seewww.development-durable.gouv.fr/IMG/pdf/7_-_Volet_Impacts_economiques_et_sociaux.pdf (Frenchonly)

• ComparisonofthePPEReferenceScenariowithaBaU onegivesthefollowingresultsover2014-2030:• ImpactonGDP=+1.1pointin2030vs.BAU(mainlybecauseofinvestmentsinnewbuildings,asforSNBC)• Jobscreation=+280,000(netcumulativegain)in2030vs.BAU

In%

23

NationalStrategyforEnergyResearch

• SameprinciplesofconcertationprocessasforSNBCandPPE• InvolvementofANCRE,NationalAlliancefor

CoordinationofEnergyResearchwww.allianceenergie.fr• ConformitywithSNBCandPPE• CoherencewiththeEUSET-Planhttps://setis.ec.europa.eu

• Mainobjective:toidentifyandtostructurebigissuesandchallengesinresearchandinnovation,atvarioustimehorizonsupto2050,tomeetLTECVgoals• Decisionsupporttoolforthegovernmentrather

thanaprogrammingdocument• Forinstance:

• TodevelopatransversalapproachforEnergyR&Dinordertobettertakeintoaccountenvironmentalissues,humanitiesandsocialsciencesanddigitalchallenges

• Topreparenewtoolstomanageflexibilityandsophisticationoftheenergysystematdifferenttimehorizons

• FrenchgovernmentalexpensesforenergyR&D(inM€)

24

0

200

400

600

800

1 000

1 200

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Budg

et d

épen

sé (M

€)

Domaines de recherche transverses et non classésEnergies fossilesNouvelles technologies de l'énergieEnergie nucléaire

0

200

400

600

800

1 000

1 200

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Budg

et d

épen

sé (M

€)

Domaines de recherche transverses et non classésEnergies fossilesNouvelles technologies de l'énergieEnergie nucléaire

OtherfieldsandtransversalresearchFossilfuelsNewenergytechnologiesNuclear

Carbonpricing:CarbontaxandEU-ETSarecoexistinginFrance

• FrenchCarbonTaxsince2014• Growthiscompensatedbytaxcutinfavourofenergytransition(taxcredit,…)

• EU-ETS• Operatesinthe28EUcountries+• LimitsGHGemissionsfrom:

• Approximately11,000energyintensiveinstallationsandmanufacturingindustrysectors

• Operatorsofflights• Capandtrade:intheperiod2013-2020,thecapisreducedby1.74%everyyear(i.e.-21%in2020comparedto2005)

• Priceiscurrentlybetween4and6€/tCO2

0

10

20

30

40

50

60

70

80

90

100

2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030

en€/tCO2

25

ImportanceofcarbonpricingintheEU(1/2)• FranceisinfavourofabetterEUcarbonpricingbecausethecurrentpricesignalisnotenoughandtoovolatiletosupport

cleanenergyandtogetprogresstowardstheatleast-40%GHGEU2030target(-30%nonEU-ETSsectorsand-43%EU-ETS)

• Negotiationsareunderwaybetweenthe28MSswithproposalssuchas“pricecorridor”,“carbonfloor”,benchmarks,etc.

26

ImportanceofcarbonpricingintheEU(2/2)• Ex-postevaluationoftheimpactoftheEU-ETS,Renewable,TaxationandotherpoliciesonCO2emissionsfromcombustion

• Climatepolicyworksasitreducesemissionsandstimulatestheuptakeofcleantechnologies

27

Integrationoftheclimateriskwithintheannualreportingofcompaniesandinstitutionalinvestors

• Forinstitutionalinvestors• Since2012,portfoliomanagementcompaniesandfundmanagementcompanieshavetoreporton

environmental,socialandgovernance(ESG) criteriathattheyuseintheirinvestmentpolicy(supporttoSociallyResponsibleInvestment)

• Decree#2015-1615of10December2015setupthe“EnergyandEcologicalTransitionfortheClimate”governmentallabel• 9 fundshavebeenlabelledsofar,foratotalamountofassetsundermanagementofb€1.2

• Decree#2015-1850of29December2015mademandatoryforlargeinstitutionalinvestorstoreportannually,from1st January2017,onthemeanstocontributetotheenergyandecologytransitions,including:• Carbonfootprintofportfolios• Greenpartoftheirinvestments• Lowcarbondevelopmentstrategysetuptofightagainstclimatechange

• Frenchpublicfinancialinstitutions(CDC,AFD,BPI,…)havebeenencouragedtolaunchgreenbondsthatwouldbededicatedtoenvironmentalinvestments

• TheFrenchgovernmenthasannounceditsintentiontolaunchasovereigngreenbond• Forcompanies

• Since2001,Frenchlegislationhasrequiredlargecompaniestoprovideextrafinancialreportingonenvironmental,socialandgovernance(ESG)aspects,includingrisksanduncertainties

• Decree#2016-1138of19August2016mademandatoryforthemtoreportannually,from1st January2017,onsignificantitemsofGHGemissionsduetothecompaniesactivities,includingthroughtheuse ofgoodsandservicesthattheyproduce

28

Thankyouforyourattention!MoredetailsontheMinistrywebsitewww.developpement-durable.gouv.fr

andinthelasteditionofthe“Panorama”www.developpement-durable.gouv.fr/Sortie-du-rapport-Panorama.html

E-mail:richard-1.lavergne@developpement-durable.gouv.fr

29