10 predictions of global energy reform: the new global photovoltaic installed capacity will continue

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Polaris Solar Photovoltaic News: As playwright Sophocles said nearly 2,500 years ago, 'No one likes messengers who bring bad news.' What is encouraging is that this year Bloomberg New Energy Finance (BNEF) released Among the 10 major predictions of energy development in 2019, more positive information will be shown to people-the world is constantly progressing towards a 'cleaner future' in 2019. A signed article recently written by Angus McCrone, editor-in-chief of Bloomberg New Energy Finance, shows that as the cost of photovoltaics, wind power and lithium-ion batteries continues to decrease, low-carbon transformation will progress steadily this year. This is due to the increasing recognition of investors and companies The importance of 'sustainability', on the other hand, may be due to consideration of self-interest. The 2019 BNEF10 forecast basically covers clean energy, battery energy storage, electric vehicles, US natural gas, international LNG market, oil market, digitalization and Internet of Things, and the future development direction of China's energy transformation and other fields, providing investment and decision-making for enterprises reference.

Perhaps 'steady progress' sounds a bit tedious, because at least from the perspective of January this year, 2019 will still be a year of wider economic and political turmoil around the world. In this context, 'steady progress' means 'elastic change'.

Here are a few cases that are not too 'sunshine'-the S&P 500 index shows that in the three months ended December 26, 2018, the stock market plummeted by nearly 20%, which seems to be 'dragging' on the surface. Global GDP growth. Financial markets are known for their ability to effectively predict economic recession. Although we cannot conclude on the development of the global economy, it is at least a warning sign.

Let’s look at other negative factors. From the perspective of developments in January, the House of Representatives led by the US Democratic Party investigated President Donald Trump, making it difficult not to be uneasy about the risk of a political crisis in the United States. Without a deal with the United Kingdom, Brexit triggered a crisis in Europe, and the pressure on the world economy is becoming more obvious.

The economic and political issues in 2019 are likely to affect the investment flow of 'cleaner future', but investment will not be terminated. In fact, we anticipate that this year, such as how to balance wind power, photovoltaic large-scale power generation systems, how to make renewable energy zero-subsidy on-grid related investment, and respond to 'decarbonization' and other challenges, will present more than ever More innovation.

Next, I will analyze BNEF's 10 predictions for the development of the world's energy system in 2019, including an overview of clean energy development, wind power and photovoltaics, battery storage, electric vehicles, American natural gas, international liquefied natural gas, oil market, digitalization, and The development direction of China's energy transformation and other fields. These results all come from the research results of each branch of BNEF.

Lower costs lead to lower investment

Every year, clean energy investment must be accelerated to maintain the level of the original investment. As the cost of wind power, especially photovoltaics, continues to decline, the world has to expand more and more capacity to match the total investment in the previous period.

There is a 'mutual' relationship among them. For example, the new production capacity increased sharply in 2017, and the related investment also increased accordingly. However, in 2018, only the production capacity increased. I believe that the situation of 2018 will be reproduced in 2019. .

The new wind power and photovoltaic equipment in 2019 should be more than last year (see forecasts 2 and 3), but the installed cost of photovoltaics in 2018 has fallen sharply, with a decrease of about 12%. This is mainly due to the market situation of oversupply. resulting in.

In addition, 2018 is also a glorious year for offshore wind power, with an overall investment of 25.7 billion U.S. dollars. This achievement is due to the construction of five projects in Europe with an investment of 1 billion to 3.5 billion U.S. dollars, and China’s Investment of less than 13 arrays.

Although the medium-term investment prospects are bleak (see Forecast 3), it will still be a difficult 'fight' to surpass the previous total investment. It is more likely that the overall investment in clean energy will decline slightly in 2019. In addition, the weakness of emerging stock markets may mean that investments in clean energy in the open market will be lower than the investment of US$10.5 billion in 2018.

But I still believe that clean energy investment will still see a considerable number in 2019-close to US$300 billion for the sixth consecutive year, but it is far from last year's US$332.1 billion.

Despite the relevant policies adopted by China, the global new photovoltaic installations will continue to grow in 2019

According to the final data, the new installed capacity of photovoltaics in 2018 will eventually reach 109 GW. In the coming year, there may be a growth of 125 GW to 141 GW-Europe is deploying again to build more photovoltaic panels, and India, the Middle East, North Africa and Turkey are continuing to expand the scale of construction.

China is currently the world's largest photovoltaic market, and the Chinese government is trying to reconcile the gap between future photovoltaic support policies and the renewable energy fund of 150 billion yuan (approximately $23.4 billion) by the end of 2017.

At the same time, emerging markets have been conducting relevant auctions and tenders to purchase cost-effective photovoltaic power generation. Although the relevant government hopes to set a new record in 2019, the expectations are not optimistic.

Of course, the performance of photovoltaic power generation costs and performance will continue to improve, and the sharp price drop last year will not be repeated. At the same time, some companies may withdraw from the market, but the formation of manufacturing will become more competitive, and related technological innovations will be around floating photovoltaic panels, double-sided modules, and large-scale energy storage and photovoltaic power generation in the field of public utilities. Combined technology.

Onshore wind power is booming

The wind power market will see a leap in new capacity, from 53.5 GW in 2018 to more than 70 GW in 2019. Northern Europe, China and the United States are continuing to promote onshore wind power projects, many of which have been awarded in 2018 financial support. The additional installed capacity of offshore wind power may increase from 4.8 GW to 8.5 GW.

In the field of offshore wind power, Europe will build a new capacity of 4.9 GW in 2019 and 3.5 GW in Asia, both of which are record numbers. After this, Asia will become a more leading market in this field. According to BNEF's forecast, by 2020, Asia's production capacity will be 25% more than Europe. Offshore wind power will gradually become a 'necessary variety' in power generation technology, which will be gradually realized through 'attractive' price drops and 'inspiring' scale construction.

In the wind power industry, the price of generators has shown a significant decline. According to the 2018 BNEF Wind Power Price Index, wind turbine prices have fallen by 17% since December 2016. We predict that the MW construction cost will temporarily stabilize below US$800,000 in 2019. This will be a 'very real' moment for onshore wind turbine manufacturers and suppliers.

In the past two years, industry participants have actively explored and tried to save costs and improve efficiency, and now it can be said to be a highlight moment of 'dreams into reality'. At the same time, this is also likely to trigger further cost reductions and industry consolidation, especially in China and India.

Energy storage increased to 10 GWh for the first time

The global energy storage deployment will exceed 10 GWh in 2019, which is the first time in the history of this market. This includes the scale of utilities and 'after-metering' energy storage equipment, which will be an increase of 8 GWh (4 GW) from last year's estimated installation.

Despite the threat of a trade war, Chinese battery manufacturers will still form a real global influence. Related auto companies will gradually expand cooperation with Chinese battery suppliers to expand sales in China. Especially in the 'busy' state of the Korean domestic market, international energy storage developers and integrators will pay more attention to the development of China's battery industry.

Fierce competition and the recent easing of cobalt and lithium costs will push the average price below $150 per kWh. According to the price curve, the price of electric vehicle batteries will even fall below this level. At the end of 2018, the price of battery modules had fallen to a record low of US$176 per kWh.

Electric vehicle sales growth rate is 40%

At present, there are about 5 million electric passenger vehicles worldwide (including buses and other commercial vehicles). We expect another 2.6 million sales to occur in 2019, which represents a growth rate of approximately 40%, which is lower than the growth rate of 70% in 2018. China will once again lead with sales of 1.5 million vehicles, accounting for about 57% of the global market share.

The Chinese market is in a stage of transformation, and it seems unlikely that the rate of annual sales will double in 2019. We expect the subsidy to decline in February, but the 'phase-out period' will continue into the second quarter

'New energy vehicle quota' will show its effect this year, but the public's demand for new energy vehicles is still conservative. Broader macroeconomic factors (increasing interest rates and slowing consumer spending) will also affect global sales. In markets such as the US and the UK, direct purchase subsidies have begun to gradually decline.

BNEF expects that sales of electric vehicles in Europe will be less than 500,000, but sales growth in Northern Europe and Germany should be relatively strong. Sales in Italy have been slow, but will pick up in 2019, while sales in the UK will remain flat or decline after the government cancels support for plug-in hybrids. Sales in North America will roughly increase from 405,000 to 425,000. The advent of the Tesla Model 3 in 2018 boosted sales that year, but unless lower-cost models can be quickly introduced, this momentum will be difficult to maintain. Japan and South Korea's total sales remained roughly 100,000.

New infrastructure inspires US natural gas exports

Assuming that the climate is in a normal state, it is expected that the average US natural gas benchmark price will remain between US$2.5 and US$3.5/MMBtu in 2019. Therefore, the growing demand in the southern part of the country will once again be met by sufficient production in the northeast. In 2018, the United States 'unlocked' more natural gas production. Although the upstream price has slightly increased, the output in 2019 will continue to increase. Therefore, the price of natural gas in the central and western regions will gradually decline, which will also make natural gas in this area. Countries that have always attached importance to coal-fired power generation have more competitive advantages. In 2019, natural gas will continue to penetrate in the Midwest.

In the south, natural gas production in West Texas will continue to be restricted because the new capacity to deliver natural gas to the Gulf Coast will not be commissioned until 2020. In 2019, weak natural gas prices in West Texas should be a widespread phenomenon.

At the same time, I expect natural gas exports from the Gulf region to benefit from three newly added projects: one is the second LNG transport train built at the Corpus Christi LNG transfer terminal, and the other is the opening of three new LNG exports Facilities; the third is to complete the construction of 2.6Bcfd submarine pipeline in order to export natural gas to Mexico.

LNG maintains strong growth for the third year

Although the average price of LNG in 2018 was US$10/MMBtu, which was higher than the average price of US$7/MMBtu in 2017, the global demand for LNG in 2018 reached 313 million metric tons, a 10% surge from the previous year. In this regard, I expect the global LNG trade to expand further by 8% to reach 340MMtpa.

As China adopts relevant policies to reduce coal consumption to reduce pollution, the country will continue to play a 'key role' in the LNG field. At the same time, due to the development of gas and power and the increase in electricity demand, infrastructure construction, and the gradual reduction of local natural gas production, South and Southeast Asia will also have a higher demand for the import of liquefied natural gas.

At the same time, because Japan is restarting nuclear energy more slowly than expected, Japan will obtain contract output from its LNG supply project invested in Australia. Europe will further increase imports, especially at present, compared with Asia, Europe and the United States import and export cooperation is closer. In 2018, Europe imported 6MMt of liquefied natural gas, and its total import volume reached 50MMtpa, the highest level since 2011.

Compared with coal prices, the price of LNG plays a more prominent supporting role in the supply and demand relationship. Due to tight supply, coal futures prices remain high (US$90~US$100/ton), which makes importing LNG an attractive option. The newly added 30MMt LNG supply capacity in 2019 will be sufficient to support the expected demand growth and stabilize its price performance in the spot market.

Iranian oil prices are stable

Crude oil experienced rough waves in 2018. In the first nine months of 2018, both Brent and WTI showed an increase, but in the fourth quarter they were 'annihilated', falling 19% and 26% respectively. The drivers of large fluctuations are mainly the increase in US production, the effect of US sanctions on Iran, and the uncertainty of OPEC’s response to the decline in oil prices. These situations have become more complicated due to increased macroeconomic risks.

These factors driving oil price volatility will continue in 2019, but we expect crude oil prices to be at a positive level by the end of this year as the US sanctions on Iranian oil exports expire. If the Fed adopts a relatively moderate stance and the crisis effect caused by Sino-US trade friction is further weakened, we expect the price volatility of crude oil to further calm down.

The industrial field will pay more attention to the construction of the Internet of Things

Industrial equipment manufacturers have recently invested billions of dollars in the Internet of Things, artificial intelligence, asset automation and sensors. This will help sell digital software to existing customers and generate a small portion of revenue from it.

However, companies such as General Electric (GE), Siemens (Sie-mens), Hitachi, ABB, and Schneider will have much greater ambitions and layouts in this area, but their development will also be constrained by some software startups and large technology giants. Fierce competition.

Energy companies usually do not own the best or most economical IoT software products, and buying software from equipment manufacturers is not ideal for customers. In 2018, both Schneider and GE applied their digital technology to independent companies-Schneider invested its software assets in Aveva and currently owns 60% of the shares. GE announced the establishment of an unnamed independent in December 2018 entity.

Schneider tried to create a more flexible software entity to seek more non-Schneider customers on a larger scale. GE may also achieve the same goal in the long run, but recently it has focused more on its parent company

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