World Energy Outlook 2006

oad-transport oil demand to be saved by using electricity from the grid, can
yield significant benefits provided the grid becomes less carbon-intensive (see
below). Policies to promote the further development of battery technology
would be essential for these vehicles to be widely deployed. Given the
constraints on land and biomass availability, the level of penetration of biofuels
could only be achieved through the large-scale introduction of secondgeneration
biofuels based on ligno-cellulosic feedstock (see Chapter 14).
Policies to encourage this could include increased research and development,
incentives for construction and operation of biorefineries and minimum
requirements for biofuels in conventional fuel blends.
� Increasing the efficiency of power generation: Inefficient coal-fired
power plants would be retired early and replaced with more efficient coal
plants and hydrogen fuel cells. Retirement of an additional 125 GW of old
coal-fired plants could be involved (in addition to the 412 GW retired in
the Alternative Policy Scenario) between 2004 and 2030. The new coalfired
power plants would achieve an average efficiency of 48%, compared
with 46% in the Alternative Policy Scenario. The equivalent savings in
CO 2 are 0.5 Gt. Policies to drive such early retirements could include
changes in capital depreciation rates, incentives for the installation of
advanced technology and efficiency standards for coal installations. If
hydrogen fuel cells were to supply 550 TWh of electricity more than in the
Alternative Policy Scenario, this could yield another 0.5 Gt of CO 2
savings. Policies to bring this about could include intensified research and
development (to drive down costs), subsidies for building new power
plants and policies to reduce the lending risk of capital for such
investments.
� Increased nuclear power generation: An additional 140 GW of nuclear
capacity would need to be installed by 2030, replacing coal-fired plants. This
would bring the total installed nuclear capacity in 2030 to 660 GW, as
compared with 519 GW in the Alternative Policy Scenario and 416 GW in
the Reference Scenario. Policies to promote such additions might include
more intensive effort to improve waste management, loan guarantees to
reduce the cost of capital and measures to garner public support for nuclear
power.
� Increased use of renewables-based power generation: An additional
550 TWh of hydropower and 550 TWh of other renewables-based generation
would need to be commissioned, each saving 0.5 Gt of CO 2 emissions. With
such additions, renewables-based generation represents a 32% share of
electricity generated in 2030, as compared with 27% in the Alternative Policy
Scenario and 22% in the Reference Scenario. Policies could include research
and development to bring down costs, renewables portfolio standards or feedin
tariffs, and loan guarantees to reduce the cost of capital.
Chapter 10 - Getting to and Going Beyond the Alternative Policy Scenario 259
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© OECD/IEA, 2007