Engie S.a. · EURONEXT:ENGI
Engie — DPE Media Day Pres 1111 ENGLISH 1
30 slides from Engie's investor presentation, Nov 12, 2024
Slide 1: Achieving Europe's Decarbonization
ACHIEVING EUROPE’S DECARBONIZATION ENGIE’s Decarbonization Pathway for Europe 12 November 2024 NOVEMBER 2024 1
Slide 2: Achieving Europe's decarbonization
Achieving Europe’s decarbonization 1. Methodology & key indicators 5. Energy transition costs 2. Final demand 6. Emissions 3. Renewables & flexibility 7. Ambitions at risk 4. Low Carbon molecules 8. Summary and call to action NOVEMBER 2024 2
Slide 3: Achieving Europe's decarbonization
Achieving Europe’s decarbonization 1. Methodology & key indicators 5. Energy transition costs 2. Final demand 6. Emissions 3. Renewables & flexibility 7. Ambitions at risk 4. Low Carbon molecules 8. Summary and call to action NOVEMBER 2024 3
Slide 4: Methodology to define Europe's optimized decarbonization pathway
Methodology to define Europe’s optimized decarbonization pathway • Modelling of 15 European countries1 with strongly interconnected energy systems, A European vision... representing more than 85% of Europe’s2 total energy consumption • Considering only low-carbon technologies which have been proven
Slide 5: All levers are needed to achieve Europe's decarbonization objectives
All levers are needed to achieve Europe’s decarbonization objectives FINAL DEMAND ENERGY DEPENDENCY Reduction in final energy demand, which is Reduction in energy imports -30% decoupling from economic growth (GDP: +1.3%/y) -65% (fossil fuels and e-molecules) ELECTRIFICATION FLEXIBILITY Growth in tot
Slide 6: Final demand
Achieving Europe’s decarbonization 1. Methodology & key indicators 5. Energy transition costs 2. Final demand 6. Emissions 3. Renewables & flexibility 7. Ambitions at risk 4. Low Carbon molecules 8. Summary and call to action NOVEMBER 2024 6
Slide 7: Final energy demand reduces significantly, with strong electrification
Final energy demand reduces significantly, with strong electrification complemented by decarbonized gases and heat Optimized 14 Final energy mix | Europe-15 Thousands TWh 12 10 8 6 ELECTRICITY: 48% 4 MOLECULES: 32% 2 HEAT*: 15% 0 FOSSIL: 5% 2021 2030 2035 2040 2045 2050 FOSSIL FUELS LOW-CARBON EMISS
Slide 8: Power demand expected to grow in the medium term
Following important power demand reduction linked to the energy crisis, demand is expected to grow in the medium term Power final energy consumption | Europe-15 TWh OBSERVATION FORECASTS 8 2,800 +2-3% CAGR -3% CAGR 2,600 2,400 2,200 2,800 2,450 65% EV 2,000 2,300 8 1,800 1,600 2021 Climate Energy Cr
Slide 9: Renewables & flexibility
Achieving Europe’s decarbonization 1. Methodology & key indicators 5. Energy transition costs 2. Final demand 6. Emissions 3. Renewables & flexibility 7. Ambitions at risk 4. Low Carbon molecules 8. Summary and call to action NOVEMBER 2024 9
Slide 10: Power generation mix fully decarbonized by 2050
The power generation mix is fully decarbonized by 2050 primarily driven by the rapid growth of renewables, complemented by nuclear and thermal Power Generation Mix & Total Demand TWh/y 2023 2030 2050 41% 2,380 60% 2,960 85% 4,950 Europe 15 Solar and wind generation 28% 446 38% 500 68% 780 x5.5 x6 by
Slide 11: Renewable power deployment to 2030 seems achievable
The needed acceleration in renewable power deployment to 2030 seems achievable considering recent developments Renewable capacity projections | Europe-15 GW +45GW/y 1 1,800 800 1,600 OFFSHORE 1 600 WIND 1,400 1 400 ONSHORE 1,200 1 200 +55 WIND 1,000 1 000 GW/y 800 600 +20 +40 GW/y GW/y 400 SOLAR 200
Slide 12: Power system flexibility capacity must be enhanced
Power system flexibility capacity must be enhanced, in large part through batteries and demand side solutions Total Flexible Capacity Mix | Europe-15 GW 1 000 920 Flex Thermal Power 800 Hydro SUPPLY System X4.5 Batteries (Front-of-the-Meter) Batteries 600 (Behind-the-Meter) Buildings Hybrid Heat Pum
Slide 13: Not developing demand side flexibility would impact system viability and costs
Not developing demand side flexibility levers would have major impact on system viability and costs HYPOTHESIS KEY IMPLICATIONS Scenario where only supply side flexibility Peak Capacity| Europe-15 Compared to the Net Zero Pathway solutions are developed to complement GW, 2050 the growth in renewable
Slide 14: Low Carbon molecules
Achieving Europe’s decarbonization 1. Methodology & key indicators 5. Energy transition costs 2. Final demand 6. Emissions 3. Renewables & flexibility 7. Ambitions at risk 4. Low Carbon molecules 8. Summary and call to action NOVEMBER 2024 14
Slide 15: Methane demand is reduced and decarbonized by 2050
Methane demand is reduced massively and is entirely decarbonized by 2050 Methane demand | Europe-15 Methane demand | France TWh TWh 4,000 4 000 450 3,500 3 500 -45% 400 -40% 350 3,000 3 000 300 2 500 2,500 250 2 000 2,000 200 1 500 1,500 150 1 000 1,000 100 500 50 0 0 2023 2025 2030 2035 2040 2045 2
Slide 16: Low-carbon hydrogen deployment is delayed and reduced
Low-carbon hydrogen deployment is delayed and reduced compared to what was anticipated in the 2023 Net Zero Pathway for Europe. Hydrogen demand | Europe-15 TWh 2 000 2,000 2023 Trajectory 1 500 1,500 NEW USES x7 total demand increase AVIATION vs 2023 73% 1 000 1,000 MARITIME of the hydrogen demand,
Slide 17: Energy transition costs
Achieving Europe’s decarbonization 1. Methodology & key indicators 5. Energy transition costs 2. Final demand 6. Emissions 3. Renewables & flexibility 7. Ambitions at risk 4. Low Carbon molecules 8. Summary and call to action NOVEMBER 2024 17
Slide 18: Investments partially offset by fossil fuel savings
Investments necessary for the decarbonization of Europe are gradually partially offset by savings in fossil fuel Decarbonization Costs & Savings | Europe-15 Investment Cost and net OPEX savings €bn/y 500 400 300 1.8% 1.6% 200 1.0% 100 0 -100 -200 2025-30 2031-40 2041-50 INVESTMENTS Low-Carbon Energy
Slide 19: Power generation and networks account for majority of investments
Power generation and networks account for the majority of investments needed to decarbonize the energy sector Investments in low-carbon energy production and infrastructure by energy carrier | Europe-15 €bn/y 200 160 120 6x 80 Investments in electricity vs gas infrastructure 40 0 2025-30 2031-40 204
Slide 20: Total power system costs per unit of energy remain stable
Despite important investments, total power system costs per unit of energy produced are expected to remain stable Total Power System Cost | Europe-15 Annualized €/MWh, Index 2025 = 100 100 90 80 70 60 50 -10% 40 Estimated average 30 wholesale prices 20 France, 2050 Net Zero Pathway 10 vs average act
Slide 21: Emissions
Achieving Europe’s decarbonization 1. Methodology & key indicators 5. Energy transition costs 2. Final demand 6. Emissions 3. Renewables & flexibility 7. Ambitions at risk 4. Low Carbon molecules 8. Summary and call to action NOVEMBER 2024 21
Slide 22: Emissions reductions must accelerate to achieve Net Zero
Emissions reductions must accelerate across all economic sectors to achieve Europe’s Net Zero target Greenhouse gas emissions | Europe-15 CO2e, Gt / year 1990-2010 2010-2020 2020-2050 1% annual reduction 2% annual reduction 4% annual reduction NET EMISSIONS 5 OTHERS AGRICULTURE 4 BUILDING 2030 targe
Slide 23: Ambitions at risk
Achieving Europe’s decarbonization 1. Methodology & key indicators 5. Energy transition costs 2. Final demand 6. Emissions 3. Renewables & flexibility 7. Ambitions at risk 4. Low Carbon molecules 8. Summary and call to action NOVEMBER 2024 23
Slide 24: The energy transition requires transformation of the entire energy system
The energy transition requires the transformation of the entire energy system Components of Europe’s 2050 net zero energy system FLEXIBILITY Electrons BESS Front-of-the-Meter BESS Behind-the-Meter Pumped Storage Hydro DHC EVs Hydro Heat & INFRASTRUCTURES Gas T&D Charging Elec. Cooling T&D Infrastruc
Slide 25: Components of net zero energy system at different stages of transformation
The components of Europe’s net zero energy system are today at different stages of transformation Transformation EARLY STAGE SCALING UP ACCELERATING MATURING stage • Few large-scale pilots in operation • Several large-scale pilots in operation • Proven growth dynamics Industrial • Business models no
Slide 26: Shifting investments towards solutions at earlier stages
Achieving Europe’s decarbonization objectives implies shifting investments towards portfolios of solutions at earlier stages of transformation OBJECTIVE 2030 OBJECTIVE 2050 Stage of transformation Required investment, 2024-2030 Required investment, 2030-2050 Accelerate Low uncertainty €170bn/y 50% €
Slide 27: Transformation uncertainties could cause Europe to miss targets
These transformation uncertainties imply that Europe could miss its targets if actions are not taken to ensure the timely development of all necessary solutions Net Greenhouse gas emissions | Europe-15 CO2e, Gt / year 5 Realized Forecasts 4 NET ZERO PATHWAY Resulting in 1.5°C warming scenarios 3 -50
Slide 28: Summary and call to action
Achieving Europe’s decarbonization 1. Methodology & key indicators 5. Energy transition costs 2. Final demand 6. Emissions 3. Renewables & flexibility 7. Ambitions at risk 4. Low Carbon molecules 8. Summary and call to action NOVEMBER 2024 28
Slide 29: Summary of key messages
Summary of key messages • Achieving Europe’s decarbonization ambitions remains possible. This requires a constant drive and a highly pragmatic approach, leveraging electrification which must be complemented by decarbonized gases and heat • The energy transition is a transformation of the entire ener
Slide 30: 10 bold measures to achieve Europe's objectives
10 bold measures to achieve Europe’s objectives 1. Introduce a carbon price floor increasing over time TRANSVERSAL 2. Optimize the energy system at European scale 3. Remove regulatory bottlenecks for renewable power deployment and facilitate trans-European green power PPAs / CfDs* through access to