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Future Technology Transformations in Steel and Power Industries

Explore the current status, challenges, and policies in the steel and power industries of China, Japan, Korea, and Taiwan. Learn about initiatives to reduce emissions and enhance energy efficiency.

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Future Technology Transformations in Steel and Power Industries

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  1. Introduction to Future Technology Transformations FTT – Part (2) Pim Vercoulenピムバクレン p.vercoulen@student.ru.nl June 3rd, 2018ASSIA officeNagoya University 名古屋大学

  2. Outlinefortoday • Recap of last FTT:Seminar • FTT:Steel • Preliminary results on China, Japan, Korea, and Taiwan • The data that is stillsoughtfor • FTT:Power • Workingwiththevaryingpolicies • Subsidy + demandpolicies • Exogenouscapacityadditions (e.g. governmentenforced) + Regulations • Carbon tax + Feed-in-Tariff

  3. Recap of last week • Methodology of FTT framework • Levelisedcost • Preference Matrix • Change in market share • Preliminary Results of FTT:Steel • Manydata gapsstillexists • WorkingwithFTT:Power • We’veusedsubsidies / taxeson capital investment costs • Regulations on coal power

  4. FTT:Steel – China – Current status

  5. FTT:Steel – China – Challenges • Low scrap availability • Low quality of domestic iron ore andcoal • Overcapacity -> Utilisationrates of 50% werereported! (OECD 2015)

  6. FTT:Steel – China – Policies • NationallyDeterminedContributiontotheParis Accord: • Reduceemissionintensity(GtCO2/GDP) • Thisdoesn’tmean a reduction in absolute emissions • Reach peak emissionbefore 2030 andreduceafterwards • Increaseenergy efficiency (GJ/tcs) • Reduceovercapacity • Closing down small (i.e. inefficient) plantstoincreasetheutilisationrate • Merge small to medium steel companies to large ones

  7. FTT:Steel – Japan – Current status

  8. FTT:Steel – Japan – Challenges • Lack of domesticrawmaterials • Exporttothe US mightbecome a problembecause of steel tariffs • More room forthesecondaryproductionroutes togrow, probablynotenoughtobecomeself-reliantthough

  9. FTT:Steel – Japan – Policies • NDC target of 26% GHG emission reduction by 2030 compared to 2013 • Steel sector specifically addressed: • Efficiency improvement of electricity-consuming facilities • More chemical recycling of waste plastic at steel plants • Introduction of next-generation coke making • Improvement of power generation efficiency process (SCOPE21) • Enhanced energy efficiency and conservation facilities • Introduction of innovative ironmaking process (Ferro Coke) • Introduction of environmentally harmonized steelmaking process (COURSE50) • COURSE50 • Voluntary action taken bythe steel industryto focus on new, low-carbon technologies • GHG emission reduction target of 30% by 2050

  10. FTT:Steel – Korea – Current status

  11. FTT:Steel – Korea – Challenges • Exemptedfrom US steel tariffs

  12. FTT:Steel – Korea – Policies • GHG emission reduction targets: • 30% below BAU by 2020 • 37% below BAU by 2030. • Emission Trading Scheme • Includes the iron and steel industry

  13. FTT:Steel – Taiwan – Current status

  14. FTT:Steel – Taiwan – Challenges • Relies on import of resources • Taiwan is at risk of being affected by US steel tariffs

  15. FTT:Steel – Taiwan – Policies • No NDC, but a unilateral voluntary contribution • “Greenhouse Gas Reduction and Management Act” • Reduce GHG emissions by 50% compared to BAU in 2050

  16. Data needs • Historicalutilisationof technologies is not well reported. Examples: • In KoreaFINEX is used (designated as a SRI+ - BOF route), but no timeline of steel productionbythistechnologycanbe found. • The sameforCOREX (designated as SRI-BOF) in KoreaandChina. • AndHismelt (designated as SRI-BOF) in China • Accurate data on anythingthatcould affect thelevelisedcost of steelmaking: • Regionalspecific investment costs • Operationand maintenance • But most importantly, materialconsumption

  17. FTT:Power – Policy setting examples Now back to policy setting withFTT:Power

  18. FTT:Power – Recap of last week – Baseline Results

  19. FTT:Power – Recap of last week – S1 Results

  20. FTT:Power – S2– Subsidy + Demand • Scope : Japan (No. 35) and China (No. 41) • Goal : Incentivizerenewables (…and cheat a little bit) • Policies • Subsidies on investment costs: • 75% forallsolarand wind technologies (enter: -0,75) • Electricity storage tocapacity ratio (MEES and MEKS): • Japan: 1% in 2018. Let itincreaseby 2% annuallyuntil 50% is reached • China: 30% in 2018. Let itincreaseby 0,25% annually • EvaluateEmissions, Electricity Price, Market shares of CoalandRenewables (solarand wind), and Total InstalledCapacity • Realizethat changes occurduetotechnologicaldiffusionwhich are drivenbythe LCOE

  21. FTT:Power – S2– Subsidy + Demand – Results

  22. FTT:Power – S3– Capacityadditions + Regulations • Scope : Japan (No. 35) and China (No. 41) • Goal : SubstituteCoalforits CCS variant • Policies • Regulations: • Coal: • Japan: 85 GW in 2018 and a 2,5 GW annualdecrease • China: 750 GW in 2018 and a 20 GW annualdecrease • MWKA: • Coal (CCS): • Japan: 5 GW in 2018 and a 3,75 GW annualincrease • China: 40 GW in 2018 and a 30 GW annualincrease • EvaluateEmissions, Electricity Price, Market shares of CoalandRenewables (solarand wind), and Total InstalledCapacity • Realizethat changes occurduetotechnologicaldiffusionwhich are drivenbythe LCOE

  23. FTT:Power – S3– Capacityadditions + Regulations – Results

  24. FTT:Power – S4– Carbon Tax + Feed-in-Tariff • Scope : Japan (No. 35) and China (No. 41) • Goal : Incentivizerenewables • Policies • Carbon tax: • For both China and Japan: 55 €/tC in 2018 andincreaseby 6.5% annually. • Feed-in-Tariff • Solar: From 2018 onwards enter 75 forallsolartechnologies • Wind: From 2018 onwards enter 75 forall wind technologies • EvaluateEmissions, Electricity Price, Market shares of CoalandRenewables (solarand wind), and Total InstalledCapacity • Realizethat changes occurduetotechnologicaldiffusionwhich are drivenbythe LCOE

  25. FTT:Power – S4– Carbon Tax + Feed-in-Tariff – Results

  26. FTT:Power – Overview of results

  27. FTT:Power – Overview of results • S0: Baseline • S1: Regulations on Coal in combinationwithtaxes on technologiesthatmightreplaceit • S2: Subsidies on renewablesandanincrease in storage capacity • S3: Regulations on Coalmitigatedbyexogenouscapacityadditionson Coal + CSS • S4: Carbon taxin combinationwithFeed-in-Tariffs on renewables • Japan • Best scenario mightbe S2 for Japan, whileitdoesn’tworkthat well for China • China • Best scenario mightbe S3 for China, whichalsoworksfor Japan tosomedegree

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