Changing Energy Production Structures and CO 2 Emissions in the ASEAN Countries: Decomposition Analysis of Drivers Behi

1. Changing Energy Production Structures and CO2 Emissions in the ASEAN Countries: Decomposition Analysis of Drivers Behind the Changes Authors: Vehmas, Jarmo, Luukkanen, Jyrki, Kaivo-oja, Jari, Snäkin, Juha-Pekka & Jusi, Sari Note: This is extended version of conference paper materials. Venue:International Conference on Energy Security and Climate Change: Issues, Strategies, and Options (ESCC 2008) Sofitel Centara Grand, Bangkok, Thailand. 6-8 August 2008 Presentation by: Dr, Research Director Jari Kaivo-ojaFinland Futures Research CentreTurku School of EconomicsRehtorinpellonkatu 320500 TURKUFinlandEmail jari.kaivo-oja@tse.fiTel. +358-50-50207030

2. 5 Effects analyzed by decomposition analysis • The objective of decomposition analysis in this article is to divide the observed change in carbon dioxide (CO2) emissions from fuel combustion into contributions of different factors of interest identified in the master equation (Equation 1).

3. Effects explained.. • As a result of the complete decomposition analysis presented above, five different factors (effects) are identified in a way that their sum equals to the total change of CO2 emissions from fuel combustion. • The effect of CO2/TPES refers to the contribution of the change in the CO2 intensity of the entire energy system to CO2 emissions. A positive value indicates that decreased CO2 intensity has decreased CO2 emissions. In practice, change in CO2 intensity is a result of several things.

4. Effects explained • The effect of TPES/FEC refers to the efficiency of the energy transformation system, i.e. efficiency in transforming primary energy into different energy carriers such as electricity or heat. This can be influenced by e.g. a switch from fuel use to electricity use, or vice versa, or technological changes in fuel combustion such as a shift from separate heat and electricity production to combined heat and power production (CHP) or vice versa. • The effect of FEC/GDP refers to the energy intensity of the whole economy. This can be influenced by several factors, such as changes in the industrial structure from energy intensive to less energy intensive industrial branches, a shift from industrial production towards services in terms of GDP shares, or technological development inside energy-consuming fields of the economy. This effect is another one which is widely studied with decomposition analysis. In the most common applications a structural effect related to energy intensity changes have been identified and analysed. The structure in this context deals with the shares of FEC and GDP in different economic sectors and industrial branches, for example. • The effect of GDP/POP refers to the amount of economic activity per capita which can be influenced foremost by economic growth. • The effect of POP refers to changes in the amount of population brought about by changing birth and death rates as well as changes n international migration.

5. CO2 emissions in the ASEAN countries, 1971-2005

6. GDP index 1971-2005

7. Development of CO2 emissions from fuel combustion and GDP (PPP)in the ASEAN vcun

8. TPES by energy source in Brunei, 1980-2005

9. TPES by energy source in Indonesia, 1980-2005

10. TPES by energy source in Malaysia, 1980-2005

11. TPES by energy source in Myanmar, 1980-2005

12. TPES by energy source in Philippines, 1980-2005

13. TPES by energy source in Singapore, 1980-2005

14. TPES by energy source in Thailand, 1980-2005

15. TPES by energy source in Vietnam, 1980-2005

16. Decomposition of CO2 emissions from fuel combustion in Indonesia, 1980-2005

17. Decomposition of CO2 emissions from fuel combustion in Malaysia, 1980-2005

18. Decomposition of CO2 emissions from fuel combustion in Myanmar, 1980-2005

19. Decomposition of CO2 emissions from fuel combustion in Philippines, 1980-2005

20. Decomposition of CO2 emissions from fuel combustion in Singapore, 1980-2005

21. Decomposition of CO2 emissions from fuel combustion in Thailand, 1980-2005

22. Decomposition of CO2 emissions from fuel combustion in Vietnam, 1980-2005

23. Decomposition of CO2 emissions from fuel combustion in China, 1980-2005

24. Decomposition of CO2 emissions from fuel combustion in India, 1980-2005

25. Decomposition of CO2 emissions from fuel combustion in U.S.A., 1980-2005

26. Decomposition of CO2 emissions from fuel combustion in Japan, 1980-2005

27. Decomposition of CO2 emissions from fuel combustion in the World, 1980-2005

28. Decomposition of CO2 emissions from fuel combustion in OECD Europe, 1980-2005

29. Short summary • In this paper, we have analysed empirically the reasons which have caused a change in CO2 emissions from fuel combustion in the ASEAN countries using the data from International Energy Agency (IEA). Instead of an ordinary three-factor (activity, intensity and structural effects) decomposition analysis, a new method capable of taking five different factors into account has been used. • The CO2 emissions per capita are considerably low in many ASEAN countries (except Singapore), but the emissions are increasing fast due to the rapid economic growth and increased reliance on fossil fuels. The emission intensities in the countries have been increasing in the industrialization process, but with shift to more service sector oriented production and higher level of GDP per capita, the intensities can decrease. However, the trend of increasing CO2 emissions is difficult to cut due to the increasing population.

30. I thank you for attention! Dr, Research Director Jari Kaivo-ojaFinland Futures Research Centre (FFRC) Turku School of Economics (TSE) Rehtorinpellonkatu 320500 TURKUFinlandEmail jari.kaivo-oja@tse.fiTel. +358-50-50207030