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A Comprehensive Review of Japan ’ s Energy Policy. - Towards Simultaneous Achievement of 3Es -. OCT 2001 ANRE/METI. ▲ 2.5% ▲ 3.7% + 2.0% ▲ 1.8% ▲ 6.0%. Emission Reduction of CO2, CH4 and N2O 0% : CO2 from Energy Origin ▲ 0.5% : Emission Reduction of CH4, N2O etc
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A Comprehensive Review ofJapan’s Energy Policy -Towards Simultaneous Achievement of 3Es- OCT 2001 ANRE/METI
▲ 2.5% ▲ 3.7% + 2.0% ▲ 1.8% ▲ 6.0% Emission Reduction of CO2, CH4 and N2O 0% : CO2 from Energy Origin ▲ 0.5% : Emission Reduction of CH4, N2O etc ▲ 2.0% : Innovative Technologies etc Sinks(Land Use Change and Forestry) HFC, PFC, SF6 Kyoto Mechanism ( Emission Trading, J I, CDM ) Total Page 1 Kyoto Commitment -▲ 6% of GHG emissions below 1990 level - Stabilization of CO2 emissions at 1990 level
Page 2 Long-Term Outlook ‘98 for Final Energy Consumption and CO2 Emissions
Page 3 Substantial Changes since 98 Outlook • Change of Lifestyle - Rapid Increase of Energy Consumption in Residential and Passenger Transport Sector • Deregulation of Energy Industry ・Increased Cost Sensitivity and Conflict among 3Es ・Rapid Growth of Coal Power • Delay of Nuclear Power Development Program ・JCO Accident in Tokai village (Sept 1999) • Stagnant Growth of New and Renewable Energy
Page 4 Indices on Final Energy Consumption by Sector
Page 5 Comprehensive Review of Long-Term Supply and Demand Outlook (1) • Policy Target - - - Simultaneous Achievement of 3Es • Energy Security • Reduction of dependency on imported oil • Environmental Protection • Stabilization of CO2 emissions from energy origin at 1990 level • Economic Efficiency • Stable economic growth and promotion of deregulation to improve economic efficiency
Page 6 Comprehensive Review of Long-Term Supply and Demand Outlook (2) • “BAU” (Business As Usual) Case: • Without any policies to achieve Kyoto Target • “Base” Case: • With energy conservation policies introduced after COP3 • Industry Sector • Keidanren Voluntary Action Program • Residential Commercial Sector • Top Runner Program for 11 types of household electric appliances • Energy efficiency standard for house and buildings • Transport Sector • Top Runner Program for automobiles and light and medium trucks • Enhancing freight efficiency, modal changes from truck to railways • Intelligent Transport Systems
Page 7 Voluntary Action Program of Keidanren ☆ Steel Industry ▲ 10% Energy Consumption below 1990 by 2010 ☆Chemical Industry ▲ 10% Energy Intensity below 1990 by 2010 ☆Paper and Pulp Industry ▲ 10% Energy Intensity below 1990 by 2010
Page 8 Fuel Efficiency ( km/l ) Fuel Efficiency ( km/l ) 16km/l 16km/l 14km/l 14km/l 12km/l 12km/l 10km/l 10km/l Top Runner Program New energy efficiency standard Old energy efficiency standard
Page 9 Targets for Energy Efficiency Target Improvement year of efficiency※ Air conditioner(heating & cooling) Air conditioner(cooling only) Television receivers Video cassette recorders Fluorescent lamp luminaries Copying machines Computers Magnetic disc units Gasoline-fueled passenger vehicles Gasoline-fueled freight vehicles (2.5 tons or below) Diesel powered passenger vehicles Diesel powered freight vehicles (2.5 tons or below) Refrigerators ※ Base year: 1997(automobiles: 1995) 2004/07 63% 2007 14% 2003 16% 2003 59% 2005 17% 2006 30% 2005 83% 2005 78% 2010 23% 2010 13% 2005 15% 2005 7% 2004 30%
Page 10 Mtoe / 10^6 t-C 422 393 400 378 BASE - FEC 347 BAU - FEC 350 321 323 BASE - CO2 307 BAU - CO2 300 287 Policy target 287 250 1985 1990 1995 2000 2005 2010 2015 2020 Comparison of BAU and Base Case • Mtoe: Million tons of oil equivalent FEC: Final energy consumption • 1990 1999 2010 (from '90) 2020 • FEC; Mtoe • BAU case 323 372 422 (+31%) -- • ↓44Mtoe • BASE case 323 372 378 (+17%) 393 • CO2; Mt-C • BAU case 287 313 347 (+21%) -- • ↓40Mt-C • BASE case 287 313 307 (+ 7%) 321 • ↓20Mt-C • Policy target 287 287 (± 0%) • →Need more 20Mt-C reductions in addition to painful reduction of 40Mt-C!
Page 11 Mtoe 400 300 Residential Passenger Commercial 200 Freight Industry 100 0 1985 1990 1995 2000 2005 2010 2015 2020 Final Energy Consumption – Base Case Mtoe 1990 1999 2010(from'90) Residential 44 51 61 (+ 38%) Passenger 44 60 56 (+ 27%) Commercial 42 45 55 (+ 32%)* Freight 30 33 32 (+ 7%) Industry 168 175 173 (+ 3%)* Total 328 365 378 (+ 15%) * Including Non-energy use
Page 12 Mtoe 600 500 400 Renewable Nuclear Hydro.Geot. 300 Nat.Gas Oil Coal 200 100 0 1985 1990 1995 2000 2005 2010 2015 2020 Total Primary Energy Supply – Base Case Mtoe 90 1999 2010(from'90) Renewables 7 7 9 (+ 40%) Nuclear 46 71 86 (+ 90%) Hydro & Geo. 21 20 19 (- 6%) Natural Gas 49 70 76 (+ 54%) Oil 284 285 258 (- 9%) Coal 81 95 126 (+ 56%) Total 486 549 575 (+ 18%)
Page 13 Additional Policies and Measures to achieve Policy Target Need to Reduce Another 20 Mt-C to achieve Kyoto Target 1-Further Promotion of Energy Conservation 2-Further Promotion of New and Renewable Energy 3-Fuel Switching ( mainly in Power Sector )
Page 14 Further Promotion of Energy Conservation Further conservation of 6.46 Mtoe under Policy Case, in addition to 46.26 Mtoe under Base Case. - Major energy conservation policy measures and effects - Mtoe "Base case" "Policy case” Industry sector 18.59 Base+0.37 - Keidanren voluntary plan of action etc. 18.59 +0 - Promotion of efficient industrial furnace - +0.37 Residential & Commercial sector 12.96 Base+4.25 - Expansion of Top Runner Program ard for appliances 5.00 +1.11 - Efficiency standard for house & buildings. 7.96 +0 - Promotion of efficient appliances - +0.83 - Promotion of HEMS; Home energy manag. sys. - +0.83 - Promotion of BEMS; Business energy manag. - +1.48 Transportation sector 14.71 Base+0.92 - Expansion and Acceleration of Top Runner Program 5.00 +0.46 - Promotion of NGVs, Hybrid Vs, FCVs etc. 0.74 +0.46 - Promotion of ITS technology application 8.97 +0 Cross sector measures - Promotion of efficient boiler, laser, light - Base+0.92 Total energy consumption reduction 46.26 Base+6.46
Page 15 Further Introduction of New & Renewable Energy • Further introduction of 9.53Mtoe under Policy Case, in addition to 8.14 Mtoe under Base Case. • Introduction of market expansion measures in electricity sector such as Renewable Portfolio Standard - New and renewable energy policy targets at 2010 - Mtoe 1999 "Base case" "Policy case” Solar energy 0.96 1.24 Base+3.91 (5.15) Photo-voltaic cell generation 0.05 0.57 (1.09) Solar heat use 0.91 0.67 (4.06) Wind power generation 0.03 0.30 Base+0.94 (1.24) Biomass energy 4.28 4.55 Base+0.95 (5.50) Biomass fired power generation 0.05 0.12 (0.31) Biomass fuel use 0.00 0.00 (0.62) Black liquer; Pulp & paper waste 4.23 4.43 (4.57) Waste materials energy 1.10 1.96 Base+3.27 (5.24) Waste fired power generation 1.06 1.92 (5.11) Waste & residue derived fuel use 0.04 0.04 (0.13) Wasted energy recovery 0.04 0.09 Base+0.45 (0.54) Total 6.41 8.14 Base+9.53(17.67)
Page 16 Fuel Switching • 1. Further Promotion of Energy Conservation • 6.46 Mtoe = 6.0 Mt-C • 2. Further Promotion of New and Renewable Energy • 9.53 Mtoe = 9.0 Mt-C • 3. Required Fuel Switching • 20.0 - 6.0 – 9.0 = 5.0 Mt-C • Fuel Switching: • Mainly in Power Sector (From Coal to Natural Gas) • Need to address Cost Differential between Coal and Other Fuels • P&M for Fuel Switching: • - Economic Instrument (Tax, Emissions Trading, Subsidy) • - Regulation • - Voluntary Action etc.
Page 17 TWh Electricity power generation 1200 Renewable Nuclear Hydro. & Geo. 1000 Oil Natural gas Coal 800 600 400 200 0 1990 1999 2010 Base 2010 Policy Power Sector after Fuel Switching for 5.O Mt-C Fuel Mix of Power sector in 2010 assuming certain economic instruments to achieve 5.0 Mtoe reduction (e.g. making generation cost of coal power 0.3 yen/kwh=25$/t-C more expensive than that of natural gas power) 2010 TWh 1990 1999 Base Policy Renewable 0 2 3 12 Nuclear 201 317 419 419 Hydro.& Geo. 90 93 100 99 Oil 211 113 38 53 Natural gas 164 241 234 255 Coal 72 153 235 160 Total 738 918 1029 997 * 10-13 additional units (instead of 16-20)
Page 18 Policy Case: Conclusions(1) 2010 Mtoe 1990 1999 Base Policy Renewable 7 7 9 18 Nuclear 46 71 86 86 Hydro.& Geo. 21 20 19 19 Natural gas 49 70 76 77 Oil 284 285 258 251 Coal 81 95 126 105 Total 486 549 575 557 CO2 emission 287 313 307 287
Page 19 Policy Case: Conclusions(2) 2010 Mtoe 1990 1999 Base Policy Residential 44 51 61 58 Passenger 44 60 56 55 Commercial 42 46 55 53 Freight 30 33 32 32 Industry 168 175 173 171 Total 328 345 378 370
Page 20 Nuclear Moratorium Option • Policy Case: 10-13 Additional Nuclear Power Plants towards 2010 • Moratorium Option: No Additional Nuclear Power plants towards 2010 • Coal power substituting nuclear • Under Base Case, 40 Mt-C CO2 emissions above 1990 level (instead of 20 Mt-C) • Need of another 20 Mt-C of fuel switching • Very painful economic measures (e.g. Carbon tax of 250$/t-C) • Severe economic impact • Gross Output of Industry Sector • ▲ 4.2% below Base Case • Household Consumption • ▲ 3.9% below Base Case • → 0% GDP growth from 2008-2010 (instead of 2% under Base Case and Policy Case) • Nuclear Moratorium Option can not be chosen as a viable option