Transcript Updates on the Japanese Energy Sector and the Japan LEAP

Japan Updates,
and draft EAEF Scenarios
Kae Takase (Governance Design Lab.)
Tatsujiro Suzuki (CRIEPI)
EAEF Workshop, Beijing China, May. 12-14, 2004
Outline
 Updates
 Updates of latest statistics
 Feature of new government outlook
 NGO outlook
 EAEF Japan Scenarios
 BAU, National Alternative, and Regional Alternative
 Concept of scenarios
 Results
 Discussion topics
Topics in Energy Policies
 “Energy policy basic law” is now leading Japan
to more nuclear-friendly country.
 Nuclear fuel cycle is at the crossroad (stop
before active test?)
 RPS law is interrupting fine diffusion of
renewable energy
 Turn back in deregulation.
 Compliance of Kyoto Protocol (2008-2012) is
difficult.
Updates (1)
Economy, Energy, and CO2 emission
2.80 1970=1
1970=1
•Economy is recovering
with price decrease.
Price
GDP
TFD
•CO2 emission in 2002
is 10.7% higher than
1990 level.
CO2
Price
TFD
00
20
97
19
94
19
91
19
88
19
85
19
82
19
79
19
76
19
73
19
19
70
1.00
GDP
•Energy consumption
decreased in 2001, but
recovered to 2000 level
in 2002.
CO2
*Price: GDP deflator
*GDP: in real terms
Updates (2)
Energy consumption by sector
200,000
1010kcal
•Industry is still the
largest consuming
sector of energy in
Japan.
Industry
Passenger
Household
Commercial
Freight
Industry
Passenger
Household
Freight
97
20
01
93
89
85
81
77
73
69
19
65
0
Commercial
Updates (2-2)
Energy consumption by sector (1970=1)
4.00
Passenger
Household
Commercial
Freight
Industry
Industry
Household
Passenger
Freight
20
01
97
93
89
85
81
77
73
69
19
65
0.00
Commercial
•Passenger transportation
is the most growing sector
since 1970.
•Household and
commercial sector is also
growing rapidly.
•Freight transportation
and industry sector is not
growing fast. Freight
consumption is steady
recently.
Updates (3)
Energy consumption by source (final energy)
•Oil share is almost 60% of
total final energy
consumption.
Coal
11%
Elec
22%
•Electricity share is 22%.
(higher than U.S., Korea,
China and Europe, but lower
than H.K., Taiwan, Canada.)
Gas
7%
Oil
59%
Coal
Oil
Gas
Elec
Others
*Gas does not include LPG. LPG is included in oil.
Updates (3-2)
Energy consumption by source (final energy)
4.50
Gas
Electricity
•Electricity is growing,
but gas share is growing
more rapidly.
•Coal consumption is at
the same level since 80s’.
Others
Coal
Oil
•Oil consumption is not
growing neither.
Coal
Oil
Gas
Electricity
20
01
97
93
89
85
81
77
73
69
19
65
0.00
Others
*Gas does not include LPG. LPG is included in oil.
New government outlook
 Intermediate outlook will be published on
May 17th.
 Outlook will be calculated up to 2030.
 Economic growth assumption and energy
demand by sector is published in Feb.
Economic Growth
3.0%
2.0%
1.0%
0.0%
2000s
2010s
2020s
-1.0%
-2.0%
-3.0%
G overnm ent H igh
G overnm ent Low
IEEJ Low
N G O structualchange
G overnm ent R eference
IEEJ R eference
N G O R eference
G overnm ent Low
IEEJ Low
N G O G reen grow th
Final Energy Consumption
Government outlook
mil. kl of crude oil equivalent
Peak:2022 (448)
2.0%/year
0.2%/year
Source: METI (2004.2)
Final Energy Consumption
mil. kl of crude oil equivalent
Comparison with other outlook
 Government outlook
460
Gov.
NGO
IEEJ
400
2000
Gov.
2010
IEEJ
2020
2030
NGO
shows highest
growth in energy
consumption.
 IEEJ shows lower
energy consumption
for reference case.
Ratio of Electrification in FD
Government outlook
IEEJ outlook:27%
Final Demand by Sector
mil. kl of crude oil equivalent
Government outlook
Industry
Ind. HH
Com. Pas. Fre.
Industry (exc. feedstock)
Commercial
Passenger
Household
Freight
F.Y.
Comment by Government
 Energy demand will not grow as it did
in 1990s even in high economic growth
case.
Government’s assumption of economic
growth is much higher than that of IEEJ
and NGO.
 Calculated energy demand differs 10%
by different economic assumption.
Electricity demand differs 20%.
Comparison with IEEJ and NGO
 Government assumption of economic
growth is much higher than that of IEEJ
and NGO.
 Calculated energy demand by
government is higher than that of IEEJ
and NGO. IEEJ shows lowest energy
demand.
Alert by NGO
250
Current Balance (trillion yen, 95 price)
Finantial Balance (trillion yen, 95 price)
4
-5
-16
0
-35
250
1985
1995
2000
B AU
2010
代替
2020
2030
-22
-29-27
-23
-25
-35
-54
-65
1985
1995
2000
B AU
2010
2020
代替
2030
 Financial deficit grows, and current balance will change to
a deficit in 2020.
 Unemployment rate will be 12% (4.7% in 2010)
 CO2 Emission will be +5-11% in 2010, and continues to
grow.
 Situation can be better with government’s emphasis on
“Green” industries. (It can increase competitiveness in
international market.)
EAEF Scenarios
1.
Reference
Activity Level, Unit consumption, share of each
energy source: IEEJ
 Renewable energy: ISEP study

2.
National Alternative

3.
Reference + energy conservation (WWF) +
more renewables (ISEP) + elec. generation
composition by sources (WWF)
Regional Alternative
Oil pipeline, Natural Gas pipeline, Electricity
import
 For nuclear and renewables & conservation
cooperation (only affect to the cost)

National Alternative
 Energy conservation
Arranged Tsuchiya study for WWF for
100% installation.
50% in 2010, 100% in 2030
 Renewable energy
WWF “PowerSwitch” scenario, ISEP study
 Less coal and nuclear in electricity
generation
WWF PowerSwitch” scenario
Regional Alternative
1. Oil pipeline
from Eastern Siberia to the Pacific port of Nahodka, starts in
2010
 1 million bpd, at a cost of $5 billion (1/2 China, 1/2 Japan)
 $0.47 per barrel of oil received (30 years lifetime, 5%
discount rate  annual payment 6.5%, 95% capacity factor)

2. Gas pipeline


from Sakhalin Island south to Northern Japan, starts in 2018
Capacity and cost unknown (All of Japanese cost and ½ of
Russian cost paid by Japan) (Price estimate by Russian
engineer exists)
3. Sharing of Oil Refining Capacity


Japan: rental fee revenue, China: smaller cost of refining
It is a matter of China’s decision
Regional Alternative
4. Electricity Interconnections
Sakhalin CNG power to Hokkaido, 2GW in 2020, 4GW (total)
in 2022
 project cost: 9 to 10 billion USD (6 billion USD in transmission
line etc.)
 ½ of total cost paid by Japan (5 cents/kWh)
 Maximum capacity factor will be 65%

5. Cooperation in Nuclear Research and Nuclear
Waste Agreements
6. Cooperation in Energy Efficiency and Renewable
Energy Financing and Technology Development
Final demand by sector
4000
 Final energy demand
3500
3000
2500
2000
1500
1000
500
2002
Industry
2010
H ouseholds
Reg_A lt
N at_A lt
Reference
Reg_A lt
N at_A lt
Reference
B ase
0
2030
C om m ercial
Transportation
grow at 0.3%/year in
reference case.
 Due to energy
conservation, demand
in alternative
scenarios decrease at
0.03%/year.
Primary Energy Requirement
Unit: 10^12kcal
5000
4500
 Ref:0.2%/year
4000
 Alt:-0.7%/year
3500
3000
2500
2000
 Pipeline oil & gas
1500
1000
500
2002
C oal
G as
H ydro&G eotherm al
2010
O il
PP G as
O thers
2030
PP O il
N uclear
Elec Im p
Reg_A lt
N at_A lt
Reference
Reg_A lt
N at_A lt
Reference
B ase
0
introduced in
regional alternative
scenario.
Electricity Generation
1200
 No electricity
1000
800
600
400
200
2002
C oal
2010
O il
NG
Reg_A lt
N at_A lt
Reference
Reg_A lt
B ase
Reference
N at_A lt
0
2030
N uclear
H ydro&G eo
O thers
import (->need
to be fixed)
 More gas and
renewables, less
coal & nuclear in
alternative
scenarios.
* Government has changed the statistics in
2002, but IEEJ and most research institutes
use previous statistics calculated by IEEJ.
Household
650
 Government
10^12kcal
Gov.
IEEJ
ref
national
regional
500
2000
Government
2002
EAEF-ref
EAEF-regional
2010
2020
IEEJ 2030
EAEF-national
outlook shows
higher increase.
Energy Share: Household
Reference case
100%
90%
12%
80%
70%
25%
24%
10%
20%
17%
60%
50%
12%
18%
17%
43%
46%
2000
2010
40%
30%
20%
53%
10%
0%
Electricity
Fuel Oil
Solar
Biomass unspecified
2030
Municipal Gas
LPG
Coal unspecified
 Shares of
electricity and gas
will increase.
 Oil and LPG share
decrease.
Energy Conservation: Household
 LCD TV, LCD PC, double efficiency refrigerator,
diminish stand-by electricity loss
 replace boilers to supply hot water to ones
with latent heat recovery system
 passive solar (heat, hot water)
 efficient gas table
 change incandescent lamp to fluorescent
lamp
 installation of dishwasher
50% in 2020, 100% in 2030
Energy Conservation: Household
700
 2010: 4% of total FD
101.5
conserved.
 2030: 9% of total FD
conserved.
310
 Biggest conservation
600
69
500
67.1
140
400
300
56.8
115.2
136.1
98.6
96.7
200
100
235.1
272.3
2002
2010
0
2030
-100
Electricity
Fuel Oil
Solar
Biomass unspecified
Sav.Oil
Municipal Gas
LPG
Coal unspecified
Sav.Elec
Sav.Gas
in gas (boiler
replacement and
passive solar use in
heating and hot
water supply).
*Change in statistics was very
big in commercial sector.
Commercial
700
 IEEJ outlook
Gov.
10^12kcal
IEEJ
ref
national
regional
400
2000
Government
2002
EAEF-ref
EAEF-regional
2010
2020
IEEJ 2030
EAEF-national
show higher
increase.
Energy Share: Commercial
Reference case
100%
6%
6%
30%
27%
5%
22%
16%
14%
14%
47%
51%
55%
2002
2010
2030
0%
Electricity
Fuel Oil
Metalurgical Coke
Geothermal
Municipal Gas
LPG
Solar
CNG
 Shares of
electricity and gas
will increase.
 Oil and LPG share
decrease.
Energy conservation: Commercial
 Change to amorphous transformer, street lighting






without an electrode, LED traffic lights, LED lights,
LCD PC
higher insulation rate in rental offices
cut off stand-by electricity loss of electricity
appliances
cut off electricity use of vending machine by 54%
replace oil pressure elevators to the ones without
mechanical room
energy management system in buildings
replace boilers to supply hot water to ones with
latent heat recovery system
50% in 2020, 100% in 2030
Energy Conservation: Commercial
 2010: 4% of total
700
600
500
400
300
30.3
145.6
0
29.6
142.7
93.4
76.8
64.9
200
100
27.3
131.2
277.4
225.7
0
-19.6
-100
332.3
-103.2
-200
2002
FD conserved.
 2030: 18% of total
FD conserved.
Electricity
2010
Municipal Gas
2030
Fuel Oil
LPG
Metalurgical Coke
Solar
Geothermal
CNG
Sav.Elec
Sav.Oil
Sav.Gas
Sav.Coal
 Biggest
conservation in
electricity
(replacement to
LED, etc).
Transportation
1100
10^12kcal
Gov.
 Government
IEEJ
ref
national
regional
400
2000
2002
Government
EAEF-ref
EAEF-regional
2010
2020
2030
IEEJ
EAEF-national
assumes
growing energy
consumption in
transportation
sector, but IEEJ
assumes
decrease since
2010.
Energy Share: Transportation
100%
2%
2%
2%
2%
2%
2%
96%
96%
96%
2000
2010
2030
0%
Fuel Oil
LPG
Electricity
 There are
possibilities to
use CNG, and
more electricity,
but these are
not included in
this version.
Energy Conservation:
Transportation
 Tax reform for smaller cars
 Share of double efficiency cars (hybrid,
fuel cell) will be 60% in 2030
50% in 2020, 100% in 2030
Energy Conservation:
Transportation
1000
14.7
18.5
15
800
 2010: 15% of
18.9
13.2 16.7
600
400
875.9
865.4
738.7
200
0
-200
-138.5
-285.5
-400
2002
Fuel Oil
LPG
2010
2030
Electricity
Conservation of Fuel Oil
total FD
conserved.
 2030: 37% of
total FD
conserved.
 Gasoline and
diesel oil use is
conserved.
1800
 IEEJ assumes
Gov.
10^12kcal
IEEJ
ref
national
regional
1500
2000
Government
2002
EAEF-ref
EAEF-regional
2010
2020
IEEJ 2030
EAEF-national
recovery of
economy since
2010, and
energy
consumption
also increase.
Energy Share: Industry
 Coal share
100%
50%
50%
51%
21%
22%
23%
5%
6%
6%
23%
21%
19%
2002
2010
2030
0%
Solid Fuels
Natural Gas
Renewables
Biomass
Electricity
Oil Products
decrease.
 Electricity and
oil share
increase.
Energy Conservation: Industry
 Efficient appliances in all sectors
a control system with an inverter, an
amorphous transformer, Highly efficient
Moter, lights, LED Lights,
regenerative gas-fired burner for industrial
furnaces
 Efficient process in chemical, paper and
pulp, and cement industries.
50% in 2020, 100% in 2030
Energy Conservation: Industry
 Largest
2000
0
1500
867
870
881
357
382
392
93
391
100
356
-74.2
103
323
-148.4
6% saving
13% saving
2010
2030
1000
500
0
-500
2002
Solid Fuels
Oil Products
Natural Gas
Sav.Elec
Renewables
Sav.Oil
Biomass
Sav.Coal
Electricity
Sav.Gas
conservation in
coal
consumption.
 regenerative
gas-fired
burner for
industrial
furnaces
Conclusion
 Japanese government is in a process of
making new outlook to 2030.
Intermediate report on May 17th.
Gov. foresees demand peak will be in 2022
followed by gradual decrease.
 Draft EAEF Japan scenarios
Reference (IEEJ case), National Alternative,
and Regional Alternative
Topics for discussion
 Cost merit of refinery rental
 Cogeneration potential (efficiency factor)
 Future of nuclear and renewables
Major Policy Issues
Energy Policy Basic Law
 Energy Policy Basic Law(2002.6.7 approved)
 “Promote non-fossil fuel energy use for environment”
 Energy Policy Basic Plan (2003.10.17 approved by
Cabinet, reported to the Diet)
 “Stable supply”: Steady promotion of nuclear and
renewable
 “Environment”: Improve the use of non-fossil fuel, such
as nuclear, photovoltaic, wind, and biomass, improve the
use of gas
 “Use of market mechanism” : But government should
be responsible for “stable supply” and “environment.”
 New “long term outlook” is under construction.
 Advisory Committee of Energy will start by the end of 2003.
 Final outlook will be determined by March (or June) in 2004.
Major Policy Issues
RPS Law
10^8kW h
 RPS law (2002.6 approved, 2003.4 enforced)
 Electric power supplier obliged to supply certain
percentage of “new energy”
 Suppliers can supply new energy with their own
capacity, or buy electricity from IPPs, or buy value of
“CO2-free”
 “New energy” includes waste power (dominant
energy in Japanese RPS)
130
120
110
100
90
80 73.2
70
60
2003
122
76.6
80
2004
2005
86.7
92.7
2007
2008
103.3
83.4
2006
2009
2010
Major Policy Issues
Concealment of cracks by TEPCO
 2000.9: former employee of GE reported to METI
the alteration of the internal inspection record
 2002.8: “Nuclear and industrial safety agency”
and TEPCO announced, “13 plant, 29 data
alteration”
 (more alternation revealed)
 2002.9: TEPCO was ordered to stop Fukushima
No.1 plant.
 2003.4: TEPCO stopped all 17 plants (now 7 working,
rest would be restarted by 2004.3)
 2003.4-10 operation rate: 53.8% (30 point less than
last year)
 No blackout in the summertime
Major Policy Issues
Nuclear Fuel Cycle
 No more need for NFC
 No future for FBR/pluthermal, no more scarcity of uranium
 Project cost  electricity price
 Once started: $90-130 billion (1US$=110 yen) 1 cents/kWh
(nuclear)
(Source: Japan
 Stop before active test: $40 billion
Initiative,2003.
11)
 2004.1- Uranium test (contamination starts)
 2005.2- Active test
 2006.7- Commercial operation
 Whole cycle (2003.11.3 The Federation of Electric Power Companies of Japan(?), 72 years
until decommission, mainichi news):
$200 billion 2 cents/kWh(nuclear)
 Problem with used fuel storage for power companies
 If the project continues, 5 ton of plutonium per year will be
produced in Rokkasho
Major Policy Issues
Deregulation
 Retail liberalization
2001.3- :large-scale factories and department
store (30% of demand)
2004- :+middle-scale factories, office building
2005- :+small-scale factories, supermarket
(60% of demand)
 Turn back of market reforms (midterm report for
further reform, 2003.9)
Responsible companies for generation-
transmission-distribution is vital for stable supply,
and nuclear development