2-1. Energy and Economic Competitiveness

Transcription

1 APERC Workshop at EWG52 Moscow, Russia, 18 October, Energy and Economic Competitiveness James Kendell Vice President, APERC

2 Energy price for industry: Fossil fuels to price changes for natural gas were greater than oil and coal. 2, 1,8 1,6 1,4 (US /kwh) (USD/toe) Tax Ex-tax price Ex-tax price Light fuel oil (US /kwh) (USD/toe) 1, 9 8 Tax Ex-tax price Ex-tax price 934 Natural gas 916 1,2 1, USA CDA MEX JPN NZ INA RUS GBR FRA DEU ITA USA CDA JPN ROK NZ MAS RUS GBR FRA DEU (US /kwh) (USD/toe) 5 8 Tax Ex-tax price Ex-tax price Steam coal Coal (US /kw (USD/toe) Coking coal Tax Ex-tax price Ex-tax price Source: IEA Energy Prices and Taxes, official statistics USA JPN INA THA RUS GBR IND USA JPN RUS IND 2

3 Energy price for industry: Electricity Prices of electricity for industrial use are influenced by the power generation mix, fuel prices, tariff structures, taxes/levies and subsidies. In APEC, with a high share of coal consumption in the power generation sector, the rise in the electricity price was suppressed. (US /kwh) 35 Electricity price in PNG JPN RP SIN HKC AUS PRC MEX MAS CHL ROK NZ CT THA BD CDA INA PE USA VN RUS ITA DEU GBR FRA IND Source: IEA Energy Prices and Taxes, official statistics, and power company reports etc. 3

4 Energy intensity of manufacturing in APEC With the energy efficiency improvements and structural change, energy consumption per unit of manufacturing production in APEC has steady decreased. However, APEC is still worse than EU. There is large energy saving potential in emerging economies. Energy intensity of manufacturing, Energy intensity of manufacturing, toe/million USD RUS PRC THA ROK USA JPN EU toe/million USD USA MEX RUS JPN ROK PRC CT INA MAS THA AUS APEC EU Other Gas Oil Coal Electricity Source: IEA Energy Balance, World Bank Development Indicators, National Development Council (Chinese Taipei) Statistical Data Book

5 Energy cost of manufacturing in APEC (1) % APEC EU Electricity Petroleum and coal products Natural gas Coal Note: Manufacturing excludes the petroleum and coal products industry. Source: Calculated from Global Trade Analysis Project (GTAP) data 5

6 Energy cost of manufacturing in APEC (2) Cost Structure of major industries in APEC (211) 1% 9% 8% Energy Transport 7% 6% 5% Tertiary industry Secondary industry Intermediate input 4% 3% 2% 1% % Food and textile Paper and publishing chemical Non-metallic mineral Iron and steel Non-ferrous metal Automobile Electric and electronics, etc. Primary industry Capital Labor Gross value added Source: Calculated from Global Trade Analysis Project (GTAP) data 6

7 Competitiveness of APEC manufacturing Indicators of Competitiveness Export value Global export share Relative Trade Balance(RTB) (Export - Import)/(Export + Import). One of the indicators of exports competitiveness and the value is between -1~+1. As the value is the higher, the exports competitiveness is stronger. Revealed Comparative Advantage(RCA) The share of exports of a certain sector in total exports in an economy, relative to the share of this sector in overall world exports. One of the indicators to show the relative advantage of a sector on export in an economy. Source: APERC Example: Competitiveness indicators of APEC manufacturing RTB Billion USD Export value Relative Trade Balance (RTB) PRC JPN ROK RUS USA CT CDA MEX SIN VN Other APEC JPN PRC ROK APEC 2. CT SIN MAS VN INA THA RP 1% 9% 8% 7% 6% 5% 4% 3% 2% 1% % RCA Global export share Non APEC Other APEC VN Revealed Comparative Advantage (RCA) THA 7 JPN ROK SIN MEX CDA CT USA RUS ROK JPN PRC CT PRC APEC VN MAS INA SIN RP

8 Industrial competitiveness and energy Regression analysis was used to assess the effect of three variables on the RTB and RCA of energy-intensive industries. Electricity price for industry--particularly the relative level of electricity price--has a significant impact on the competitiveness of energyintensive industries. The relationship between energy efficiency and industrial competitiveness was not significant in major APEC economies. The relationship between the direct energy cost share and industrial competitiveness was also not significant in each economy during 1997 to

9 Impacts of energy on macroeconomy (1): Cases Global Trade Analysis Project model cases Case 1: Lower energy prices Fossil fuel prices 4% to 5% lower than 211. Case 2: Low carbon power generation Worldwide shift from coal-fired power generation, to advanced fossil fuel generation, nuclear and renewables Case 3: High energy efficiency Significant improvement of energy efficiency in the major energy-intensive industries in APEC, due to the enhanced investment in energy conservation. 9

10 Impacts of energy on macroeconomy (2): Results A drop in energy import prices helps increase GDP in economies that import energy. However, the GDP of economies that produce and export energy suffers a negative effect. Energy price declines and reduced energy costs increase competitiveness in manufacturing by lowering the price of products. A decline in energy costs might help all economies. By shifting labor and capital from energy industries to other industries, competitiveness in manufacturing may increase in economies that produce and export energy. Introducing low-carbon technology has different impacts on electricity prices, depending on the economic performance of the technologies and power generation mix. Introduction of low-carbon power generation and penetration of high energy efficiency technology will help reduce the demand for fossil fuels and lower the price of fossil fuels. 1

11 Policy implications of this study Promoting the reduction of CO2 emissions requires: Reducing the cost of renewable energy and constructing energy supply systems that allow introduction of large quantities of renewables. Use of nuclear power generation where possible. Highly efficient use of fossil energy. Reforming the international LNG market to make natural gas easily accessible. 11

12 Thank you for your kind attention