IEA BIOENERGY ExCo65 Overview of Market Development in Asia =Future Energy Demand in Asia= IEA Bioenergy Workshop May 12, 2010 Nara Hotel, Nara, Japan Shigeru KIMURA The Institute of Energy Economics, Japan 1
Primary Energy Demand by Region (World) 8,000 7,000 6,000 5,000 4,000 3,000 2,000 1,000 0 1971???????? Mtoe 1980 AAGR* 80-07 07-35 World 2.0% 1.5% Asia 4.6% 2.5% N.America 1.0% 0.3% *Average annual growth rate L. America 1990 3.6 bil.toe 2000 2007 2010 Asia 2020 7.1 bil. toe N.America OECD Europe Non-OECD Europe 2030 2035 World 2007 11.1 bil. toe? 2035 16.9 bil. toe (1.5-fold increase) Asia 2007 3.6 bil. toe? 2035 7.1 bil. toe (2.0-fold increase) Middle East Africa Oceania By 2035, primary energy demand of Asia achieves twice as much as current level, reflecting high economic growth; 3.6 billion toe(2007)? 7.1 billion toe(2035). Non-OECD will represent 90% of incremental growth of global energy demand toward 2035. 2
Primary Energy Demand (Asia) 8000 6000 4000 2000 0 Mtoe AAGR China India Japan Korea Taiwan Singapore 1980-2007 5.5% 6.0% 1.5% 6.4% 5.2% 6.3% 2007-2035 2.4% 3.7% -0.1% 1.5% 1.2% 1.9% China Japan Taiwan Malaysia Thailand Singapore Other Asia Indonesia Malaysia Philippines Thailand Vietnam Other Asia 6.4% 7.3% 3.4% 7.8% 7.7% 4.1% 3.7% 2.6% 4.5% 3.6% 5.9% 4.2% India Korea Indonesia Philippines Vietnam Hong Kong 14% 12% 50% Japan India China 1971 1980 1990 2000 2007 2020 2030 2035 Based on booming economic growth, the share of China and India together in Asian primary energy demand significantly increases to 66% by 2035. Japan s energy share in Asia, with its slower-paced economic growth and depopulation, will decline from 14% in 2007 to 7% in 2035. 7% 17% 49% Asia 2007 3.6 bil. toe? 2035 7.1 bil. toe (2.0-fold increase) China / India 2007 1.8 bil. toe / 0.4 bil. toe? 2035 3.5 bil. toe / 1.2 bil. toe (1.9-fold inc. / 2.8-fold inc.) 3
Primary Energy Demand by Fuel (Asia) 3,500 3,000 Mtoe???????? AAGR 80-07 07-35 Fossil Fuel 94%? 88% Share: 2007? 2035 2,500 2,000 Total 4.6% 2.5% Coal 5.2% 1.8% Oil 3.1% 2.3% Gas 7.7% 4.1% Coal 52%? 43% Oil 31%? 29% 1,500 1,000 500 0 Natural Gas 11%? 16% Nuclear 3.9%? 6.3% 1971 1980 1990 2000 2007 2020 2030 2035 Coal and Oil will continue to maintain its centrality over Asian energy demand until 2035. The share of natural gas will grow substantially to 16% by 2035, driven mainly by power generation. Fossil fuel dominates 88% of total energy supply and plays a key role by 2035. Other Renewable 1.3%? 4.1% Hydro 2.0%? 1.9% 4
Oil Demand by Region (Asia) 2000 1000 0 Mtoe AAGR China India Japan Korea Taiwan Singapore 1980-2007 5.3% 5.5% -0.1% 4.8% 3.1% 5.2% 2007-2035 3.4% 3.1% -1.2% 0.5% 0.6% 0.8% China Japan Taiwan Malaysia Thailand Singapore Other Asia Indonesia Malaysia Philippines Thailand Vietnam Other Asia 4.0% 4.4% 0.8% 5.2% 7.6% 3.8% 2.0% 1.8% 4.0% 2.6% 3.4% 4.3% India Korea Indonesia Philippines Vietnam Hong Kong 21% 13% 33% Japan India China 1971 1980 1990 2000 2007 2020 2030 2035 4.8 mbd 3.4 mbd Though the continuous improvement of fuel efficiency of automobile and deployment of advanced vehicle is expected, oil demand in China will boost from 7.4 million B/D in 2007 to 19.0 million B/D in 2035, due mainly to its escalating vehicle possession. The share of China and India together in Asian 5 oil demand will grow from 46% to 61% 8% 16% 45% 2007 1.1 billion ton (23 mbd)? 2035 2.0 billion ton (42 mbd) 1.9-fold increase (20 mbd inc.) 2007 2035 China 7.4 mbd 19.0 mbd India 2.9 mbd 7.0 mbd Japan
Number of Vehicles (Asia) 800 600 400 200 0 million vehicles -2 2007~ 2035????? 254 79 95 60% 19% 22% Japan China India Other Asia 30% 9% 22% 200mil. 39% 420mil. Other Asia Japan India China 620mil. 25% 12% 16% 48% 1971 1980 1990 2007 2020 2030 2035 China 2007 42 mil.? 2035 300 mil. (7.0-fold inc.) India 2007 18 mil.? 2035 97 mil. (5.3-fold inc.) Considerable growth of vehicles is expected in China and India. In Japan, it grows only slightly. 6
Primary Energy Supply by Region (World) MTOE 8000 7000 6000 5000 4000 3000 2000 1000 0 1980 2000 2007 2015 2030 N. America OECD Europe Non-OECD Europe Asia Middle East Africa L. America Oceania Source: WEO2009 by IEA 7
Primary Oil Demand by Region (World) Mb/d 120 100 80 60 40 20 0 24% 1980 2000 2008 2015 2030 32% Biofuels International Bunkers Oceania L. America Africa Middle East Asia Non-OECD Europe OECD Europe N. America Source: WEO2009 by IEA 8
Policy Process on Energy Security At At the the 2 nd nd EAS EAS in in 2007 2007 in in Cebu, Cebu, Leaders Leaders resolved Cebu Cebu Declaration on on East East Asian Asian Energy Energy Security. To To show show ERIA s ERIA s value-added to to Leaders Leaders through through policy-oriented recommendations, ERIA ERIA will will contribute to to the the implementation of of the the Declaration. Cebu Declaration on East Asian Energy Security Set individual goals and formulate action plans voluntarily for improving energy efficiency, Encourage collective efforts in intensifying the search for new and renewable energy resources and technologies, including research and development in biofuels Encourage the use of biofuels and work towards a standard on biofuels used in engine and motor vehicles, ERIA s s Contribution through Energy Project Working Group for Analysis on Energy Saving Potential in East Asia Region Working Group for Sustainable Biomass Utilisation Vision in East Asia Working Group for Standardization of Biodiesel Fuel for Vehicles in East Asia 9
ERIA(Economic Research Institute for ASEAN and East Asia) For the sustainable economic growth in East Asia, we have to address not only Trade/Investment liberalization through FTA/EPAs but also wide range of policy issues Economic Integration in East Asia Trade/Investment Facilitation For example, Trade/Investment Promotion Trade facilitation, FTA/EPA strategy, Intellectual Property, Standard Conformity, Narrowing the Development Gap For example, Infrastructure developments, Human Resources, Small and Medium Enterprise, Economic development in CLMV countries, Basic Researches on current and prospective economic situations of the region as a whole and individual countries Sustainable Development For example, Energy, Environment, Poverty reduction Information Security 10
Working Group for Analysis on Energy Saving Potential in East Asia Region Methodology for assessing the energy saving potential Establishment of the working group with 16 members and IEEJ experts BAU Macro data, others APS BAU+Energy saving goals Model Assumptions Population and GDP Car ownership Power generation Energy saving goals and action plans IEEJ/National Energy Outlook Models Energy saving potential = BAU - APS (Econometrics Approach) (CGE) 11
Energy Projection of Primary Energy Supply in East Asia MTOE 10000 9000 8000 7000 6000 5000 4000 3000 2000 1000 0-20% Others Geothermal Hydro Nuclear Gas Oil Coal 1990 2005 BAU APS BAU APS 2020 2030 Source: ERIA EEC WG Report 2010 12
Energy Projection of Final Energy Consumption in East Asia MTOE 6000 5000 4000 3000 2000 1000 0-17% -15% -23% -18% 1990 2005 BAU APS 2020 BAU APS 2030 Industry Transport Others Non-Energy Source: ERIA EEC WG Report 2010 13
Improvement of Fuel Efficiency Fuel Consumption/Number of Vehicles 1990=100 Source: ERIA EEC WG Report 2010 14
Outlook Results Energy Intensity -3% from 2005 350 300 250 200 150 100 50 0 2005 BAU in 2030 APS in 2030-22% from 2005 TPES(Total Primary Energy Supply)/GDP Source: ERIA EEC WG Report 2010 15
Outlook Results Overall Result 10000 9000 8000 7000 6000 5000 4000 3000 2000 1000 0 MTOE,Mt-C } -20% -17% TPES TFEC CO2 } -28% } TPES: Total Primary Energy Supply TFEC: Total Final Energy Consumption CO2: Carbon Dioxide Emissions BAU: Business As Usual case APS: Energy Saving Promotion case 2005 BAU in 2030 APS in 2030 Source: ERIA EEC WG Report 2010 16
Transport Oil Demand in 2030 2% 8% 872 MTOE Oil CNG>L Biofules Source: ERIA EEC WG Report 2010 17
Biofuels Ratio in 2030 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% Total 67 MTOE (8%) Biofuels CNG>L Oil Australia Brunei Cambodia China India Indonesia Japan Korea Lao Malaysia Myanmar NZL Philippines Singapore Thailand Vietnam Source: ERIA EEC WG Report 2010 18
Conclusion (1) Energy demand in Asia will surely increase due to strong economic growth. The growth rate of energy demand will be much higher than the world average. Coal will remain as the dominant energy in future but oil will also be major energy due to progressive motorization in China, India and ASEAN region. Several world energy outlooks indicates same trend mentioned above such as IEEJ and IEA. Accepting the situation mentioned above, the EAS leaders requested ERIA to study EEC and Biofuels on the view of energy security issue. 19
Conclusion (2) Under ERIA, one group was established to conduct EEC study and two groups were established to study biomass including biodiesel standardization. The EEC group has conducted to estimate energy saving potential applying EEC policies (energy saving goals and action plans). According to the study results of the EEC group, the current EEC policies contribute to save energy consumption significantly but are not sufficient to address climate change issues. In transport sector, fuel efficiency surely improves due to the EEC policies but will still continue to consume oil and emit CO 2. 20
Conclusion (3) In transport sector, the use of biofuels is one of the solutions to mitigate CO 2 emissions. According to biofuels policy of EAS countries, 11 countries consider to use biofuels in future and 2 countries use biofuels aggressively. But its share of total EAS region will only be 8% in 2030. Consequently we may need more aggressive biofuel policy paying attention to following issues; Standard specification 2 nd and 3 rd generation biofuels Establishment of trading network Technology development to decrease its production cost etc 21
Thank You 22