International Workshop on “Towards Low Carbon Cities: Understanding and Analyzing Urban Energy and Carbon”

Nagoya University, Nagoya, Japan17-18 February 2009

Energy and Environmental Implications of Carbon E i i R d ti T tEmission Reduction Targets:

Case of Kathmandu Valley

Ram M. Shrestha and Salony RajbhandariAsian Institute of TechnologyAsian Institute of Technology

ThailandThailand

1

Source: ICIMOD 2007

2

Source: ICIMOD, 2007

Kathmandu Valley• The capital city of Nepal• Area: 899 km2

• Population in 2005: 1.85 million– About 51% of the total national urban population

• Major user of electricity and other modern fuels in the country• Major user of electricity and other modern fuels in the country– 29% of national electricity consumption in 2005– Over 55% of national oil consumption

• High growth of vehicle stock: CAGR during 1995-2005: 12.7% • Growing air quality problem

– PM10: 236 to 606 ppm > WHO standard (70 ppm)pp ( pp )– TSP: above 1000 ppm > WHO standard (150-230 ppm)

3

Objectives and MethodologyObjectives and Methodology

• To analyze energy supply structure and cumulative CO2y gy pp y 2emission level in the base case during 2005-2050

• To analyze the effects of selected carbon reduction t ttargets on: – energy supply- and technology- mix– emissions of local air pollutants– Sectoral contributions to CO2 reductions

------------------M th d lMethodology• A long term energy system model of Kathmandu valley

(based on MARKAL framework) used for the study

4

(based on MARKAL framework) used for the study

Structure of Present Energy UseStructure of Present Energy Use

5

Structure of Total Energy Consumption in K th d V llKathmandu Valley

2005

8%2%15%29% Coal

ElectricityPetroleum Products

46%

Petroleum ProductsRenewablesOther Fossils

46%

TEC: 35.78 PJ

6Oil has the predominant share (46%), followed by renewables

Sectoral Shares in Total Energy Consumption

Agricultural0.11% Commercial

9.81%Transport31.24% Industrial

18.90%

2005 Residential39.93%

TEC: 35.78 PJ

7Combined share of Residential, transport and industrial sectors: about 89%

Residential Sector Energy Structure in 2005

Electricity

Biogas0.07%

Solar0.01%

Fuelwood41.83%

Electricity24%

Kerosene

Animal Dung0 42%

LPG6 55%

Kerosene15.92%

2005

0.42%

Agricultural Residue11.34%

Coal0.14%

6.55%

Total: 14.23 PJ

8Biomass 53%, Electricity 24%, oil 16%, LPG 6.5%

Commercial Sector Energy Structure in 2005

Fuelwood7%

Solar7%

Charcoal7%

LPG6%

0%Electricity

23%

2005 Kerosene57% Total: 4.03 PJ

9Oil 57%, electricity 23%, LPG 6%, biomass 14%

Transport Sector Energy Structure in 2005

Jet Fuel 18 90%

Electricity0.18% LPG

3.60%

CNG0.00%

18.90%

Diesel 40.05%

2005Gasoline37.26%

Total: 10.73 PJ

10Based almost entirely on petroleum products

Industrial Sector Energy Structure in 2005

KeroseneElectricity

Other Petroleums3%

Kerosene1%

Diesel2%

12%Fuelwood

21%

3%

Agricultural ResidueAgricultural Residue15%

Coal

2005Lignite

6%40%

Total: 6.71 PJ

11Coal and lignite 46%; biomass 36%, electricity 12%, oil 6%

Description of Casesesc pt o o Cases

• Base case: no carbon reduction policiesp• Carbon Emission Reduction Cases

– ER10: Cumulative carbon emission reduction target of 10% from the base case emission level

– ER20ER30– ER30

– ER40

12

Base Case Analysis

13

Total Energy Consumption during 2005-2050

Primary Energy Supply

500000

300000

400000Other FossilsRenewables

100000

200000

TJ Petroleum ProductsElectricityCoal

0

100000

2005 2010 2015 2020 2025 2030 2035 2040 2045 2050

Year

- CAGR of TEC: 6%

14

-TEC in 2050 almost 13 times of that in 2005

- Substantial increase in electricity use

Structure of Total Energy Consumption in 2005 vs. 2050

2005

8%15%29%

2%

CoalElectricity

2050

46%

Petroleum ProductsRenewablesOther Fossils

10%15%4%

46%42%

29%

CoalEl t i itElectricityPetroleum ProductsRenewablesOther Fossils

• Share of electricity increases to 42% in 2050

•Petroleum products share

15

preduces to 29% in 2050

Sectoral Shares in Energy ConsumptionAgricultural

Industrial18.90%

Transport31.24%

Commercial9.81%

g0.11%

Agricultural0.15%

Commercial19.29%

Transport21.83%

2005Residential

39 93%

Industrial19.50%35,790 TJ

39.93%

2050Residential

39.23%443,350 TJ

Total energy consumption to increase by 12 times during 2005-2050 (CAGR: 5.6%).C i l t h i ti i f 9% i

16

Commercial sector share in energy consumption increases from 9% in 2005 to 19% in 2050; transport sector share decreases to 21%.

CO2 Emissions from Energy Use during 2005-2050 – Nearly 9-fold increase in CO2 Emissions by 2050 (CAGR: 5.2%)– Total emission in 2005 = 1,499 ktons– Transport , Industrial and Commercial sectors- 3 largest emittersp , g

15000

Sectoral CO2 Emissions

10000

12500

15000

Transport

2 00

5000

7500ktonsp

ResidentialIndustrialCommercial

0

2500

2005 2010 2015 2020 2025 2030 2035 2040 2045 2050

Y

Agricultural

17

Year

PM10 Emissions from Energy Use during 2005-2050 in Base Case

Total PM10 emissions in 2005 = 3.7 ktons

To increase by 5.5 times by 2050 (CAGR of 3.85%)

Sectoral PM10 Emissions

To increase by 5.5 times by 2050 (CAGR of 3.85%)

15

20

25

Transport

5

10ktons Residential

IndustrialCommercialAgricultural

02005 2010 2015 2020 2025 2030 2035 2040 2045 2050

Year

18

PM10 concentration in the valley generally already exceeds the 24-hour average standard value set by NAAQS — A major air quality problem!

Emission of air pollutants in Base CaseEmissions

450500

250300350400450

tons

SO2NOXCOTSP

050

100150200kt TSP

PM2.5HC

02005 2010 2015 2020 2025 2030 2035 2040 2045 2050

Year

Pollutant Average Growth Rate, %

Pollutant Average Growth Rate, %

SO2 5.62 TSP 3.82

NOX 4.57 PM2 5 3.67

19

X 2.5

CO 4.28 HC 5.3

•

CO2 Reduction Case Analysis

20

Energy Mix under CO2 Reduction Targetse gy u de CO2 educt o a gets

Primary Energy Supply Mix under CO2 Limits

4500000

6000000

7500000

Renewables

0

1500000

3000000

4500000TJ

RenewablesOther FossilsCoalPetroleum ProductsElectricity0

BaseCase

ER10 ER20 ER30 ER40

Cases

Electricity

Increasing use of electricity: Electricity use in ER40 case 44 % higher than that in the base case.

Petroleum share: declines to 23% in ER40 case (32% in the base case)

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Petroleum share: declines to 23% in ER40 case (32% in the base case).

CO2 emission under different cases during 2005-2050, ktons

10000 00

12000.00

14000.00

16000.00

Base

4000.00

6000.00

8000.00

10000.00

kton

s ER10ER20ER30ER40

0.00

2000.00

2005 2010 2015 2020 2025 2030 2035 2040 2045 2050

Year

Total Sectoral CO2 Emissions during 2005-2050, ktons

Year

Case Annual Growth • CAGR of CO2 emission: 5.2%Rate of CO2

Base 5.21%ER10 4.73%ER20 4 30%

CAGR of CO2 emission: 5.2% in Base case and 3.8% in ER40

•Transport sector - the largest CO itt f ll d b

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ER20 4.30%ER30 3.95%ER40 3.83%

CO2 emitter, followed by industrial, commercial and residential sectors

Sectoral Contribution in CO2 Reduction from different Emission Reduction Casesdifferent Emission Reduction Cases

Sectoral shares in CO2 reduction under

ER10 ER20 ER30 ER40Sector

Agricultural 0.9% 0.9% 0.7% 0.6%gCommercial 60.4% 52.4% 40.4% 31.9%

Industrial -0.1% 3.3% 8.5% 8.4%

Residential 21.6% 19.6% 15.9% 15.1%

Transport 17.1% 23.7% 34.5% 44.1%Total CO2 reduction, ktons 27073 54189 81304 108378

-At targets up to ER30 commercial sector is the biggest contributor to CO2 reductions;

2323

At targets up to ER30, commercial sector is the biggest contributor to CO2 reductions; -Transport sector contributes most at ER40.-Contributions of the transport and industrial sectors increasing with ERT-Contributions of the residential and commercial sectors decreasing with ERT

Environmental Co-benefits of CO2 Emission R d tiReductions

PM10 Emissions PM2.5 Emissions

100150200250300350400450

ktons

TransportResidentialIndustrialCommercial

406080

100120140160180200

ktons

TransportResidentialIndustrialCommercial

TSP Emissions

050

Base Case ER10 ER20 ER30 ER40

Cases

Agricultural

02040

Base Case ER10 ER20 ER30 ER40

Cases

Agricultural

NOX Emissions

300400500600700800900

ktons

TSP Emissions

TransportResidentialIndustrial 600

80010001200140016001800

ktons

NOX Emissions

TransportResidentialIndustrial

0100200300

Base Case ER10 ER20 ER30 ER40

Cases

CommercialAgricultural 0

200400

BaseCase

ER10 ER20 ER30 ER40

Cases

CommercialAgricultural

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Environmental Co-benefits of CO2 Emission Reductionseduct o s

SO2 Emissions

100

150

200

250

300

350

ktons

Transport

Residential

Industrial

Commercial

0

50

Base Case ER10 ER20 ER30 ER40

Cases

Agricultural

8000

10000

12000

CO Emissions

Transport3000350040004500

HC Emissions

Transport

0

2000

4000

6000ktons

Base Case ER10 ER20 ER30 ER40

Cases

Residential

IndustrialCommercial

Agricultural

0500

1000150020002500

ktons

Base Case ER10 ER20 ER30 ER40

TransportResidential

IndustrialCommercial

Agricultural

25

Cases

Total Discounted Cost under CO2 Emission R d ti T tReduction Targets

CaseMillion US$, @

2005 prices % increase

Base 19,491 -

ER10 19,538 0.24

ER20 19,696 1.05

ER30 20,108 3.17

ER40 21 298 9 27ER40 21,298 9.27

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Conclusion and Remarks

• Total energy consumption in Kathmandu valley would increase by 12 fold during 2005-2050 in the base case.

• There would be a substantial increase in the share of electricity and d i th il hdecrease in the oil share.

• Commercial sector share in energy consumption would increase from 9% in 2005 to 19% in 2050.

• CO2 emission would be increased by nearly a 9 fold by 2050.y y y• Transport sector is the largest CO2 emitter, followed by industrial,

commercial and residential sectors.

• Commercial sector is the biggest contributor to CO2 reduction for up• Commercial sector is the biggest contributor to CO2 reduction for up to ER30, while the transport sector contributes most at ER40.

• Electricity share in total energy consumption increases with ERT (due to hydropower.

• Electricity share in transport would increase for targets above ER10.• Fuel cell and biodiesel in transport would be cost effective under

ER40.• Substantial reduction in local air pollutants would result under ER

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Substantial reduction in local air pollutants would result under ER cases.

• Total discounted cost would increase by 0.24% in ER10 to 9% in ER40.

Thank youThank youEmail: ram@ait ac thEmail: ram@ait.ac.th

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Energy Mix during 2005-2050 in Transport Sector, %

Fuel Share, %

Fuel Type Base Case ER10 ER20 ER30 ER40Biodiesel 0 0 0 0 3.83CNG 0 47 0 47 0 48 0 38 0 20CNG 0.47 0.47 0.48 0.38 0.20Diesel 21.35 21.52 20.82 20.33 16.71Hydrogen 0 0 0 0 2.34Gasohol 0.00 17.23 16.98 14.33 6.97Gasoline 39.30 13.08 10.24 8.59 9.04Jet Fuel 27.68 27.89 28.53 29.74 31.34LPG 11.17 19.77 19.15 14.67 8.38Electricity 0.02 0.02 3.80 11.95 21.17

Gasohol use under all ER cases biodiesel use only under ER40

29

- Gasohol use under all ER cases, biodiesel use only under ER40- Oil share declining; electricity share increasing above ER10- Electricity-- hydro based

Effect of CO2 Reduction on Fuel Mix during 2005-2050 i C i l S t2050 in Commercial Sector

Percentage Share in Fuel use

Fuel Type Base Case ER10 ER20 ER30 ER40Electricity 13.96 18.60 29.95 35.00 37.87LPG 4.66 9.72 3.51 1.16 0.94Kerosene 12.25 10.11 7.10 5.78 5.16

Charcoal 16.46 4.59 1.67 0.43 0.00

Fuel wood 51.75 55.97 56.72 56.09 54.91

Solar 0.91 1.01 1.05 1.09 1.12

30Substitution of petroleum products and charcoal with electricity (hydropower) in ER cases

Major Technologies Needed to Meet CO2 Emission Reduction Targets

Sectors Technologies

AgriculturalEfficient electrical pumps

CommercialEfficient air conditioners, electricity/ renewable based cooking devices, electric and solar water heating devices CFLand solar water heating devices, CFL.

IndustrialElectricity and renewable based process heat and boiler technologies, efficient lighting devices.devices.

ResidentialEfficient air conditioners, electric cooking devices, electric or solar water heating devices, CFL.

Transport Biofuel vehicles, fuel cell vehicles

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