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Energy Situation in Asia and the Pacific: Emerging and Persistent issues
Antonio Della Pelle
UNESCAP, Bangkok 26 November 2014
Out
line
1. Introduction 2. Historical Trends in Asia-Pacific 3. Future Trends and Emerging Issues 4. Conclusion
Contents
Enerdata is a global energy intelligence company
Private independent company incorporated in 1991
Workforce of experienced engineers, economists, statisticians, analysts and IT specialists
Significant R&D activity and wide network of international research and industry and consulting partners
In-house databases and models covering all key energy commodities and carbon markets for up to 185 countries
150 clients in over 100 countries: Oil & Gas Multinationals, Power and Gas Utilities, Energy Intensive Users, OEMs, Car Manufacturers, Governments, International Organisations, Banks, Consultancies …
Energy Situation in Asia and the Pacific: Emerging and Persistent issues - November 2014
More than 250 clients worldwide
In Asia
Antonio Della Pelle – Enerdata Managing Director
Antonio is a chartered chemical engineer working in the oil, gas, coal, electricity, renewables and emissions sectors.
A recognised energy professional with worldwide experience particularly in Refinery, Petrochemical, Power, Gas and LNG, most recently in South East Asia, North Asia and Oceania.
Antonio has advised major Oil & Gas companies about Energy Security, Energy Management, Energy Planning and Emission Reductions.
Left Europe in 2003 to live in Japan first and China after before relocating to Singapore where he has been living since November 2005
Additional qualifications , Antonio has a certificate in Coaching and got the INSEAD Supply Chain Manamagent certificate.
Energy Situation in Asia and the Pacific: Emerging and Persistent issues - November 2014
Out
line
1. Introduction 2. Historical Trends in Asia-Pacific 3. Future Trends and Emerging Issues 4. Conclusion
Contents
Energy Consumption Growth Trends Economic growth in Asia led the growth of energy consumption
-6.00
-4.00
-2.00
0.00
2.00
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8.00
10.00
12.00
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Grow
th in
%
Energy Consumption Growth
Europe United States Asia
Energy Situation in Asia and the Pacific: Emerging and Persistent issues - November 2014
Source : Enerdata Global Energy and CO2 database
Energy Mix of Asia
50%
10%
24%
16%
2013
Coal Gas Oil Others
38%
8% 31%
23%
2000
Coal Gas Oil Others
Others include nuclear and renewables
Energy Situation in Asia and the Pacific: Emerging and Persistent issues - November 2014
Source : Enerdata Global Energy and CO2 database
Renewables in Asia
Renewable energies support schemes in Asia in 2013
Feed-in tariffs (FiTs)
Renewable Obligations (ROs)
FiTs + ROs
Source : Enerdata Power Plant Tracker
0.00
5.00
10.00
15.00
20.00
25.00
30.00
0.00
2.00
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2000200120022003200420052006200720082009201020112012
Shar
e of
Ren
ewab
les
in E
lect
ricity
Elec
tric
ity G
row
th %
Electricity and Renewable Trends
Electricity Consumption Growth Share of Renewables in Electricty Capacity
Energy Situation in Asia and the Pacific: Emerging and Persistent issues - November 2014
Source : Enerdata Global Energy and CO2 database
Trends in 2013 for Selected Asian Countries
-1
0
1
2
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4
5
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8
9
GDP Energy Consumption CO2 emissions
Grow
th in
%
Trends for Key Asian Countries
China India Japan
China: Coal (+3.7%) remains by far the top fuel (75% of Power mix), Renewables and Gas investments India: Coal (+6.7%) major contribution; Gas decrease Japan: Coal and Gas have replaced Nuclear (0 since 2012), zero growth in emissions Investment in Renewables + Nuclear return planned in 2015
Energy Situation in Asia and the Pacific: Emerging and Persistent issues - November 2014
Source : Enerdata Global Energy and CO2 database
Out
line
1. Introduction 2. Historical Trends in Asia-Pacific 3. Future Trends and Emerging Issues 4. Conclusion
Contents
Some Definitions Description of the EnerFuture scenarios
BALANCE EMERGENCE RENAISSANCE
This scenario explores the implications of more stringent climate policies, with more ambitious efforts on energy efficiency, initiatives to phase out fossil fuel subsidies and a real emergence of renewable technologies. Europe goes beyond its -20% targets by 2020, and the OECD and emerging countries meet their Copenhagen objectives. Following this, a new green deal is launched to reduce world emissions by a factor of 2 by 2050.
Balance provides an outlook of the energy system up to 2035 based on current policies and trends. Sustained growth of China and other emerging countries is a powerful driver of global energy demand, but confirmed energy policy commitments in several regions play a key role in controlling the pace of growth. However, non-coordinated policies result in soaring CO2 emissions across the world and energy prices rise.
With strong efforts in the exploitation and production of unconventional oil and gas resources, the world encounters a fossil fuels renaissance with the appearance of new key actors and ultimately new geopolitical configurations changing the energy independence of several countries. For climate efforts, this new paradigm leads to progressively weaker policies.
Energy Situation in Asia and the Pacific: Emerging and Persistent issues - November 2014
Total Energy Consumption in Asia-Pacific Region
Coal will continue to play a major role in Asia-Pacific. In 2035, it will account for 38% of total energy consumption in Asia.
This is in contrast to global figures : oil market share was more than coal in 2013 at world level.
Gas will be the fastest growing fuel: 200% growth by 2035 as compared to 2013
Nuclear and renewable surpass oil in energy consumption share by 2025.
The share of Asia in world total consumption will increase to 48% in 2035 as compared to 40% in 2013
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
50%
0
1000
2000
3000
4000
5000
6000
7000
8000
9000
10000
2010 2011 2012 2013 2014 2015 2020 2025 2030 2035
Mto
e
Total Energy Consumption Forecast for Asia – Balance Scenario
Other(nuclear and renewables) Coal Gas Oil % of World
Energy Situation in Asia and the Pacific: Emerging and Persistent issues - November 2014
Source : Enerdata POLES model; EnerFuture
Effect of Low Oil Price In the long term, Oil Demand from Asian Countries will rise if surplus production and lower oil prices continue
020406080
100120140160
2000 2005 2010 2015 2020 2025 2030 2035
$05/
bbl
Oil Price Forecast
Balance Renaissance
0
50
100
150
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300
350
400
450
500
2015 2020 2025 2030 2035
Mto
e
Increase in Oil Demand (Renaissance – Balance)
India Indonesia South Asia China
Japan South East Asia South Korea
For a 25% decrease in long term oil price, total oil demand in Asia will increase by around 450 mtoe from 2013 levels. China will contribute to 50% of the increase in oil demand, followed by India (14%) and Japan (9%)
Energy Situation in Asia and the Pacific: Emerging and Persistent issues - November 2014
Source : Enerdata POLES model; EnerFuture Source : Enerdata POLES model; EnerFuture
Natural Gas in Power Mix Capacity additions for gas will surpass coal by 2030
0%
10%
20%
30%
40%
50%
60%
70%
80%
-50
0
50
100
150
200
250
300
350
2015-2020 2021-2025 2026-2030 2031-2035
GW
Capacity Additions (5 year period) – Balance Scenario
Coal Gas Oil Fossil Fuel as % of total capacity
As of November 2014, 694 GW of power plant capacity is under- construction/approved in Asia with fossil fuels accounting for a 53% share
Coal power plants installations will exceed those of gas till 2025 after which gas will surpass coal
Net capacity of oil based power plants will decrease for all the time intervals
The share of fossil fuel based capacity will decrease to 54% by 2035 as compared to 73% in 2013 for Asia
Energy Situation in Asia and the Pacific: Emerging and Persistent issues - November 2014
Source : Enerdata POLES model; EnerFuture
Nuclear is set for a fast growth
0
50000
100000
150000
200000
250000
300000
350000
400000
2020 2025 2030 2035
MW
Nuclear Capacity Addition - Balance Scenario
India Japan South Korea South Asia Indonesia South-East Asia China
• Enerdata expects the total increase in electricity capacity of Asia to be 3.2 TW by 2035. Out of this Nuclear will account for 10% increase, which is same as that of increase in hydro or solar power
• China will play a key role in growth of Nuclear in Asia. Out of a total increase of 370 GW of nuclear capacity in Asia by 2035, China will account for 210 GW of nuclear.
Energy Situation in Asia and the Pacific: Emerging and Persistent issues - November 2014
Source : Enerdata POLES model; EnerFuture
By 2040 China will be by far the leading country in nuclear power generation
2040
300 GW
0
150
225
75
Source: Enerdata POLES Model
Energy Situation in Asia and the Pacific: Emerging and Persistent issues - November 2014
Renewable will be 1/3 of the total electricity capacity by 2035
0
200000
400000
600000
800000
1000000
1200000
1400000
1600000
1800000
2000000
2010 2011 2012 2013 2020 2025 2030 2035
MW
Renewable Capacity – Balance Scenario
Hydro Wind Solar fsct Hydro fsct Wind fsct Solar
Wind will become the largest source of renewable energy by 2035. Share of wind power in the total renewable capacity will increase to 37% by 2035 as compared to 17 in 2013.
Around 70 GW of renewable capacity was installed in 2013 with the biggest contribution from Hydro (38GW)
Solar will see the largest growth: from 5% of the total renewable capacity in 2013 to 18% by 2035
Energy Situation in Asia and the Pacific: Emerging and Persistent issues - November 2014
Source : Enerdata POLES model; EnerFuture
Energy Efficiency
-80
-70
-60
-50
-40
-30
-20
-10
0
10
20
30
2015
2016
2017
2018
2019
2020
2021
2022
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2024
2025
2026
2027
2028
2029
2030
2031
2032
2033
2034
2035
toe/
MS$
05
Increase in Energy Intensity of Asia Relative to Balance Scenario
Emergence Renaissance
• In China, energy intensity is more than halved over 2010-2035, reflecting substantial adoption of energy efficiency practices and technologies.
• Higher supply of fossil fuel with relatively lower prices (Renaissance Scenario) will increase the energy intensity of Asia by 10% in 2035. However, if countries agree to cooperate on policies to reach the UN goals of emission reductions (Emergence Scenario), energy intensity will decrease by 35% in 2035.
Energy Situation in Asia and the Pacific: Emerging and Persistent issues - November 2014
Source : Enerdata POLES model; EnerFuture Source : Enerdata POLES model; EnerFuture
0
50
100
150
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2010 2015 2020 2025 2030 2035
Energy Intensity Balance Scenario
China USA EU-27 Non-OECD OECD
CO2 reduction potential for Asia
-30
-25
-20
-15
-10
-5
0
5
2014 2016 2018 2020 2022 2024 2026 2028 2030 2032 2034
Gt C
O2
eq
Decrease in CO2 emissions (Emergence-Balance Scenario)
Asia Europe North America Rest of the World
If Climate Change policies are implemented (Enerdata Emergence Scenario), Asia holds the highest potential for CO2 reduction. China and India together can contribute around 80% of the total possible reduction from Asia
India -16%
China -67%
Rest of Asia -17%
India China Rest of Asia
Energy Situation in Asia and the Pacific: Emerging and Persistent issues - November 2014
Source : Enerdata POLES model; EnerFuture
Energy Prices and Fossil Fuel Subsidies
14%
57%
29%
86%
Others (Incl Food, Fertilizer) Fuel Subsidies Electricity
42% 58%
Others Fuel
• The electricity and fuel subsidies in Indonesia reached 300,000 Trillian Rupiah which is 11% of GDP in 2013
• Total fuel Subsidies is Malaysia were around MYR 28 bn which is around 2.8% of the GDP in 2013
Indonesia Malaysia
Energy Situation in Asia and the Pacific: Emerging and Persistent issues - November 2014
Source : Ministry of Energy and Mineral Resources, Indonesia Source : Ministry of Finance, Malaysia
Electricity prices in Selected Asian Countries
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2005 2006 2007 2008 2009 2010 2011 2012 2013
USc
05/k
Wh
Axis Title
Electricity Prices for Households
Malaysia Indonesia India Philippines Singapore Thailand
• Electricity prices differ by a wide range between different countries in the region due to subsidy policies and price controls
• Singapore and Philippines have higher electricity prices and reflect the supply and demand fundamentals
• Price controls also affect the adoption of energy efficiency policies
2013 Data not available for Thailand Source : Enerdata Global Energy and CO2 database
Rationalization of Energy Prices is top priority of Asian Countries
Country Examples of Recent Measures
Indonesia On 19 November, 2014, Indonesian government announced hike in gasoline and diesel prices by more than 30% which is expected to save US$8bn in 2015
Malaysia In October 2014, price for petrol and diesel were increased by 0.2 MYR to reduce subsidy burden
China In China, government increased the price of gas in September 2014 to bring the price levels to the international market.
India India removed control from diesel price and gas prices in October 2014. Diesel prices are now deregulated and gas prices will be reviewed every six months
Energy Situation in Asia and the Pacific: Emerging and Persistent issues - November 2014
Source : Enerdata Key Energy News
Conclusions
The dynamics and structure of the energy market in Asia is different as compared to other regions like U.S. and Europe
In the light of the emerging trends, Enerdata has identified a number of issues including low oil prices, growth of gas and nuclear, energy efficiency, climate change policies and energy prices that will play a key role on the final energy consumption
Energy policy of various countries will need to have fundamentals right to ensure balance between developing their economy in a sustainable manner and with security of supply
Energy Situation in Asia and the Pacific: Emerging and Persistent issues - November 2014
Thank you for your attention !
www.enerdata.net Contact:
Antonio Della Pelle Managing Director [email protected]
Phone: +65 6225 5367 Mobile: +65 8363 2885 143 Cecil Street, #03-01 GB Building, Singapore 069542
