1. Michael Ochoada SINOCRUZ Senior Researcher
Conference on APEC Green Energy Finance August 2016, Taipei, Chinese Taipei High Renewable and Improved Efficiency Scenarios: Pathways to Achieving APEC Energy Goals
Michael Ochoada SINOCRUZ
Senior Researcher

2. High Renewable Scenario Improved Efficiency Scenario
Presentation Outline
Introduction
High Renewable Scenario
Improved Efficiency Scenario
Impact of Alternative Scenario on CO2 Emissions
Conclusion and Opportunities for Policy Actions

3. 1. Introduction

4. APEC Energy Goals
On 02 September 2014, the APEC Energy Ministers (EMM11) issued a Joint Statement which they agreed to aspire to the goal of “Doubling the Share of Renewables in the APEC Energy Mix, including in power generation by 2030 from 2010 levels.
In 2007, the APEC Leaders agreed on an aspirational goal to reduce the energy intensity of the region by 25% in 2035, compared with 2005 levels. As such target was seen to be achieved early, the APEC Leaders in 2011 set a more ambitious goal of 45% reduction in energy intensity during the same time frame.

5. 2. High Renewables Scenario

6. Policy Summary of Renewables for Power

7. Renewable Energy Share in Final Energy Demand
Source: IEA (2015) and APERC analysis.
The APEC renewable doubling goal is not met in BAU, but would be met in the High renewables scenario.

8. APEC Renewable Capacity Potential in 2013
APEC is endowed with renewables, of which only 31% is utilised．
Solar and biomass potential to be developed in South-East Asia.
Note: this map is for illustrative purposes and is without prejudice to the status of or sovereignty over any territory, Oceania (Australia, New Zealand and PNG), Other Americas (Canada, Chile, Mexico and Peru), Other north-east Asia (Hong Kong, Japan, Korea and Chinese Taipei), South-East Asia (Brunei Darussalam, Indonesia, Malaysia, Philippines, Singapore, Thailand and Viet Nam).
Source: APERC analysis

9. APEC Renewables Supply Cost Curve
Biomass
Source: IEA (2015) and APERC analysis.
Access to technologies, renewable resource and land availability lead to lower LCOEs in China, Mexico and the United States
Hydro, biomass and geothermal have low LCOE mainly due to long lifetime, thus sensitive to discount rate.

10. Renewables Share in Power Generation
Source: IEA (2015) and APERC analysis.
To meet the doubling RE goal, an average of 100 GW of new capacity should be added each year from

11. Renewable Power in the High Renewables Scenario
Major growth of solar in Asia, the United States and Oceania
Note: this map is for illustrative purposes and is without prejudice to the status of or sovereignty over any territory, Oceania (Australia, New Zealand and PNG), Other Americas (Canada, Chile, Mexico and Peru), Other north-east Asia (Hong Kong, Japan, Korea and Chinese Taipei), South-East Asia (Brunei Darussalam, Indonesia, Malaysia, Philippines, Singapore, Thailand and Viet Nam), BAU = Business-as-usual, HR = High Renewables
Source: IEA statistics 2015 and APERC analysis

12. Policy Summary for Biofuels
Economy
Regulation
Blend rate mandate
Blend rate target
Incentives, subsidies and taxation
Bioethanol
Biodiesel
Australia √ √*
E4/E5*
B2*
Brunei Darussalam -
Canada
up to E8.5^
up to B4^ E5 B2
Chile
China
E10^
10 Mt (2020)
2 Mt (2020)
Hong Kong
Indonesia E3
B10
E20 (2025)
B30 (2025)
Japan
0.5 million Loe (2017)
Korea
B5 (2020)
Malaysia B7
Mexico E2
New Zealand
Papua New Guinea
Peru
E7.8 B5
The Philippines
E10
E20 (2020)
B20 (2025)
Russia
Singapore
Chinese Taipei
Thailand
4 billion L/yr
5 billion L/yr
United States
up to E15^
up to B10^
136 billion L/yr (2022)^
Viet Nam -#
E10 (2017)
Note: √ = existing; - = not existing currently; * = applied in New South Wales and Queensland for bioethanol and in New South Wales for biodiesel; ^ = applied at federal level and in some local territories or states; # = biofuels traded with no mandated blend rate; Mt = million metric tonnes; Loe = litres of oil equivalent; L/yr = litres per year.
Sources: APERC analysis and IEA statistics 2015.

13. APEC Biofuels in BAU and the High Renewables Scenario
Biofuel supply growing 2.7%/yr could meet over 5% of transport demand.
Enough bioethanol to meet the growing demand, and surplus of biodiesel.
Sources: APERC analysis and IEA statistics 2015.

14. APEC Biofuels in the High Renewables Scenario
APEC bioethanol supply potential and demand
APEC biodiesel supply potential and demand
Bioethanol surplus in the US could offset shortfalls in South-East Asia and China.
Excessive biodiesel supply, especially in South-East Asia, export opportunity.
Sources: APERC analysis and IEA statistics 2015.

15. 3. Improved Efficiency Scenario

16. Improved Efficiency Scenario
APEC’s target can be met by 2032 under the Improved Efficiency Scenario
APEC Energy Intensity target
Overall results
45% reduction target
2037
2032
13% savings 921 Mtoe
Total savings of 921 Mtoe equivalent to the combined current demand of Russia, Japan and Korea.

17. China and the US account for 64% of the savings
Energy savings in the IES by regional grouping,
China has the largest saving potential: it delivers 43% of total APEC savings. The US follows with 21%
Note: Oceania (Australia, New Zealand and PNG), Other Americas (Canada, Chile, Mexico and Peru), Other north-east Asia (Hong Kong, Japan, Korea and Chinese Taipei), South-East Asia (Brunei Darussalam, Indonesia, Malaysia, Philippines, Singapore, Thailand and Viet Nam).

18. Buildings provides 30% of the savings
Buildings sector energy savings by sub-sector,
13% savings 279 Mtoe
Unlike industry and transport, buildings energy demand does not peak in the IES, although growth is very small at end of the period
Sources: APERC analysis and IEA (2015a

19. Efficiency potential in many appliances
Residential energy savings by end-use,
Space and water heating and lighting have the largest potential in the residential subsector
Note: Space heating includes building improvements as well as appliances.

20. Industry saves 372 Mtoe or 16%
Industry final energy demand in the BAU and IES,
Business as Usual
Improved Efficiency
16%
Strong energy demand GDP growth decoupling in industry, where 79% output growth is fuelled by only 10% energy demand growth
Note: Excludes non-energy use.
Sources: APERC analysis and IEA (2015a)

21. Largest savings potential in other less intensive industry
Energy savings in the IES by sector and by regional grouping,
The majority of growth and savings in the Industry sectors come from the less energy intensive sub-sectors.
Note: The three most energy-intensive sub-sectors in the APEC region are iron and steel, chemical and petrochemicals, and non-metallic minerals

22. Transport provides 29% of the savings
Road transport energy savings,
Transport energy demand peaks in 2025 at Mtoe.

23. 4. Impact of Alternative Scenarios on CO2 Emissions

24. Total CO2 Emissions in APERC Scenarios
APEC energy related emissions can peak by 2020 if both energy efficiency and higher shares of renewables are pursued

25. APEC INDCs
Energy related CO2 emissions
APEC economies need to raise INDC ambitions, as well as energy targets if the global climate goal is to be achieved

26. 5. Conclusion and Opportunities for Policy Actions

27. Conclusion and Opportunities for Policy Action
Realization of the APEC RE Doubling Goal is achievable in the High Renewable Scenario, but necessitates the following strategies and support policy/measures:
Formulation of comprehensive renewable energy policy and APEC-wide renewables development plan including a roadmap on renewable technology development.
Improvement of business environment for renewables development as “doing business” in some APEC economies are still cumbersome.
Providing R&D support for current and next generation technologies.
Strengthening and improving the economy’s electricity system to facilitate greater VRE integration.
Enhancing biofuels trade among APEC member economies.
Accelerating development and standardization of advanced biofuels.
Promoting flex-fuel vehicles.

28. Conclusion and Opportunities for Policy Action
Energy Efficiency
Formulation of a comprehensive policy on energy efficiency to cover all sectors.
Labeling on appliances, as the common approach, should be a mandatory policy rather than information and voluntary based.
Adoption of “Best Available Technology” and best practices in new industrial developments and establish mechanism to support retrofitting.
Promotion and adoption of alternative and more efficient vehicles, and R&D on battery technology.
Climate Change
Although the combined scenario shows energy-related emissions to peak and start to fall, such is still above the level needed to limit global temperature increase to 2°C.
Individual economies should monitor and re-evaluates their INDCs, strengthening commitments to accelerate decarbonization of the energy sector.

29. Thank you for your kind attention