1. Global Warming and Japan’s Energy Conservation Policy SHIGETOMI Norio Project Coordinator Global Environment Technology Development Dept. NEW ENERGY AND INDUSTRIAL TECHNOLOGY DEVELOPOMENT ORGANIZATION (NEDO)

2. GHG Emissions Trend and Kyoto Target in Japan June 2002: Japan ’ s ratification of the Kyoto Protocol GHG emissions reduction target: 6% below 1990 levels GHG emissions as of 2000: 8 % above 1990 levels Base year (1,233) － 6%(1,159) 1,332 2000 74 Base year 1990 Mt (CO2 equivalent) Fiscal year

3. Japan Source: Ministry of the Environment (2000) ＣＯ ２ ＣＨ 4 HFC SF6 PFC N2O Source: IPCC Third Assessment Report (2001) Global ２２． ９ ％ ７． １ ％ ０． ２ ％ ０． １ ％ ６９． ５％ CO 2 HFC SF6 PFC N2O CH 4 ９２． ９％ ０． ３ ％ ２． ８ ％ ０． ９ ％ １． ４ ％ １． ７ ％ Current Status of Global GHG Emissions

4. Amount of energy-derived CO 2 emissions accounts for 93.4% of total emissions amount in 2000. Industry: 495 MtCO 2 (0.9% increase from 1990) Transportation: 256 MtCO 2 (20.6% increase from 1990) Business/Home: 318 MtCO 2 (21.3% increase from 1990) Fuel conversion: 86 MtCO 2 (11.4% increase from 1990) Industrial process: 53 MtCO 2 (6.1% decrease from 1990) Wastes (plastic and waste oil disposal): 24 MtCO 2 (57.5% increase from 1990) Changes in Japan’s CO 2 Emissions by Sector Emissions (MtCO 2 ) Source: Ministry of the Environment Industry 490MtCO 2 Transportation 212MtCO 2 Business/Home 262MtCO 2 (total) Fuel conversion 77MtCO 2

5. 19951996199719981999200020011994 2002 UNFCCC Kyoto Protocol Japan’s ratification of Kyoto Protocol RPS Law concerning Promotion of the Use of New Energy 1979 ～ Energy Conservation LawRevised Individual policy Global Warming Prevention Initiative Keidanren’s voluntary action plans R&D policy Actions by industry Outline of Global Warming Prevention Revised Climate Change Policy Law Revised Basic policy Revised Global Warming Policy in Japan

6. Source: Ministry of the Environment 1159 1332 1233 199020002010 Reduction of energy-derived CO 2 emissions Further reduction by additional GHG emissions reduction measures Base yearCurrent First commitment Unit: MtCO 2 0 1150 1200 1250 1300 1350 14% 8% 6% Current Status of GHG Emissions in Japan

7. Source: Outline of Global Warming Prevention (March 2002) Note: Decrease/increase from 1990. 0.0 % Energy-derived CO 2 emissions reduction: -Energy conservation, New energy, Fuel conversion, etc. -2.0 % -Development of innovative technologies -Further reduction efforts by citizens -0.5 % Countermeasures that reduce non energy-derived CO 2, CH 4, and N 2 O -3.9 % Removals by land use, the forestry sector and sinks +2.0 % Emissions reduction of alternative CFCs (HFC, PFC, SF6) -1.6 % Utilization of the Kyoto Mechanisms Strategies for the Kyoto Target: 6 % GHG Emissions Reduction

8. Reduction by additional measures: Approx. 74 MtCO 2 Sources: Ministry of the Environment, Outline of Global Warming Prevention (March 2002), etc. Japan’s Measures to Decrease Energy-derived CO 2 Emissions to 1990 Levels 1000 1050 1100 1150 1200 1250 1990: 1,053 MtCO 2 2000: 1,155 MtCO 2 Target in 2010: 1,053 MtCO 2 Emissions by existing measures defined in the former Outline of Global Warming Prevention: Approx. 1,126 MtCO 2 2000 Reductions measures for energy-derived CO 2 emissions Energy-derived CO 2 emissions Additional emissions reduction measures Amount of reduction 1. Energy conservation22 MtCO 2 2. New energy34 MtCO 2 3. Fuel conversion, etc18 MtCO 2 Total74 MtCO 2

9. Source: National Inventory, IPCC Secretariat Energy-derived CO 2 Emissions per GDP in Major Developed Countries

10. CO 2 emissions comparison of Japan/USA/Germany (FY 1998) 9.4 10.8 20.4 0 5 10 15 20 25 Japan GermanyUSA tCO 2 /person Source: National Inventory  Given its low per capita CO 2 emission level, Japan has already achieved the highest level of energy efficiency. Comparison of per capita CO 2 Emissions

11. Cost estimation for target reduction (IPCC Third Assessment Report) 0 200 400 600 800 1000 Japan EU USA Marginal reduction cost (US$ ) 97 1074 20 966 76 410 Approx. 400 Approx. 300 Approx. 200 Note: The arrow indicate the range of various cost estimation results.  The marginal reduction cost is higher in Japan than in the EU and USA. Comparison of CO 2 Emissions Reduction Cost

12. Additional Emissions Reduction Measures: 1. Energy Conservation SectorsMeasuresConservation Industry High performance industrial furnace (in medium and small companies) 400,000 Business/ Home -Expansion of the list of top-runner equipment -Accelerated dissemination of high efficiency equipment -Reduction of standby power -Dissemination of “Home Energy Management System” -Dissemination of “Building Energy Management System” Subtotal 1,200,000 500,000 400,000 900,000 1,600,000 4,600,000 Trans- portation -Accelerated dissemination of energy efficient automobiles that satisfies the top-runner standard -Facilitation of automobile diversification (hybrid, etc.) Subtotal 500,000 1,000,000 Cross- cutting -High performance boilers -High performance laser -High efficient lighting products Subtotal 400,000 100,000 500,000 1,000,000 Total 7,000,000 Unit: kl, crude oil equivalent Source: Outline of Global Warming Prevention (March 2002)

13. Unit: kl, crude oil equivalent 1999Target in 2010 Increase from 1999 to 2010 (Approx.) Photovoltaic53, 0001.18 mil.23-fold Wind power35, 0001.34 mil.38-fold Waste power1.15 mil.5.52 mil.5-fold Biomass54, 000340,0006-fold Solar thermal980, 0004.39 mil.4-fold Unused energy (including cryogenic power) 41, 000580,00014-fold Waste thermal44, 000140,0003-fold Biomass thermal--670,000-- Black liquor, waste material4.57 mil.4.59 mi.1.1-fold Total (Percentage in primary energy supply) 6.93 mil. (1.2%) 19.1 mil. (approx.3%) 3-fold 1. New energy on the supply-side Source: Advisory Committee on Energy and Natural Resources (July 2001) Additional Emissions Reduction Measures: 2. Target of New Energy Utilization -1 (July 2001)

14. 2. Renewable energy Unit: million kl, crude oil equivalent 1999Target in 2010 Increase from 1999 to 2010 (Approx.) Total supply of new energy7192.7-fold Hydropower21201-fold Geothermal111-fold Total supply of renewables (Percentage in primary energy supply) 29 (4.9%) 40 (7%) 1.4-fold Total primary energy supply593602 1999Target in 2010 Increase from 1999 (Approx.) Clean energy automobiles65,0003.48 million53.5-fold Natural gas cogeneration1.51 million kw 4.64 million kw3.1-fold Fuel cells12,000 kw2.20 million kw183-fold 3. New energy on demand-side Source: Advisory Committee on Energy and Natural Resources (July 2001) Additional Emissions Reduction Measures: 2. Target of New Energy Utilization -2 (July 2001)

15. Additional Emissions Reduction Measures: 3. Fuel Conversion, etc. Source: Outline of Global Warming Prevention (March 2002) Supportive activities for facilitation of fuel conversion To provide subsidies to fuel conversion projects such as: -Conversion of coal fired power plant to natural gas power plant -Conversion of energy-intensive facility to natural gas facility Improvement of enabling environment -Establishment of relevant safety standards for natural gas pipelines -Low-interest loans to natural gas development projects in Japan (development wells, connection pipelines, etc.) Emissions reduction target18 MtCO 2

16. Photovoltaic and wind power generation Silicon membranes, fuel cells using chemical compound Fuel cells and hydrogen power generation Solid polymer membranes, production/transportation/storage supply of hydrogen Biomass energy Clean coal technology High performance industrial furnaces, reduction of standby power, automobiles using high efficiency clean energy, etc. NEDO’s Technology Development Activities in New Energy and Energy Conservation

17. Grant projects for full-scale introduction Cooperative projects for development of introduction plans Field test projects for experimental introduction To introduce new technologies to end users experimentally, and to demonstrate the effectiveness of such technologies, in order to establish a basis for full-scale introduction and dissemination Ex: Photovoltaics, wind power generation, biomass power generation, etc. To introduce new technologies to end users experimentally, and to demonstrate the effectiveness of such technologies, in order to establish a basis for full-scale introduction and dissemination Ex: Photovoltaics, wind power generation, biomass power generation, etc. To provide subsidies as a part of project budget for full-scale introduction in order to accelerate the dissemination Ex: Clean energy automobiles, photovoltaics, wind power generation, high performance industrial furnaces, high efficiency hot water supply, cogeneration, etc. To provide subsidies as a part of project budget for full-scale introduction in order to accelerate the dissemination Ex: Clean energy automobiles, photovoltaics, wind power generation, high performance industrial furnaces, high efficiency hot water supply, cogeneration, etc. -To cooperate with local authorities for the purpose of developing technology introduction plans -To seek smooth introduction and dissemination through advisory activities at plants -To cooperate with local authorities for the purpose of developing technology introduction plans -To seek smooth introduction and dissemination through advisory activities at plants NEDO’s Supportive Activities for Dissemination of New Energy and Energy Conservation Technology

18. -Large-scale wind power plant in Tomakomai, Hokkaido -Duration: FY 1999 to 2000 -NEDO grant: 1/3 of total project budget -Capacity: 30,600kw (1,650 kw x 14 units, 1,500 kw x 5 units) Example of New Energy Utilization: Wind Power Generation

19. -Photovoltaic field test project (World Trade Center in Tokyo, Japan) -Duration: FY 2000 -NEDO grant: ½ of total project budget -Capacity: 80 kw Example of New Energy Utilization: Photovoltaics

20. Investment and energy conservation (heating furnaces) NEDO grant: 1/3 of total project budget Industrial furnaces 40% Industrial furnace energy consumption share of total industrial energy consumption Energy conservation rate of different furnaces 0 10 20 30 40 50 60 70 80 90 100 Heating furnace Ladle Heat- treating furnace Fusing furnace Gas- treatment furnace Energy conservation rate (%) Others Example of Energy Conservation Technology Introduction: High Performance Industrial Furnaces

21. Coal bed CH 4 4 CO 2 CH 4 CO 2 CO2 fixation Substitution Contribution to IPCC Special Report Ocean sequestration From 2002 (KANSO, J-COAL) Sequestration in a coal bed From 2000 (RITE) Nagaoka-shi, Niigata Prefecture From 1997 (NEDO, RITE) Joint project by Japan, US, Canada and Norway Sequestration in an aquifer CO 2 Sequestration Projects in Japan

22. Purpose: Implementation of model projects that transfer and disseminate effective energy conservation and new energy technologies in Japan Budget in FY2002: Total : JPY 20 billion Energy conservation model projects (including fundamental research projects) JPY 14 billion Coal model projects JPY 2 billion International cooperative projects for photovoltaic demonstration JPY 1 billion International joint research projects JPY 3 billion NEDO’s International Cooperation Program

23. NEDO’s Model Project -1 Purpose: To introduce Japan ’ s energy conservation technology to developing countries. Budget (FY 2002): JPY 14 billion Projects: CountryCompletedOn-going China Indonesia Thailand Vietnam Malaysia Myanmar India Kazakhstan 16 3 1 111221111221 Total238

24. On-going Fertilizer 1 Paper 1 Cement 11 Power Generation 11 Oil Refining 11 CountryChinaIndonesiaThailandVietnamMalaysiaIndiaMyanmarKazakhstan Completed Steel 91 Paper 11 Cement 111 Power generation 21 Oil Refining 1 Chemical 2 Wastes 11 NEDO’s Model Project -2 On-going projects and completed projects by sector

25. FY1998-FY2001 South America 6 Middle East 12 Africa 4Other Asian countries (Mongol) 1 ASEAN 36 China 34 CIS 30 Russia 29 Eastern Europe 19 South East Asia 12 183 Pj. （ 38 countries) June 2002: NEDO’s first obtaining of CO 2 credit utilizing the Kyoto mechanism resulted from a project in Kazakhstan Feasibility study for the purpose of exploring JI/CDM projects that introduce Japanese energy conservation and fuel conversion technologies: 183 projects have been carried out in 38 countries by 2001. Fundamental Research Project for the Promotion of JI/CDM

26. CTI Workshop in Japan 1998199920002001Total China 1 / 12 / 1 3 / 011 Indonesia 1 / 2 2 / 112 Malaysia 1 / 22 / 1-- 6 Philippine 1 / 2 1 / 111 Thailand 1 / 2 12 Vietnam -- 2 / 1 6 Total 5 / 9 14 7 / 8 15 7 / 8 15 9 / 5 14 28 / 30 58 -Four workshops have been held in Japan since 1998 -Workshop theme: Introduction of laws and policies relating to global warming prevention and energy conservation technologies (including plant visits) -Total number of participants by 2001: 58 Government/Industry

27. CTI Workshop Overseas CountryPurposesResults 2001China Thailand Malaysia -Target: Participants in CTI workshops in Japan. -To research the results of CTI workshops in Japan (What activities have been done by workshop participants, and what kinds of results have been achieved so far in each country). -Information exchange for future activities. -Participants have been implementing recommendation activities in each country. -Importance of workshop as an effective way of capacity building is recognized. 2002Indonesia Vietnam 2003Philippine

28. “CTI/Industry Joint Seminar on Technology Diffusion” Series ( Sep 2002 ) BRASTISLAVA ( July 1999 ) WARSAW ( May 2000 ) MADRID ( May 1999 ) SAN SALVADOR ( Mar 2000 ) VICTORIA FALLS ( Mar 1999 ) BEIJING ( May 1998 ) CEBU ( Jan 2000 )

29.  Short-term target: Development, introduction, and dissemination of energy conservation and new energy technologies will be pursued in Japan to achieve the Kyoto target.  Mid- to long-term target: Development of innovative technologies such as CO 2 sequestration technology will be carried out.  Global activities, in which the US and developing countries participate, are important. To achieve desirable and balanced 3E (energy saving, environmental protection, economic development), in order to develop a sustainable economic society with environmental consideration. Summary

30. Technology Needs in China for GHG Emissions Reduction -1 GHGs Mitigation OptionsCTIPNSSALGAS Energy supply Conventional energy Thermal power generation New installation, large-scale unit/Replacement and renovation, medium and low pressure unit/Comprehensive renovation of existing large-scale unit/Increase of cogeneration unit ○ PFBC power generation ○ CFBC ○○ Natural gas combined cycle power generation ○ IGCC ○ Coal-fired super-critical power generation ○ Hydro-power generation – New increase in power generation ○ Nuclear power – New increase in power generation ○ CBM power generation ○ Non-conventional energy Grid-connected wind electric power ○ Wind farm power generation ○ Renewable energy – New increase in power generation ○ Biomass gasification power generation and/or heating ○ Urban waste incineration for cogeneration ○ PretreatmentCoal washing, Briquette, Coal water slurry, Coal gasification ○

31. Sources: -Methods for Climate Change Technology Transfer Needs Assessments and Implementing Activities, Developing and Transition Country Approaches and Experiences, Climate Technology Initiative, March 2002. -The Study on the Methodologies and its Application of Clean Development Mechanism in China (March 2002), National Strategy Studies Program (NSS) -People’s Republic of China, Asia Least-Cost Greenhouse Gas Abatement Strategy (ALGAS, October 1998) Technology Needs in China for GHG Emissions Reduction -2 GHGs Mitigation OptionsCTIPNSSALGAS Energy end-use MotorHigh efficiency electric motors ○ Efficiency motor dissemination and application/Speed adjustable motor installed in fan, pump and compressor/Other speed adjustable motor/Set up motor repair center ○ Industrial boilerEfficiency improvements in coal-fired industrial boilers ○ Fuel pretreatment/Renovation on boiler combustion system/Efficient boiler application/Automatic control of boiler ○ TransportationOptions for highway, railway and waterway ○ ResidentialDevelop town gas/Spread and apply green refrigerator/Briquette/Solar heater/Biogas/Biomass gasification ○ Town and village enterprise Coke oven renovation/Brick and tile kiln renovation/Cement kiln renovation ○ Iron and steel sector Pulverized coal injection of blast furnace/Eliminate OH furnace/Eliminate smelting iron for steel making/New build plant-own power generation station/Set up 6 coke dry quenching devices/TRT installed in blast furnace ○ Textile sectorDevelop cogeneration/Replace boiler/Air conditioner system renovation ○

32. Technology Needs in India for GHG Emissions Reduction GHGs mitigation optionsCTIPALGAS Energy supply Conventional energyClean coal Cogeneration, Combined cycle, ISTIG, IGCC ○ Energy efficiency ○ Rural electrification ○ Non-conventional energy Renewables Small hydro, Wind farm, Decentralized PV ○ Biomass technology ○○ Energy end-use Industrial sectorCross cutting options Diesel cogeneration, Heat pumps, High efficiency motors, Waste heat recovery ○ Energy efficiency ○ Transport sectorCNG car ○ CNG bus ○ Mass rapid transport system ○ Residential sectorCFL (compact fluorescent light) ○ LPG stove ○ Solar cooker ○ Waste managementSolid waste management ○ Sources: Cooperative Technology Implementation Plan (CTIP) for India, March 2002 India, Asia Least-Cost Greenhouse Gas Abatement Strategy (ALGAS, October 1998)

33. GHGs mitigation optionsNSSALGAS Energy supply Conventional energyFuel switching for power generation: 52% coal, 44% natural gas  22% coal, 73% gas  8% coal, 45% gas, 45% nuclear  8% coal, 45% gas, 45% nuclear  3% coal, 10% gas, 80% nuclear) ○ Non-conventional energyBiomass, Biogas ○ Energy end-use Industrial sectorCogeneration option ○ Increase in oil boiler efficiency ○ Application of efficiency motors ○ Production process improvement in non-metallic and paper industries ○ Boiler feedwater system retrofit, Stream pressure reduction, Steam piping insulation, Blow down system retrofit ○ Steam trap retrofit, Boiler retrofit ○ Economizer for boiler, Steam leakage reduction, Condensate tank retrofit ○ Chiller system retrofit ○ Combustion efficiency improvement ○ Residential sectorLighting program of demand side management Air conditioning program of demand side management Refrigerator program of demand side management ○○○○○○ Commercial sectorLighting program of demand side management Cooling program of demand side management ○○○○ Transport sectorIncrease fuel economy in automobiles ○ Technology Needs in Thailand for GHG Emissions Reduction Sources: National CDM Strategy Study for The Kingdom of Thailand, National Strategy Studies Program (NSS) Thailand, Asia Least-Cost Greenhouse Gas Abatement Strategy (ALGAS, October 1998)

34. Technology Needs in Indonesia for GHG Emissions Reduction GHGs mitigation optionsNSSALGAS Energy supply Conventional energy Hydro power, Mini hydro power Gas combined cycle Utilization of flared gas Gas turbine IGCC power plant Nuclear power plant ○○○○○○○○ ○○○○○○ Non-conventional energy Cogeneration HT biomass steam Geothermal Solar thermal Solar photo voltaic power plant Low temperature cogeneration ○○○○○○○○ ○○ ○○ Energy end-use Industrial sectorUse of variable speed motor Boiler improvement in palm oil plant Flue gas aided algae cultivation Combustion-air preheat ○○○○ ○○○○ Transport sectorEthanol vehicles, Compressed natural gas vehicles, Electric cars, Fuel cell vehicles ○ Residential sectorSubstitution of incandescent lamp with CFL (compact fluorescent light) Solar water heater ○ ○ Pulp & paper sectorWaste incineration, Fuel switch ○ Textile sectorCogeneration & heating system reconstruction ○ Waste management Improvement of waste management in starch factory ○ Sources: National CDM Strategy Study for The Kingdom of Thailand, National Strategy Studies Program (NSS) Thailand, Asia Least-Cost Greenhouse Gas Abatement Strategy (ALGAS, October 1998)

35. GHGs mitigation optionsCTPALGAS Energy supply Conventional energyPhotovoltaics for rural development ○ Wind energy for rural development ○ System loss reduction ○ Heat rate improvement ○ Natural gas ○ Non-conventional energy Wind, Solar, Biomass ○ Energy end-use Industrial sectorEfficient industrial motors ○ Energy efficient industrial boiler ○○ Residential sectorEfficient transportation system ○ Energy efficient appliances and equipment ○ Use of CFL (compact fluorescent lamp) ○ Efficient air conditioning system ○ Efficient refrigerators ○ Technology Needs in Philippines for GHG Emissions Reduction Sources: -Draft Framework for Climate Change Technology Cooperation in the Philippines (August 1999), Technology Cooperation Agreement Pilot Project (TCAPP). The program in the Philippines was initiated under the TCAPP, and continued under the Cooperative Technology Partnership (CTP). -Philippines, Asia Least-Cost Greenhouse Gas Abatement Strategy (ALGAS, October 1998)

36. GHGs mitigation optionsALGAS Energy supply Conventional energy Fuel switching ○ Non-conventional energy Wind power construction ○ Energy end- use Industrial sectorHighly efficient electric motors ○ Residential sectorImprovement of efficiency cooking CFL (compact fluorescent light) Highly efficient air conditioning Highly efficient refrigerator ○ Technology Needs in Vietnam for GHG Emissions Reduction Source: Vietnam, Asia Least-Cost Greenhouse Gas Abatement Strategy (ALGAS, October 1998)

37. Contact Information: Global Environment Technology Development Department NEDO http://www. nedo.go.jp/get/index.html kankyo@nedo.go.jp SHIGETOMI Norio Email: shigetominro@nedo.go.jp Tel: +81 3 3987-9368