East Asia Energy Futures Project Summary
By EAEF Collaborators
December 7, 2001
TABLE OF CONTENTS
East Asia Energy Futures Project Summary………………….. 2
1. EAEF Project Objectives.. 2
1.1. Alternative Energy Scenarios 2
2. Project Activities (Phases I to IV) 3
2.1. First Phase (1996-2000, Initial Data Collection) 3
2.2. EAEF Second Phase (Jan. 2000-Feb.2001, Regional Network Development) 4
2.3. EAEF Third Phase (February 2001 ? mid-2002, National Scenarios Development) 5
2.4. EAEF Fourth Phase (Proposed dates, 2002 to 2003, Regional Scenario Integration) 5
3. Summary of the EAEF Framework Meeting, February 2001 6
3.1. Methodology- Common Methods Energy Paths/Scenarios Development 6
3.2. National Energy Scenarios ? Summary of National Energy Interests and Priorities. 8
4. Elaboration of Potential Research Directions 17
4.1. Common Research Framework and Directions for Alternative Energy Scenarios 17
4.2. Other Issues Discussed at the Meeting… 19
4.2.1. Scenario Development ? Questions of Feasibility 19
4.2.2. Measurable Outcomes 19
4.2.3. Target audiences 19
5. Next Project Activities… 20
5.1. Graduate students LEAP Email Working Group (June, 2001 ? End of the EAEF project)… 20
5.2. National Energy Paths Meeting and LEAP third workshop (October or November, 2001) 20
5.3. Regional Scenario Integration and Regional Energy Paths Meeting (April or May, 2002) 21
5.4. The Final Meeting (early 2003) 21
The Nautilus East Asia Energy Futures (EAEF) project has started its third phase of activities, In this phase, project participants, in partnership with the Nautilus Institute, are developing national alternative energy scenarios. The third phase of this project commenced earlier this year with a meeting of participants held in February at Nautilus Institute offices in Berkeley. This meeting was successful in elaborating both the common contextual framework and research methodologies to be used in developing energy scenarios. This report summarizes the content of the presentations and discussions carried out during the framework meeting, and provides a general overview of the EAEF project ? including its objectives, past research activities (Phases one and two), and proposed future activities.
The EAEF project has three main objectives:
1) to develop a set of alternative future energy scenarios for each country in the Northeast Asian region individually as well as for the region as a whole;
2) to develop and assemble accurate and comprehensive national energy data sets that can be shared with other researchers; and
3) to establish clear and open means of communication between regional energy researchers, Nautilus staff, and others, in order to work collaboratively on national and regional energy scenarios analysis.
The alternative energy scenarios under development in the EAEF project will be more than just future energy projections, or mere conceptual outcomes of what we would like to the future to be. Rather, the scenarios will lay out sustainable, and feasible energy pathways that are supported by actual and realistic energy data for each country, and are geared toward improving energy security, in the broad sense, to the greatest degree possible. The scenarios will be compiled and evaluated in a detailed manner using a common but flexible energy end-use-based energy system modeling software tool. As a result, unlike simple projections of future energy use, the individual assumptions in these scenarios can be examined in detail for reasonableness, and detailed quantitative results can be and used to track and measure the energy, economic, and environmental differences between different energy scenarios. Because the scenarios are quantitatively supported by actual energy data, it is also possible to consider what happens to regional energy security when each country orients their energy policy to so as to satisfy national energy priorities and interests.
An important element of the EAEF project is the use of common analytical methods for developing and quantifying the feasibility of alternative scenarios in each of the collaborating countries. Quantitative energy scenario development in the EAEF project is carried out using an energy systems modeling software tool called LEAP (Long-range Energy Alternatives Planning System). The EAEF scenarios development process in each country is using LEAP to organize, quantify, and elaborate detailed data sets that quantify energy supply and demand by fuel, transformation process, and energy-consuming sector, and also include development plans and projections for both energy supply and demand. LEAP provides a common analytical structure and tool for scenario analysis, allowing researchers to elaborate detailed energy datasets and scenario assumptions in a convenient and transparent way. As a result, a broader range of researchers ?including not only EAEF participants but also interested outside researchers? will be able to utilize the national energy datasets produced during the EAEF project, and to participate in the energy scenario analysis process. The use of a common analytical framework also simplifies the collaborative task of combining national energy futures into a coherent, consistent set of energy futures for the region as a whole.
EAEF workshops have brought together project participants from the countries of the Northeast Asia region on a periodic basis. In addition, the combination of an Internet web site for the project, e-mail list-servers, and other communications means are providing a forum for ongoing exchange of information and points of view between researchers. The fact that all participants use a common scenario modeling framework?including common methodologies, common time horizons for analysis, and a common research direction for the energy paths they develop?assures that researchers can readily understand the studies produced in each nation and easily communicate ideas and results to each other.
Assembling national energy datasets is the first step in developing and evaluating the feasibility of different energy scenarios using LEAP. Analysis using LEAP requires, preferably, detailed historical end-use data in order to assure that the quantitative estimates of the costs and benefits of different future energy paths are as robust as possible. In the first phase of the EAEF project, Nautilus Research Associate David Von Hippel complied energy data sets for Japan, China, Republic of Korea (ROK), Democratic People?s Republic of Korea (DPRK), Hong Kong, and Chinese Taipei, and carried out partial analyses of baseline energy paths using LEAP. This energy databases thus created were also used for analysis carried out in other Nautilus energy projects, including the Energy, Security and Environment in Northeast Asia (ESENA) Project and the Pacific Asia Regional Energy Security (PARES) Project. In the PARES project, Nautilus used LEAP and the LEAP Japan data set in collaborative work with Japanese and US partners in order to develop and evaluate alternative energy paths for Japan. The methodology for the analysis of the energy security impacts of different energy paths developed during the PARES project are expected to be adapted for use in the coming collaborative phase of the EAEF project. The PARES project, and the methodologies developed as a part of the PARES project, is briefly explained later in this report.
(Please Note: The LEAP energy data sets mentioned above, and the Excel files used to annotate and develop the LEAP data sets were provided to workshop participants on the CD-ROM distributed by Nautilus at the LEAP 2000 training workshop. The data sets are in LEAP version 95 format.)
In June of 2000, Nautilus Institute, in collaboration with Tsinghua University, organized a set of two workshops in Beijing. The first workshop, which took place over two days, consisted of presentations and discussions on Northeast Asian regional energy issues. This workshop was immediately followed by a three-day workshop on methods for energy and environmental security analysis, featuring the use of LEAP (at that time, version ?95). As a part of the regional energy issues workshop, Nautilus commissioned 12 papers from Chinese and other regional authors on a variety of topics related to energy futures in the region. These papers can be found online at http://nautilus.org/energy/eaef.
In the process of preparing and carrying out the first EAEF workshop, Nautilus was able to identify key organizations and individuals in the Northeast Asia region with the background and interest to participate in future phases of the ongoing EAEF project, and to serve as a loose collaborative network of regional energy researchers. The table below lists the EAEF project participants, organized by country.
Table I. Project Participants
CHINA Tsinghua University Zhang Aling
ROK Korean Energy Economics Institute
Hyun Jae Doh
Khabarovsk Economic Institute
Unified Power Grid of Russia
Central Research Institute of Electric Power Industry Tatsujiro Suzuki
University of Tokyo
Junichiro Oda, Takuro Kiuchi
Non-conventional Energy Development Center
Kwan Ho Kim
Korean Anti-Nuclear Peace Committee
Il Bong Kim
Electric Power and Remote Control Institute,
Ministry of Electricity and Coal Industry Jae Sue Kim
Nautilus Institute David Von Hippel
(Colleagues whose names appear in red constitute the informal ?Graduate Students LEAP Working Group?)
The goal of the third phase of the EAEF project is to produce updated national ?baseline? or reference and alternative energy scenarios for each of the countries in the region. This phase commenced in February of 2001 with an EAEF Framework Meeting to discuss national energy interests and priorities, and to begin the formulation of a common research framework for compiling national alternative energy scenarios. The February 2001 workshop elaborated common research objectives and analytical methodologies in order that national teams could begin developing national energy scenarios, as well as to simplify the future task of combining national energy futures into a coherent, consistent set of energy futures for the region as a whole. In addition, a second (week-long) analytical training workshop took place just following the February Framework Meeting to train regional researchers to use LEAP 2000 (the newly-released Windows version of the LEAP tool), which is to be used as the primary tool for scenario analysis by the EAEF collaborative research group.
Each country team is currently collecting energy data and conducting its own national energy analysis, with Nautilus Institute providing support and input upon request. The national scenarios, and particularly the ?alternative? scenarios, are expected to focus on improving national energy and environmental security situations over time, as discussed at the Framework Meeting. At the end of this third EAEF phase, each country will write a report summarizing the national paths/scenarios that they have developed. In addition, the EAEF research group will collaboratively summarize these results in a workshop report (each country team will have primary responsibility for the portion of the final report pertaining to their country).
The fourth phase of the EAEF project is expected to include an aggregation of the national-level scenarios developed in the third EAEF phase in order to evaluate the relative energy security implications of each set of scenarios (baseline and alternative) to the region as a whole. This phase of the project will develop one or more ?alternative regional? scenarios that involve and require regional cooperation at a significant level. Part of the task of the fourth EAEF phase will be to compare how these scenarios compare to the nationally optimized scenarios – scenarios in which each country pursues its own “most cost-effective” or “most energy-secure” path or other alternative paths. This fourth EAEF phase will allow the group to consider the effects on national and regional energy security of policies that promote regional energy interdependence relative to policies where relative to nations develop their energy systems based on largely independent, nationally-oriented interests. At the end of this fourth phase of the project, the EAEF group will create a synthesizing report providing an analysis of and commentary on the regional scenario results. The objective will be for the group to develop and speak with a clear single (consensus) voice whenever possible. The end result of the project will be a readable and clear demonstration of the benefits of one or several types of regional scenarios of energy sector development in Northeast Asia, including a set of implied policy recommendations, if applicable.
The goals of the Framework Meeting, held in February 2001 at the Nautilus Institute in Berkeley, California, were to elaborate ?a common research framework? for developing national energy scenarios and to discuss a set of ?common analytical tools? for generation and evaluation of energy scenarios. The analytical and conceptual approach elaborated in this meeting was also developed to ensure that the activities of EAEF phase three could serve as a foundation for scenario analysis at the regional level in the fourth phase of the project.
The common research framework that will be used in ongoing and future phases of the EAEF project is designed to draw on aspects of the energy security framework developed and used as a part of another Nautilus project, the PARES project (as noted above). The research framework also is designed to provide broad research directions as what kind of scenarios might be prepared and evaluated by each country group, to prepare and evaluate. Common analytical tools and methods used in this project will include the LEAP 2000 software, outlines for data collection and final reports, sample/initial data sets assembled by the Nautilus Institute, documents that provide guidance on building consistent data sets for each scenario, and guidance on approaches and methodologies for data collection. (Many of these tools and approaches were discussed in detail during the 5-day LEAP 2000 software training that followed the Framework Meeting.)
The first day of the Framework Meeting focused on the general methodology of scenario development, including how to use tools such as LEAP to quantify the feasibility of energy sector development scenarios, and how to support and evaluate scenarios in a quantitative way. Nautilus also presented some ideas for potential focal topics that the group might choose to use as directions for collaborative research on energy paths, including regional grid interconnection, sustainable energy development, and climate change. These presentations were followed up by group discussion of these suggestions. In the second day of the workshop, participants discussed individual country energy interests and priorities in order for the group to have a mutual understanding of the energy context of each individual country, as well as of the region as a whole. Some participants also presented conceptual ideas for use as background in developing possible ?optimized? national energy pathways.
Much of the methodology of the EAEF project will be based on a similar calculus developed under the PARES project. During the early part of framework meeting, David Von Hippel provided detailed background on and an explanation of the PARES project, and of the methodologies developed and used during the project. A summary of the PARES project and its results are provided for reference here, as the PARES project provides a model for scenario development activities that are being conducted in phase three of the EAEF project.
The PARES Project explored and developed methodologies to analyze the impacts of energy-sector choices on energy security?using a broad definition of ?energy security? ?in the Pacific Asia region. Initial analysis was applied to Japan ? resulting in the development of an alternative energy scenario for Japan that would result in improved national energy security relative to a baseline or reference scenario.
PARES began by bringing together key officials and researchers in the region, mainly in Japan, to explore and elaborate new and comprehensive definitions of energy security. The group also developed an analytical framework to evaluate the degree to which different energy “paths” would enhance or detract from energy security. This first phase of the PARES project produced an inclusive concept of energy security that could provide a basis for safe, secure, and sustainable energy policies in Northeast Asia.
The Japan case study of the PARES project examined the energy security implications of two different energy paths from 1995 to 2020: a “Business as Usual” path in which recent trends continue; and an “Alternative” path in which an aggressive policy effort accelerates implementation of energy efficiency, renewable energy, natural gas, and other relatively environmentally benign technologies. Table I provides a brief summary of assumptions and conditions upon which the scenarios developed for Japan in the PARES project are based.
Table I. Summary of Japan?s scenarios (PARES project)
|National Energy Interests and Priorities||Energy security|
Kyoto Protocol Target, Liberalization of Electricity Market
(Survival of nation, protection of welfare, minimize risk with fuel and services, environmental security, etc.)
Alternative energy path direction Improved energy and environmental security
Regional energy security
Common Assumptions for both BAU and Alternative scenarios Same level of energy service
Same future GDP growth rate and other measures of economic output
Same population and demographics conditions
Similar fractions of electricity generation supplied by nuclear reactorsBAU Scenario
More oil imports and oil transportation
Increases nuclear generation capacity as planned by the government
Based on most recent Energy Prospects up to 2010 by METI?s Advisory Council
Alternatives Scenario Increased substitution of natural gas
Aggressive energy efficiency, with a focus on the transport and other sectors
Aggressive renewable energy technologies implementation, new high-efficiency gas-fired electricity generation capacity, retirement of older fossil-fueled capacity, aggressive implementation of co-generation
Nuclear plants now being built will be finished, existing plants will be phased out at the end of their operating lives, but nuclear capacity will grow very little overall
Possible electricity rate reduction by liberalization (?)Data SourcesAsia Pacific Energy Research Center
Institute of Energy Economics of Japan
International Energy Agency
APEC Energy data base
Lawrence Berkeley Labs data
Nautilus Energy Data set collated by David Von HippelDifficulties and Uncertainties in LEAP data set Future of Japan?s economy and energy efficiency improvement in auto sectors are uncertain
The degree of future market liberalization is uncertainResults and Outcome Multi-objective (qualitative and quantitative) analysis showing the energy security benefits and costs of moving from the BAU to the Alternative energy path
Japan is able to meet its climate change convention obligations under the Alternative Path
The concept of fuel and technology diversity indices (measurable indices applied for comparison of alternative energy pathways)
An overall framework for comparison of energy security costs and benefits between energy paths
A key result of the PARES project derived from the quantitative analysis of the two energy using LEAP was the demonstration that it is advantageous to Japan from the economic, environmental, and security perspectives to adopt the “Alternative” path as opposed to the “Business-as-Usual” path. Some of the advantages of the alternative path accrue through an increase in the diversity of fuel supply, thus reducing loss-of-energy-supply risks.
(Please Note: The PARES Report has been provided on the CD-ROM distributed at the LEAP 2000 training workshop.)
The PARES Project intended to analyze the impacts of energy-sector choices on energy security in the Pacific Asia region. Although the PARES project developed its methodologies to analyze the impacts of various energy scenarios in nearly any given country, the project applied its methodologies thus far only for Japan as a case study. The EAEF Project aims to continue but the aims of the PARES project by applying the overall energy security analysis framework developed during the PARES project to other countries in the Northeast Asia region.
At the Framework Meeting, representatives from each country presented overviews of their national energy-sector interests and priorities. The following tables are short summaries of some of the key points made in these national presentations. (Note for participants: Please let me know if the tables below are accurate summaries of your presentations, or if you would like to revise the text in the tables, or to remove or add key points.)
Table II. Summary of National Presentations
|National Energy Interests and Priorities||
(Lower energy prices[??])
|Ongoing Near-Term Policies|
(Assumptions for BAU scenarios?)
(Red text part is the common in both scenarios)
Historically high economic growth rates in recent years (1990-1995 10%, 1995-2000 8% GDP annually)
Same and constant demographic change (population increase)
Energy shortage [DOMESTIC?]
Increase oil supply [DOMESTIC?]
Nationwide integration of what are currently 13 separate power grids
Privatization of the State Power Corporation, separation of generation and transmission elements into different companies
Large Hydro Electricity Development
Oil import increases
Restructure power mix (through promotion of hydropower)
Continued heavy coal usage
More focus on industrial than residential use
Further development and restructuring of the coal industry
Additional and alternative policies under consideration of development
More Environmentally-benign, sustainable energy growth
Promotion of clean energy
Promotion of Clean Coal technologies
Emphasis on energy efficiency
Phase out small coal-fired generators of capacity 50MW and below (between 1.1 and 1.8 GW were shut down each year between 1997 and 1999)
Reduce prices of electricity in order to substitute electric heating for coal boilers in areas where hydroelectricity is available
Development of Renewable Power Systems (however, the target for the 5-year plan covering 1996-2000, which was 400MW of wind power, could not be achieved, though 300MW of wind power was installed) [??]
Industrial shift from energy intensive industries, improve efficiency
Increased growth in the number of vehicles
China Statistical Yearbook and other Government publications
|Difficulties and Uncertainties||
Mismatch between urban and rural energy [NEEDS? SUPPLIES?], esp. rural areas [??]
No uniform national market [FOR ??]
Peak load capacity is not sufficient
Electricity pricing does not adequately cover costs of T&D [??]
No on-peak pricing of electricity (which would provide incentives to reduce on-peak usage)
Solar Thermal [SOLAR THERMAL WHAT? COOKING? WATER HEAT?] (replaces biomass) but no data on non-commercial sources
Natural gas pipeline (should be high pressure for long distance transportation, theft of gas [??]) might not be economical, but is needed for environmental reason
|Measures of Scenario Outcomes||
SOx, NOx emissions
Fraction of Coal usage
Republic of Korea (Dr. Chung)
|Current National Energy Situation and Trends||Weak energy supply structure (high reliance on imports)|
Energy intensive industries (the industrial sector consumes more than 50% of total national energy use)
Slowing economic growth over time (after an increase following the financial crisis of the late 1990s)
Ongoing privatization of electricity and natural gas industries
(and related social concerns about loss of jobs from loss of public control because of privatization)
Climate Change pressure to enter Annex I group
Difficulty in siting and acceptance of new nuclear power stations
Energy efficiency and renewables are still uncertain and dependent on government programs for their development
Energy consumption growing faster than the economic growth
Rapid growth of natural gas demand and nuclear power reliance
High share of energy intensive industries in Korean economy
Ongoing deregulation of energy industry (privatization of a number of public energy companies, deregulation and competition in oil industry)
Strengthening of the standards of environment restrictions for energy use
Government support for the improvement of energy efficiency and the development of renewable energyNational Energy Interests and priorities Fuel source diversification
Promote the Northeast Asia regional energy [??–OR OTHER GOODS AS WELL??] market
Extensively research prospects for building a natural gas pipeline from East Siberia
Introduction of competitive energy market (remove subsidies, carry out tax reform, introduce carbon tax and tariffs)
Regional oil storage cooperation
Aggregate market power regionally
Electricity trade within the region
Energy security (increase oil stocks from the current 60-day level to 90 days, diversification of energy import sources )
Privatization and introducing competition in electricity and natural gas industries
Energy price liberalization
Energy tax reform for fair competitions in energy market and strengthen the environment regulations (levy tax according to energy heat content and carbon contents emitted from energy use)
Encourage energy efficiency technologies and renewable energy development
Promote energy cooperation with Northeast Asian countries (building a natural gas pipeline from East Siberia to South Korea and Japan, electricity grid connections in the region, promote the oil product trade and oil storage cooperation within the region to mitigate the high dependency of Middle East on oil import)
Energy cooperation between North and South Korea
Difficulty in siting of energy facilities (particularly nuclear power)
|BAU Scenario||Modest economic growth over time (economic growth will be slower than the past)|
Change of industry structure (the share of service industry will be expanded, while that of energy intensive industries will be contracted)
Population growth rate will slow down
The speed of technology developments for energy efficiency and renewable energy is same as the past.Potential Elements of Alternatives Scenario Electricity trade within the region
Construction of oil transit base to promote the import of non-Middle East oil, such as African and Norwegian oil, in order to promote competition between oil vendors
Aggregate market power regionally for purchasing imported oil and gas
Regional oil storage
Fuel types and sources diversification
Energy supply security
Higher or lower economic growth than expected
Changes of energy price differences among the energy sources
Faster development of technologies for energy efficiency and renewable energy than expected
Stronger environmental regulation for energy use
Realization of energy cooperation projects in Northeast Asian region.Data Source Historical data from KEEI and other ROK Government Sources
Ministry Of Commerce, Industry and Energy (MOCIE)
Korea Energy Economics Institute (KEEI)
Korea Energy Management Corporation (KEMCO)
Korea Electricity and Power Corporation (KEPCO)
Korea National Oil Corporation (KNOC)Difficulties and Uncertainties Korean Peninsula situation
Uncertainty over the degree and speed in the transition of energy industry toward competitive and deregulated market
Uncertainty in the realization of Northeast Asian energy projects being studied and discussedResults and Outcomesl Energy demand & supply projection
l CO2 emission forecast
l The least cost energy structure for Korea
ROK (Prof. Shin)
|Current National Energy Situation||
Oil price increases resulted in flat growth of oil consumption
Energy consumption has grown faster than GDP
Energy import increase(1/4 of total imports is to purchase energy)
Restructuring (Restructuring has been made into law, KEPCO has broken its generation facilities into 5 subsidiaries, the 5 subsidiaries will be sold publicly in one year, KEPCO will continue to provide T&D service,)
Oil market liberalization
Electric market restructuring
Oil consumption doubled every ten years
Imports 97% of energy from other countries
Energy import comprises more than 20% of total import
Became IEA member from 2001
|National Energy Interests and priorities||To develop gas fields and complete LNG network|
Market restructuring, activate market mechanisms, establish competitive industry
Increase share of renewable energy source
Energy safety through market mechanisms (Insurance system, private insurance, insurance against and accident, for consumers)
Establish regional energy industry system
Provide energy supply security
Improve energy efficiency
Activate market mechanism of energy industry
Establish competitive system of energy industry (electricity and gas industry)
Increased use of alternative energy
Increase state oil stockpile to 60 days by 2006
Reduction of air pollutants (ozone, acid rain, etc.)
Northeast Asian energy cooperation (power interconnection, natural gas pipeline networks, joint oil stockpiling, North-South Korean energy cooperation, etc.)BAU Scenario The First National Energy Base PlanAlternative Scenario Ambitious alternative energy plan, or
Environmentally sound and sustainable North-South Korean energy cooperationData source Korean government, KEEI, EAEF, international agencyUncertainties and Difficulties North-South Korean relation
US-North Korean relation
North Korean energy situation
Increased oil dependency on Middle East oil
Kyoto Protocol and Climate Change ConventionResults and Outcomes Enhancement of energy security: supply security, economic impact, environmental security
|Current National (Energy) Situation||
Energy demand grows slower or flat, except in transportation and residential sectors.
Partial deregulation of the electric power market (30% – large industrial users since 4/2000, rest remains regulated)
Stagnant nuclear power development because of uncertain public acceptance issues, but commitments to existing nuclear projects is strong
Cogeneration and renewable energy use (and self-generation) continue to grow but modestly. (Renewable Energy Promotion Law)
Coal will increase its share [OF THE ELECTRICITY MARKET?] as coal-fired plants built and operated by Independent Power Producers are constructed.
|National Energy Interests and priorities||Energy supply security|
Nuclear energy development (controversial)
Natural gas pipeline development (controversial)
Meeting climate change framework obligations (climate change is the biggest environmental issue that affects Japan?s energy policy.)
(Official Scenario) Partial deregulation of the energy market
Government still has strong influence over energy policy
Strong commitment to nuclear developmentAlternative_1 Market Dominated Scenario Not much renewables energy technology implementation
Increase in fossil fuels consumption
Limited government control over energy policy and market
Energy/fuel import from Russia (?)Alternative_2 Environmentally benign scenario Implementation of Renewable Portfolio Standard
Introduction of Green Tariff, Green electricity tariff
Increase of Energy efficiency
Increase of natural gas
Backend privatization of nuclear (?)Data source Uncertainties and Difficulties It is not clear how fast the deregulation of the energy market would be introduced.
Uncertainties as to the political power of vested interests in specific energy supply technologies [??](in what?) and the social and political power of emerging environmental consciousness
Results and Outcomes
Measurable Outcomes Fuel diversity
CO2 emission reduction
Far East Russia
|Current Energy and National Situation||
1992-98 decline in economy (GDP dropped by 50%, energy consumption by 35%), resulting in surplus generation capacity decline in internal primary energy production
By 1999 the economy had started to recover (GDP increase 4%, energy consumption increase 3-4% annually)
36% of total primary energy is currently imported to the RFE
|National Energy Interests and priorities||
Growth in energy consumption
Sufficient energy supply to meet demand
Accelerate energy production to meet demand and to be able to export fuel
Cooperation with NEA countries
To improve energy efficiency
Renewables technology implementation
To diversify energy sources, especially non traditional and renewable energy
Environmental protection and sustainability
To promote advanced energy related technologies
To develop gas pipeline, power grid interconnection
Positive economic growth and energy consumption growth
Strict investment constraints (especially for power industry and gas pipeline infrastructure)
Energy dependence on domestic primary energy import
Conventional coal-fired technology use and modest use of renewable energy and gas
Limited possibilities for transfer of advanced energy related technologies
Modest improvements in energy efficiency
Weak environmental regulation and standards
Restrained promotion of energy market deregulation
Modest energy links with NEA countries
|Alternative Scenario Possibilities||
Develop regional gas pipeline or pipelines
Promote power grid interconnection (from hydro, coal-fired, and/or nuclear generation) through Harbin to NE China
Soft investment constraints
Strict environmental regulation and standards
Significant possibilities for transfer of advanced energy related technologies
Significant improvements in energy efficiency
Development of renewable (and probably nuclear) energy
Energy market deregulation
Energy links with adjacent NEA countries on pipeline natural gas and electricity
|Uncertainties and Difficulties||
Economic growth and energy demand in the FER
Costs of power generation with advanced technology, costs of future fuel production and pipeline construction and gas transmission
Poor internal actual energy data especially final energy consumption data
Environmentally related energy data
Energy security policy priorities in NEA countries
Future energy balance and timing of electricity needs in China and ROK
(How much energy will China need to import from RFE)
How will the Korean Peninsula?s political situation change?
Deregulation and openness of energy markets in China, Japan, ROK.
Decision making process and its transparency in Russia
Should East Siberia be included in the analysis?
Statistical Committees of the FER and Russia, Unified Power Grid of Russia “Vostokenergo”, built-in LEAP data set, Irkutsk Energy Systems Institute, Energy Year Books of developed northern countries (Canada, Sweden)
|Results and Outcomes||
Energy Scenarios Costs, Energy Savings and Environmental Effects, Energy Security Options
As national energy priorities and interests often vary considerably from nation to nation, different ?alternative? energy paths are being developed for each participating country. These scenarios will be based on the each country?s independent national priorities and interests. At the same time, however, national scenarios will need to be synchronous with regional interests, especially because the EAEF project plans to develop integrated regional alternative energy scenarios. For that purpose, the group will elaborate a set of common directions to be incorporated into energy paths – such as reducing environmental impacts or increasing energy supply security. Coherent regional analysis will also require a common base of knowledge and understandings on key topics; for example a consensus working definition of energy security. Common directions and understandings will allow researchers to more easily compare research results and work together.
Based on the national presentations at the Framework Meeting, the energy priorities that are common to all countries in the region are 1) energy supply security, 2) environmentally-benign energy development, and 3) energy conservation and improvement of energy efficiency. Means of improving energy supply security, as the term is conventionally and narrowly defined to emphasize security of oil supply, include, for example reducing dependence on oil imports, diversification of import sources, and creation of emergency oil reserves, and other means. Development of new and benign energy resources can include diversification of fuel types and sources, including natural gas pipeline development, electricity trading, and other new regional energy trades. In addition, environmentally benign energy development also can target reduction of emissions of SO2 (of particular interest in China and the ROK), CO2 (Japan, China), and NOx (China), reduction of nuclear waste (Japan), and reduction of emissions of other pollutants, clean technology implementation, renewable energy technology deployment, and other initiatives. Examples of energy conservation and energy-efficiency improvement policies include implementation of energy-efficient technologies (through a variety of means), shifts away from use of energy-intensive industries, modifications in urban design and transport systems, and a host of other options. .
At this stage, it is reasonable to use a combination of the three directions noted above as the overarching context for developing one or more feasible and energy/environmental security-enhancing aggregated alternative scenarios for the region. The assumptions and criteria used to develop individual national alternative scenarios, however, will be based on the specific national energy priorities and situations of each country.
A number of other key topics were also discussed at the Framework Meeting as potential research directions to be incorporated into the development of national and regional scenarios. Some of the discussion surrounding the topics of climate change, regional energy transportation networks, and power sector restructuring is briefly summarized here.
Climate change was discussed in the context of several national presentations and brought up as a potential scenario direction by Nautilus Institute. Japan is obligated by the Kyoto agreement to reduce carbon emission should the agreement become binding. China is also seriously concerned about carbon emission mitigation, because even with maximum implementation of clean energy technologies, China?s national carbon dioxide emissions will exceed those of any other nation within twenty years. Although China has not been obliged to reduce carbon emissions under the terms of the Kyoto protocol, some of the Chinese government?s key recent energy policy statements have indicated a desire to take steps to mitigate climate change. A number of participants voiced that climate change is not necessarily the most serious energy-related environmental concern in the Northeast Asia. For instance, the impacts of SO2 emissions constitute a much more immediate and urgent energy-related problem for the region to solve. In addition, many participants felt that it would be more practical to focus on generally ?optimal? energy paths rather than focus specifically on CO2 mitigation scenarios due to the political nature of the issue of climate change in the Northeast Asia region. Alternative scenarios geared toward more general sustainability and energy/environmental security-enhancing criteria would have many aspects that would relate to climate change. A number of members of the group voiced the opinion that for these reasons climate change issues should be considered at a second level of analysis, but not at the first (most prominent) level.
Another topic that surfaced as an important potential aspect of future scenarios is the development of regional energy transportation networks. Such transportation networks could play key roles in alternative scenario directions based on regionally-integrated energy security and environmentally-sustainable development. Given that the Northeast Asian region as a whole (excluding the Russian Far East) has relatively modest oil and gas reserves, and is projected to become the world?s largest oil and gas importer early in the next century, development of regional energy transportation networks (building gas pipelines, power grid interconnection, and other regional energy facilities) may be inevitable and necessary steps to improve regional energy security.
As an example, electric power grid interconnection in Northeast Asia has been proposed in order to improve the energy security in the region, as well as providing other benefits. The reliability of electricity supply may improve if each country could have access to an international source of emergency backup power. Environmental considerations provide an inducement for those planning the power sector in the countries of the region to seek alternative, “cleaner” sources of electricity.
Among EAEF participants, the Russian group has conducted significant research on potential regional energy transportation networks. The South Korean group is also interested in the energy network integration in the Korean Peninsula. Nautilus Institute has hosted a workshop on the topic of regional power grid interconnection in Northeast Asia; more information on this topic and on the “grid” workshop can be found at: http://nautilus.org/energy/grid
Privatization and/or restructuring and/or deregulation of the energy market have also proved to be important issues in all of the countries of the region except the DPRK. In virtually all of the countries of the region, however there is a great deal of uncertainty associated with what degree energy markets will be liberalized and on what time scale. The opening of the Asian energy market is considered by most to be inevitable. Each national alternative scenario should incorporate the possibility of power sector restructuring to whatever extent is possible – recognizing that there is some difficulty in making credible assumptions as to the nature of structural change of the regional energy market.
An area of discussion that surfaced at the meeting was the difficulty of proposing a truly optimal energy path due to the number of variables and uncertainties involved in energy paths modeling. Collaborators were concerned as to how we as a collaborative group could ascertain that even a BAU (Business as Usual) scenario is credible and physically possible. Uncertainties in compiling future energy paths cannot be eliminated, and consideration of uncertainties can certainly change the outcomes of both the BAU and Alternative scenarios. In response, David Von Hippel talked about how the PARES project dealt with these concerns. He made the point that all assumptions incorporated into the scenarios should be made transparent in order that other people reviewing the scenario work can have the opportunity to discuss whether the assumptions are reasonable and credible. The first BAU scenario is only a starting reference point. The whole LEAP energy scenario-making process is an iterative process requiring significant group discussion and evaluation to reach a level of agreement and sensitivity that is acceptable, and this process of discussion and evaluation is in fact key to accomplishing the goals of the EAEF project. The interactive process of generating, evaluating and revising scenarios must be repeated until the group consensus is that the scenarios that have been generated are reasonable.
Another important point for development of alterative scenarios is the need to strike a balance between selecting a scenario that is possible and at the same time is also significantly different enough from a BAU scenario that a comparison of the outcomes of the two scenarios is meaningful and informative with regard to future policy directions.
In the PARES project, the energy diversification index and the relative cost of implementing the changes included in the alternative scenario were two of several important measurable qualities. The group at the Framework Meeting did not discuss at any length what the key measures that would be used to judging the feasibility of alternative EAEF scenarios would be. Quantitatively estimating and presenting the relative costs and benefits of different energy scenarios, including deciding on which measures are most useful and persuasive, is therefore an area that requires further discussion in the third and fourth phases of the EAEF project.
The target audiences for the efforts of the EAEF project were a topic of brief discussion at the Framework Meeting. The target audiences for the work are agreed to be broad and various, but notably include governmental and international organizations that make decisions on energy policy in or affecting the countries of the region.
Part of the U.S. Department of Energy funding for the EAEF project has been provided for the support of graduate students in doing regional energy research. A working group of graduate students, working as EAEF participants under the guidance of their mentors (who are also EAEF participants), has begun the process of collection of data for use with the LEAP software. The main purpose of this working group is to prepare reference-case energy scenarios in each country of the region, either by updating and revising the old LEAP data sets collected by Nautilus in the first phase of the EAEF project, by preparing entirely new data sets, or by a combination of means.
The current members of the Graduate Student Working Group to date are Rebecca Hansing (of the University of California at Berkeley and Nautilus Institute); Baolei Guo (Tisnghua University); Junichiro Oda (Tokyo University); Takuro Kiuchi (Tokyo University) and Ho-seok Kim (Yonsei University). David Von Hippel will act as an advisor to the group as requested and as needed.
At the end of August 2001, each group is asked to provide to Nautilus:
A National Energy Paths Meeting is expected to be held at the end of October or the beginning of November, 2001. At this meeting, regional researchers will congregate to present and discuss their initial results, exchange LEAP data and views on methods, make plans for regional aggregation. The initial research results that could be presented by national groups at the meeting include:
Updated national LEAP data sets;
BAU scenario designs, assumptions, and results; and
Initial information on alternative scenarios, including designs, assumptions, and results.
At this point, the group will also need to plan for the preparation of national Alternative energy scenarios, and discuss the preparation of a Workshop Synthesis report on summarizing national Baseline and Alternative scenarios.
National BAU and alternative energy scenarios development could be continued until April or May, 2002.
Regional energy scenarios integration and analysis will be carried out starting after the initial national results are available. Work with collaborators to develop two or more consistent regional scenarios built on national paths will likely begin through a process of remote correspondence in 2002, with initial results prepared for dissemination and discussion within the study group. The process of designing and organizing the work of compiling and evaluating regional scenarios will continue at a workshop in the spring of 2002. The April or May 2002 regional energy paths and options workshop will focus on initial results of regional paths investigations and seek to prepare advanced energy paths designs. This workshop would likely also include discussion of next steps in collaborative (or other) work, progress reports from groups doing similar research and from other Nautilus projects with a bearing on energy futures.
The EAEF collaborating group will need to shortly begin planning for both the spring, 2002 meeting, and for a final workshop to discuss final phase 4 EAEF Regional Energy Paths results. The activity of this final project workshop would be to review, edit, finalize, and make plans for publishing and otherwise disseminating final Project and Workshop Reports. The result of the project will be a readable and clear demonstration of the benefits of choosing one type of energy path over another (on the national and regional scales), and some ideas about how to make the preferable paths happen in Northeast Asia (advice for policymakers). At this last meeting, we will discuss publication and dissemination of the project results in detail, and will also confer on ways to build on the EAEF project results and network in future national and international activities.
 Teams from each of the nations are expected to choose to produce LEAP data sets that, while they may or may not be based on the data sets previously compiled by Nautilus, will update those data sets, use additional county-specific data sources, and reflect country-specific points of view about future developments.
 Note that here ?optimal? is not used in the mathematical sense, that is, the LEAP software is not at present capable of producing paths that are optimal based on a specific objective function. ?Optimal? here means that the paths have been developed so as to provide what the researchers that developed them feel is a reasonably sustainable future energy development path that significantly enhances the energy and environmental security of the nation.