Stormy Energy Future and Security Strategyeneken.ieej.or.jp/data/6739.pdf · Energy demand . GDP ....

Stormy Energy Future and

Security Strategy

2016-5-26 IEEJ / APERC Symposium Former Executive Director, IEA President, the Sasakawa Peace Foundation Nobuo TANAKA

IEEJ：June 2016 © IEEJ2016

Oil as strategic commodity

“Safety and certainty in oil lie in variety and variety alone.”

2


© O

ECD

/IEA

201

5

London, 10 November 2015

3


The start of a new energy era?

• 2015 has seen lower prices for all fossil fuels

– Oil & gas could face second year of falling upstream investment in 2016

– Coal prices remain at rock-bottom as demand slows in China

• Signals turn green ahead of key Paris climate summit

– Pledges of 150+ countries account for 90% of energy-related emissions

– Renewables capacity additions at a record-high of 130 GW in 2014

– Fossil-fuel subsidy reform, led by India & Indonesia, reduces the global subsidy bill below $500 billion in 2014

• Multiple signs of change, but are they moving the energy system in the right direction?

WEO2015 4


Low Oil Price Scenario

WEO2015

What will happen if Oil Price of $50 per barrel continues well into 2020s? 5


6


7


A new balancing item in the oil market?

Change in production (2015-2020) of US tight oil for a range of 2020 oil prices

Tight oil has created more short-term supply flexibility, but there is no guarantee that the adjustment mechanism in oil markets will be smooth

-4

-3

-2

-1

0

1

2

$40/bbl $50/bbl $60/bbl $70/bbl $80/bbl $90/bbl $100/bbl

mb/d

WEO2015

8


Mtoe

-300

0

300

600

900

1 200

Demand growth in Asia – the sequel

By 2040, India’s energy demand closes in on that of the United States, even though demand per capita remains 40% below the world average

European Union

United States

Japan Latin America

Middle East

Southeast Asia

Africa China India

Change in energy demand in selected regions, 2014-2040

WEO2015

9


2013 2020 2030 2040 2015

Instability in the Middle East a major risk to oil markets

Oil production growth

The short-term picture of a well-supplied market should not obscure future risks as demand rises to 104 mb/d & reliance grows on Iraq & the rest of the Middle East

+5

+10

+15

-5

2013 2020 2030 2040 2015

Net decline in output from other producers

Increase to 2040: 14 mb/d

mb/d

Increase to 2040: 14 mb/d

Middle East

Brazil

Canada United States

& reliance grows on Iraq & the rest of the

Middle East

in United States, Canada, Brazil & the Middle East

WEO2014

10


WEO2014

base

11

Geopolitics of the Shale Revolution: Strategic

Positioning of Oil / Gas exporters and importers.


The Shale revolution in the US achieved Win-Win-Win. Economy, Environment and Energy Security.

-15% -10% -5% 0% 5% 10% 15% 20% 25%

Renewables

Coal-fired power output

Coal demand

Gas-fired power output

Gas demand

CO2 emissions

Total primary energy demand

GDP (MER)

From 2006-2011, United States CO2 emissions went down by 7% due to coal-to-gas fuel switching, power generation efficiency gains & increased renewables output

WEO2012

12


North American Energy Independence and Middle East Oil to Asia: a new Energy Geopolitics

Middle East oil export by destination

By 2035, almost 90% of Middle Eastern oil exports go to Asia; North America’s emergence as a net exporter accelerates the eastward shift in trade

7

United States Japan & Korea Europe China India

mb/d 2000

2011

2035

1

2

3

4

5

6

IEA WEO2012

13


USDOD China Report 2015 14

China’s Oil and Gas Import Transit Routes:

One Belt and One Road (一帯一路）

Figure 2. China’s Import Transit Routes.


Should China and India join the IEA？

Net oil imports of selected countries in the New Policies Scenario (mb/d)

Asia becomes the unrivalled centre of the global oil trade as the region draws in a rising share of

the available crude

5

10

15

20

25

OECD China & India

2000

2012

2020

2035

15


Gas on the way to become first fuel, with role of LNG on the rise

Main sources of regional LNG supply

Share of LNG rises in global gas trade, pushed by a near-tripling in liquefaction sites: LNG brings more integrated & secure gas markets, but only limited relief on prices

Middle East

Australia

US & Canada

East Africa

Russia

North Africa West Africa

Other

Middle East

Southeast Asia

West Africa Australia

North Africa Other

100

200

300

400

500

600 bcm

2012 2040

WEO2014

16


Natural Gas Import Infrastructure in Europe

IEA Medium Term Oil and Gas Markets 2010 17


Mid-Term Oil & Gas Market 2010, IEA

Russian Gas Pipelines Will Extend to the East: Recent China Deal

18


Blue Print for North East Asia Gas & Pipeline Infrastructure:

Dr. Hirata’s Concept

19


Trading hub – Asian-tailored solution?

Southeast Asian countries are already interlinked by pipeline and plan to increase these linkages through Trans ASEAN Gas Pipeline (TAGP) and LNG.

TAGP and LNG terminals in Southeast Asia

The Asian Quest for LNG in a Globalising Market

20


Possible Pipeline Project from Russia to Japan

Estimated volume of 8bcm pa

21


Russian LNG and especially pipeline gas is more competitive

at 10$/Mbtu, some projects – even at 8$/MBtu

3.3 3.0

1.0 0.4 0.8

-4

-2

0

2

4

6

8

10

12

14

Production Prod tax Pipeline Export duty Liquefaction LNG transp Regasification Margin

$/MBtu

Source: ERI RAS タチアナ・ミトロバロシア科学アカデミーエネルギー研究所 22


Final Draft (7 June 2013) Technical Summary IPCC WGI Fifth Assessment Report

Do Not Cite, Quote or Distribute TS-119 Total pages: 127

TFE.8, Figure 1: Global mean temperature increase since 1861–1880 as a function of cumulative total global CO2

emissions from various lines of evidence. (a) Decadal average results are shown over all CMIP5 EMIC and ESMs for

each RCP respectively, with coloured lines (multi-model average), decadal markers (dots) and with three decades

(2001–2010, 2041–2050 and 2091–2100) highlighted with a star, square and diamond, respectively. The historical time

period up to decade 2001–2010 is taken from the CMIP5 historical runs prolonged by RCP8.5 for 2005–2010 and is

indicated with a black thick line and black symbols. Coloured ranges illustrate the model spread (90% range) over all

CMIP5 ESMs and EMICs and do not represent a formal uncertainty assessment. Ranges are filled as long as data of all

models is available and until peak temperature. They are faded out for illustrative purposes afterward. CMIP5

simulations with 1% yr–1 CO2 increase only are illustrated by the dark grey area (range definition similar to RCPs

above) and the black thin line (multi-model average). The light grey cone represents this report’s assessment of the

transient climate response to emissions (TCRE) from CO2 only. Estimated cumulative historical CO2 emissions from

1850 to 2011 with associated uncertainties are illustrated by the grey bar at the bottom of panel a. (b) Comparison of

historical model results with observations. The magenta line and uncertainty ranges are based on observed emissions

from CDIAC extended by values of the Global Carbon project until 2010 and observed temperature estimates of

HadCRUT4. The uncertainties in the last decade of observations are based on the assessment in this report. The black

thick line is identical to the one in panel a. The thin green line with crosses is as the black line but for ESMs only. The

yellow-brown line and range show these ESM results until 2010, when corrected for HadCRUT4’s incomplete

geographical coverage over time. All values are given relative to the 1861–1880 base period. All time-series are derived

Carbon Budget 515Gt had been emitted by 2011. 2C scenario needs to stop at 790Gt.(66%). 790-515=275Gt budget left. Annual 2012 =9.7Gt 275/9.7=Only 28 years to go!

IPCC WGI Fifth Assessment Report Climate Change Cannot Wait.

23


but – for oil & gas – the gains are offset by the move to more complex fields

Policies spur innovation and tip the balance towards low-carbon

Costs in 2040 for different energy sources/technologies, relative to 2014

-60%

-40%

-20%

0%

20%

40%

60%

Solar PV Onshore wind

Efficient industrial heat production

Efficient lighting

Upstream oil and gas

Innovation reduces the costs of low-carbon technologies & energy efficiency,

24


Power is leading the transformation of the energy system

Global electricity generation by source

Driven by continued policy support, renewables account for half of additional global generation, overtaking coal around 2030 to become the largest power source

3 000 12 000 15 000

TWh

Change to 2040

2014 Renewables

Coal

Gas

Nuclear

Oil

Hydro

Wind

Solar

Other renewables

Of which:

6 000 9 000

WEO2015

25


Energy demand

GDP

A new chapter in China’s growth story

Along with energy efficiency, structural shifts in China’s economy favouring expansion of services, mean less energy is required to generate economic growth

3 000

6 000

9 000

2000 2010 2020 2030 2040

Ener

gy d

eman

d (

Mto

e)

20

40

60

GD

P (

trill

ion

do

llars

, PP

P)

Energy demand

GDP

Total primary energy demand & GDP in China Energy demand in China

1 000

2 000

3 000

4 000

Coal

Oil

Gas

Nuclear

Renewables

Energy demand

GDP

3 000

6 000

9 000

2000 2010 2020 2030 2040

Ener

gy d

eman

d (

Mto

e)

20

40

60

GD

P (

trill

ion

do

llars

, PP

P)

WEO2015

26


Climate pledges decouple power sector emissions from electricity demand

World electricity generation

The share of low-carbon power generation grows to almost 45% in 2030 so that power emissions remain flat, while electricity demand grows by more than 40%

10

20

30

40

Gen

erat

ion

(th

ou

san

d T

Wh

)

and related CO2 emissions

1990 2000 2010 2020 2030

Emis

sio

ns

(Gt)

5

10

15

20

CO2 emissions

Electricity generation

Electricity generation

CO2 emissions

WEO2015

27


Energy self-sufficiency* by fuel in 2011

Source: Energy Data Center, IEA.

* Self-sufficiency = domestic production / total primary energy supply

Note: Does not include fuels not in the fossil fuels, renewables and nuclear categories.

11%

14%

15%

21%

6%

46%

12%

23%

28%

16%

9%

17%

32%

17%

10%

1%

10%

1%

1%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

IEA

European Union

Korea

Luxembourg

Belgium

Japan

France

Spain

Slovak Republic

Ireland

Switzerland

Italy

Portugal

Hungary

Turkey

Germany

Finland

Austria

Sweden

Greece

Czech Republic

United Kingdom

Poland

India

United States

Netherlands

China

New Zealand Fossil fuels

Renewables

Nuclear

24%

52%

96%

10%

8%

26%

14%

11%

0% 20% 40% 60% 80% 100% 120% 140%

EU28

IEA28

ASEANFossil fuelsRenewablesNuclear

Collective Energy Security and Sustainability

by Diversity, Connectivity and Nuclear

WEO 2013 basis

28


Power Grid Connection in Europe: Collective Energy Security and Sustainability

Physical energy flows between European countries, 2008 (GWh)

Source: ENTSO-E

29


Connecting MENA and Europe: " Desertec" as visionary “Energy for Peace"

Source: DESRETEC Foundation 30


ASEAN power grid connection

31


GOBITECH Initiative

Renewable Energy in Asia through Sun and Wind

33


Чистая энергия

387

I stage

II stage

Sakhalin GRES

Nokliki GTES

Sakhalin GRES-2

Yuzhno-sakhalin TPP

Mayskaya GRES

Sovgavan TPP

Comsomol TPP 1-3

Amur TPP

Nikolaev TPP

CL 500 kV

III Stage

TP Gornozavodskaya

Dolinskaya TPP

Total cost for 3 stages in the Russian part of the Project is

estimated at USD 5.7 billion. excluding costs for the

construction of additional generation in the UES of the East to

increase exports volumes

P/S, OL 110 kV P/S, OL 220 kV new OL TP OL/CL – transition point of OL/CL, CL – cable line

Tokyo

Stage Ключевые мероприятия в

российской части

Export

volume

Actions for the laying of

underwater cable

Stage I

(2020)

• The construction of the 2-3

stages of the Sakhalin

GRES-2 with the increase of

installed capacity up to 360

MW

• The construction of grid

infrastructure (additional OL,

OL/CL converter station

Gornozavodskaya)

Up to 400 MW Installation of underwater cable

from Sakhalin island to

Northern Hokkaido

(Ishikari/Wakkanai) with a

distance of 50-200 km*

Stage II

(2022)

• The construction of a large

export-oriented generation

"Dolinskaya TPP" (up to 660

MW)

• Further expansion of the

network infrastructure

Up to 1000

MW

Installationof underwater cable

from Hokkaido

(Ishikari/Wakkanai) to Aomori

(Honshu) with a distance of

650-800 km*

Stage III

(2025)

• The connection of the

Sakhalin energy system

with the United Energy

System of the East by

underwater DC cable

2-4 GW Installation of a submarine from

Aomori (Honshu) cable to

Kashiwazaki (Honshu) with a

distance of 400 km

* - depends on the choice of connection point in Japan

Power Bridge Project by Roshydro

34


Lack of Grid connectivity in Japan

Source: Agency for Natural Resources and Energy, The Federation of Electric Power Companies of Japan, Electric Power System Council of Japan, The International Energy Agency

Tokyo

Hokkaido

Tohoku

Hokuriku Kansai Chugoku

Kyushu 29GW

Shikoku 12GW

Chubu 40GW

Okinawa 2GW

Hydro Oil

Gas

Nuclear

Coal

Other

Power utility company

Generating company

In-house generation

--- 50 hz

60 hz <-------

35


New Policies Scenario WEO 2013

Impact of 450 ppm

Scenario on Oil Market

The Stone Age didn’t end because we ran out of stones. 36


Japan Economic Journal 2016-1-21

Sustainable Nuclear Power

37


Contact :[email protected]

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