Aligning climate change andsustainable energy development inThailand
Ram M. Shrestha
Asian Institute of Technology
School of Environment, Resources and Development
Thailand
15 June 2006
Developing Visions for LCS through Sustainable Development, 13-16 June 2006, Tokyo, Japan.

Contents
I.

Overview of Thailand’s energy andenvironmental situation

II.

Potential for energy efficiency improvements

III.

IV.

Climate-friendly energy strategies/policies
A. Road transport and biofuel program
B. Implications of CO2 reduction target
Concluding remarks

2Overview of Thailand’senergy andenvironment situation

3

Fast increasing of GDP, energy consumption andCO2 emissions

Index (1990=1)

2.6
CO2

2.2

1.8
Energy use
GDP
1.4
Population
1.0
1990

1992

1994

AAGR (1990-2004):
CO2 emissions: 6.6 %Energy use:
6.4 %
GDP:
4.8%
Population:
1.1%

1996

1998

2000

2002

2004

• Growing energy demand• Per capita CO2 emission doubled in
2004 compared to 1990.
4

Energy use per unit of GDP (“energy intensity”)
Country/region

AAGR (%)(1990-2002)

Energy intensity(kgoe/US$ at 1995 prices)

Thailand

1.135

0.45

Philippines

0.906

0.43

South Korea

0.857

0.30

Indonesia

0.247

0.70Japan

0.004

0.09

OECD total-0.840

0.19World-0.974

0.29

Asia excluding China-1.064

0.64

India-1.979

1.04

Vietnam-2.485

1.28

China-6.246

1.02
Source: IEA (2004)

Primary energy intensity has been increasing (AAGR: 2.3%) in Thailand
during 1994-2002.
=>Potential for energy efficiency improvements and reduction in the use offossil energy and CO2 emissions.

5Increasing share of fossil-fuels
100000 Unit: ktoe
Electricity
Coal
80000

60000

New and renewables

Natural gas

40000
Oil
20000

01990

19921994

 Primary energy supply: Share of fossil fuels:

1996

1998

2000

1990: 45 Mtoe
1990: 65%

2002

2004

2004: 99 Mtoe
2004: 83%

AAGR (1990-2004):
Coal: 8% ; Oil: 4.6% ; Natural gas: 11.1%
Electricity: 4.8% and New and renewable energy: 0.1%
6

Increasing energy import dependency
60%
57.4%
55.6%

55.1%

55.5%

2002

2003

55%
51.9%
50%

45%
2000

2001

2004
Source: IEA (2004) and DEDE (2005)• In 2004 alone, energy import accounted for 8.6% of thetotal GDP (US$14 billion).
7

Growth of CO2 emission per unit of GDP(“carbon intensity”)
Carbon intensity in 2002
(kg of CO2/US$ at 1995 prices)
2CO2 emission intensity (Index: 1972=1)
Indonesia
Thailand

1.6

1.2
Asia (excluding China)
0.8WorldJapanOECD

0.4
1972 1974 1976 1978 1980 1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002

Country/region

2002

Japan

0.21

South Korea

0.66

Thailand0.97

Indonesia

1.37

OECD

0.44

World

0.68

Asia (ex. China)

1.22

Source: IEA (2004)

Increasing CO2 emission intensity (AAGR: 2.6%) inThailand during 1990-2002.

8

Trends of local air pollutant emissions
Unit: thousand tons
3500
CO

3000
2500
2000
1500

SO2NOx

1000
500

SPM01993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004
Source: DEDE (2000-2004)

AAGR (1993-2004)

SO2-8.4

NOx

5.4

CO0.5

SPM*

29.1

* AAGR (1993-1999)

9

Potential for energy efficiency
improvements

10Potential to improve energy efficiency in coal-fired powerplants.

4541.9

2002

40

33.1

30

26.8

28.0

29.1

36.6

35.9

36.7

36.9

5%

30.0

2520
15
10
5JapanTh
ailandO
EC
DanyGerm

USAW
orldnaChiAsiaIn
donesia

Vietnam0In
dia

Efficiency (%)

3534.8Sources: IEA (2004) based on public electricity plants. For Japan, Germany and USA data are from ECOFYS (2005)

Potential efficiency improvement of 5% (compared to Japan)
corresponds to about 12% reduction in coal requirements inpower sector. This implies CO2 emission reduction of over 12%.
11

There is also a potential to improve energy efficiency ingas-fired power plants.
60
52.1

50
40

41.8

41.0

40.9

40.4

39.5

43.8

41.9

47.5

44.2

31.2

30
20
10

ia
IndahinCJapan

DOECSAUia
AsIndonesialdWorndilaThaanym
GerVietnam

0Sources: IEA (2004) based on public electricity plants. For Japan, Germany and USA data are from ECOFYS (2005)

Potential efficiency improvement of 3.8% (compared to Japan)
corresponds to about 8.6% reduction in natural gas requirements inpower sector.
12T h erm al co n su m p tio n (kcal/kg o fclin ker)

Specific thermal energy consumption ofcement production
800

788
770

750

18.5%

690

700665650
600
ThailandBAT*IndiaJapanSource: Siam Cement Group Sustainability report (2005); NCCBM (2004); Worrell and Galitsky (2004)

Note: * Best available technology (BAT) is based on dry-6 stage pre-heater twin stream precalcinator pyro-step cooler technology.

The reduction in specific energy consumption by 18.5% could
reduce total industry sector energy use by 2% (438 ktoe) in 2004.
13

Specific energy consumption of paper production
3.4

Gcal/ton of paper production
3.34

3.3
3.2

14.8%

3.1
3

2.91
2.9
2.8
2.7
2.6
Thailand

BAT*Note: * Best available technology (BAT) is based on Modern Kraft Market Pulp Mill.
Source: SCG (2005); NRC (2002)

This 14.8% translate to reduction of 0.2% (i.e., 40 ktoe) of totalenergy use in industry sector in 2004.
14Energy cost reduction in commercial sector:An example

0.0350Electricity intensity(kWh per Baht at 1988 price)0.03000.0250Commercial and public services

0.02000.01500.01000.0050
1971

1974

1977

1980

1983

1986

1989

1992

1995

1998

2001

2004

 About 20 million Baht (0.5 million US$) per year could be saved.
(About 15 US$ saving per sq. m. per year) About 82.6% reduction in electricity requirement.
 Energy use for air conditioning is growing
rapidly.
Source:http://www.rrcap.unep.org/ecohouse/
15

Climate-friendly energy
strategies/policies:
More a response to economic and energy
security concerns

16Five energy strategies of Thai government
Enhancing efficiency in the transportsector;
Enhancing efficiency in the industrysector;


ENCON fund

Enhancing national energy security;
Enhancing overall capability in energy
management and integration; andBecoming a regional energy hub.
17Energy strategies (contd.) Establishment of 1992 Energy Conservation

Promotion Act Establishment of ENCON Fundto support activities related to energy efficiency

and energy conservation

Specific national energy targets/“strategies”:
 to reduce oil consumption by 20% by 2009; To increase the share of new and renewableenergy use to 8% by 2011.
 Renewable Portfolio Standard (RPS): toincrease the share of RE based power
generation capacity to 6% of total capacity by
201118Electricity

Thailand’s ambitious renewable energy policy

RPS 140 MW- Solar- Wind- MSW- Biomass- HydroElectricity
Solar6 MWWind0.2 MWBiomass 560 MW

Heat~ 0.00 ktoe

RPSINCENTIVE

Incentive
1,425 MWRE8%RE
0.5%

Biofuels

R&D~ 0.00 ktoe

Facilitator

Total demand

3,910 KTOE

Biofuels (Incentive)
3,100 ktoe
Ethanol 3.0 M liters/day
Bio diesel 4.0 M liters/day

Strategies
2002
52,939 ktoe

Heat(Incentive)

2011

81,763 ktoe

Target19

Biofuels program in Transport sector

20Key characteristics of transport sector
Transport accounts for 37% of total final energy demand in2004.
 High share of road transport in transport energy demand(78% in 2004)
 Low share of public transport
 Low share of MRT/rail transport
1901

2000
1800
1600
1400
1200
1000
800
600
4002000

Rail passenger-km per capita in 1999

1105
906

884
655

nesia
*76

In
doland

164

Thai

hi
na

323

Ca*

412

Indiain

*
Ko
rea

Sp

yan

SouthermGeetherl andsancN

Fr

Ja

pan

458

Note: * 1998 data. Source: World Bank Railway database 2001

21

Biofuels utilization target and policy
Utilization of 3.0 million liters of ethanol per day by2011;

Utilization 8.5 million liters of bio-diesel per day by2011;

Subsidy of 1.5 Baht per liter of gasohol.

22Effects of biofuels on CO2 emissions: An
AIM/Enduse Model Analysis

Scenario

Description

I

Base case with limited production of biofuels(Government plan)

IINo limit on biofuels production and no subsidy

III

Doubling the blend of biofuels + Scenario II

23

Percent Reduction wrt no biofuels
in 2035

Reduction in CO2 emissions with biofuel program in 2035
20
1816
14
12
10
86421895IIIIII

Scenario

About 5% of total CO2 emissions from road transportation
could be reduced with the government plan.
Without any limits on domestic production of biofuels, 9%of total CO2 emissions could be reduced.
24Percentage of Imported Fuels in Road
Transport Sector

Reduction in oil imports with biofuels promotion (2035)
96
94
92
90
88
86

95
91

84
82
80
78
76
74

82

I

II

III

With the government plan, about 5% of the fuel import in road transport
could be reduced in 2035.
As high as 18% of the fuel imports could be reduced if the blend ofbiofuels is doubled.
25

Implications of a CO2 emissions reduction
target:An AIM/Enduse Model Analysis26

What changes in primary energy mix are needed toattain 10% CO2 emission reduction during 2010-2030?
Percentage change with base case

15105CoalOil

Natural gasBiomass

(5)
(10)
(15)
(20)
(25)

With a 10% CO2 emissions reduction target,
 coal share to decrease by 22% natural gas to share increase by 8%
 Biomass share to increase by 3%
27

Contribution of each sector tocumulative CO2 emissions reduction (%)

Sectoral shares in cumulative CO2 emissions reduction
during 2011-2030 (reduction target: 10%)706058504028302015100PowerIndustrialTransport

Power sector will have the highest share (58%), followed
by transport (28%) and industry (15%) sectors.
28

Percentage reduction in ER10
compared to base caseCo-benefits: Reduction of SO2 and NOx emissions during
2011-2030
30

27

25
20
15
106

50NOx

SO229

Role of energy from biomass including waste in future?

Japan

1. 4Korea

1.4

Share of biom ass including w aste
in total TPES in 2002 (%)

Sweden16 .3

Thailand

16 .4

China
Finland
BrazilIndonesia

17.7
19 .9
2 4 .32 7.4

30

Regional energy development Hydropower in Thailand almost fully

exploited Low fossil energy reserve, negligible windpower and geothermal potential
 Regional cooperation on cleaner energy(e.g., hydropower in Laos and Myanmar,natural gas in Myanmar, Malaysia,
Indonesia) an option31

Effects of Carbon tax:
An AIM/CGE Analysis

32Percentage change in CO2 emissions from industry andtransport sectors with carbon tax compared to base case
-2.84

CT200-4.52

-1.48

CT100

-2.96

-0.32

CT25-2.11-0.06 -0.52 CT5-8-7-6-5Industry-4-3-2-10Transport• In industry sector, the range of CO2 emission reduction varies from about 0.5% (3million tons) with CT5 to 4.5% (26 million tons) with CT200.
• Reduction in CO2 emissions mainly comes from fuel switching and reduction in energy
consumption in the industry sector through structure change.
33

Concluding remarks


There exists large potential for energy efficiency
improvements in Thailand which can promote climate
friendly sustainable energy development.

Renewable energy (biomass) is already playing asignificant role in the energy system and may have
limited role in the long term. Wind, hydro and geothermal have limited potential in the country.

Shift towards biofuels in road transportation andincreased share of public transportation (MRT): potential
climate friendly sustainable options in the long run.

Besides energy efficiency improvements, new andrenewable technologies will have to be considered for
GHG reduction.
 Regional clean energy development an option.
34

THANK YOU.
ram@ait.ac.th
www.ait.ac.th35