Post Fukushima Energy Strategy: Energy Security and Sustainability in Asia

2012/10/31 Tokyo
Sasagawa Peace Foundation and W. Wilson Center
Nobuo TANAKA
Former Executive Director of the IEA
Global Associate of Energy Security and Sustainability, IEEJ
© OECD/IEA 2011

Energy Demand grows in Asia. Energy Security
is the issue for Asian countries.
IEA WEO 2011

Mtoe

Growth in primary energy demand
4 500
4 000

China

3 500

India

3 000

Other developing Asia

2 500

RussiaMiddle East

2 000

Rest of world

1 500

OECD

1 00050002010

2015

2020

20252030

2035

Global energy demand increases by one‐third from 2010 to 2035,with China, India and other Asia accounting for two thirds of the growth2

New Policies Scenario assumes Natural gas &renewables become increasingly important.

Mtoe

World primary energy demand

IEA WEO 2011

5 000

Additional
to 2035

4 000

2010

3 000
2 000
1 000
0
Oil

Coal

Gas

Renewables

NuclearRenewables & natural gas collectively meet almost two‐thirdsof incremental energy demand in 2010‐2035
3Oil supply security is particularly the issue for Asia
in the 21st Century.
IEA WEO 2011

Mb/dNet imports of oil142000

122010102035

86420EuropeanUnio nUnitedStatesJapan

ChinaIndia

ASEAN

US oil imports drop due to rising domestic output & improved transport efficiency:
North American Energy Independence is coming! ( WEO 2012 )4

Iran Crisis and the Hormuz Strait
85% of Japanese oilimport
20% of Japanese
LNG
import
20% ofJapaneseBut
no nuclear
LNGifimportreactors arerunning,,,,,,?
17 mbd of petroleum(20% of global demand )82 million tons of LNG pa(30% of global demand)

55

IEA Petroleum Strategic Stock can relieve 2mbd
disruption for 24 months.

1974 disruption was 4.3mbd. 1979 was 5.6mbd. Hormuz blockage is１３ mbd.
6

Strategic Petroleum Reserve: Does thecurrent IEA system continue to work?
IEA stockholding cover of global oil demand

3550%% share of world oil demand

40

30
40%

2530%

20
1520%

1010%

days of world oil demand cover

60%

50%

‐IEA 90 days of stockholding, share of world demandwith China
with India
with ASEAN
Share of non‐OECD in global oil demand

Growing share of non‐OECD oil demand results in declining global demand
cover from IEA oil stocks

7Compounding Crisis may hit Japan• Blockage of the Strait of Hormuz– Oil Price may double to $160 / barrel– Japan’s current account surplus ( 9 trillion yen in 2011 )may turn to deficit of 6 trillion yen.
– Without further restarting of nuclear power plants,deficits may reach 12 trillion yen.

• Confidence on Japan’s public finance may be lost.
– Current Account surplus is the basis for confidence– Persisting Deficit may lead to capital flight from Japan– Power crisis enhances flight of manufacturing industries• Loss of Confidence in JGB and Yen.

8

The Golden Age for Natural Gas ?
Shale Gas Revolution.
Largest natural gas producers in 2035

IEA WEO 2011
Conventional

RussiaUnited States
China

Unconventional

IranQatar
CanadaAlgeria
Australia
India
Norway
0200

400

600

800

1 000bcm

Unconventional natural gas supplies 40% of the 1.7 tcm increase in global supply,
but best practices are essential to successfully address environmental challenges
9The Golden Age for Natural Gas?
Asian Demand Increase is the game changer.

bcm

Figure 2.18

Natural gas demand and the share of imports by region in theNew Policies Scenario, 2009 and 2035

800Imports

700Domes c
produc on

600
500

IEA WEO 2011

40030020010002009 2035
United States2009 2035
Japan2009 2035
European Union

2009 2035
China

2009 2035
India

2009 2035
Other Asia

Note: Other Asia had net natural gas exports of 56 bcm in 2009.

China’s demand is 97 BCM in 2009, same as Germany,
In 2035 it grows to 502 BCM same as Europe as a whole in 200910

Overseas Investments by Chinese National Oil Companies: Assessing the Drivers and Impacts
11

Russia’s focus will move to the East
Russian revenue from fossil fuel exports
2010$255 billion

China2%Other21%
OtherEurope
16%

IEA WEO 20112035
$420 billion

Other
17%
EuropeanUnion
61%

EuropeanUnion
48%

China
20%
OtherEurope
15%

An increasing share of Russian exports go eastwards to Asia,
providing Russia with diversity of markets and revenues
12Russian Natural Gas Pipelines
Figure 8.15

IEA WEO 2011

Major gas fields and supply infrastructure in Russia

Chukchi
Sea

Selected gas field
Existing gas pipeline

Other offshore Arctic

Pipeline planned/under const.

BeringSea
East SiberianSea

Existing LNG export terminal

Barents Sea

Planned LNG export
Norwayterminal
Neth.

Den.

EuropeSlov. Rep.
HungarySouth

BalticSea

PechoraghLi ts
Ukhta

Moscow
Mol. Ukraine

Volga/
Urals
Volgograd

CaspianGeorgia
TurkeyArm.

Khvalynskoe
Tsentralnoe

Sakhalin
Sea ofOkhotsk

Sakhalin
IslandR U S S I A
Komsomolsk

Western Siberia

Chayandin
Krasnoyarsk

Tomsk

Astrakhan

Yakutsk

Eastern Siberia

Urengoy
SurgutTyumenS. Russkoe
Zapolyarnoe

Yamburg
Medvezhye

Orenburg

BlackSea

Syria

Yamal
SouthTambei
Peninsula
Timan
Bovanenkovo

rthenoN

StreamKara Sea

BarentsSea

Estonia
LatviaLithuania
St. Petersburg
Belarus

LaptevSeaMurmansk

Export toFinland

atreSmdroN

PolandCz.
Exportto
Rep.

Romania

SwedenFinland

GermanyExportto
EuropeOther offshore ArcticShtokman

Novosibirsk

Khabarovsk
KovyktaDaqingKemerovo
IrkutskHarbinVladivostok

Kazakhstan
China

Azer. Caspian

Mongolia

Sea

China

Japan
North
Korea

U b kiThis map is for illustrative purposes and is without prejudice to the status of or sovereignty over any territory covered by this map.

13

International Gas Prices
How can we reduce Asian Premium?
25

USD/MBtu

20

15

1050

Henry HubNBP

German border priceJapan LNG

Brent

Asian coal marker

IEA Mid Term Gas Market Review 201214

Post Fukushima Low Nuclear Case
IEA WEO 2011
GWFigure 12.3

Nuclear power capacity in the Low Nuclear Case
New Policies Scenario

700

Non‐OECD

600

OECD
500

Low Nuclear Case

400

Non‐OECD

300

OECD

200
1000
2010

2015

2020

2025

2030

2035

If no new nuclear plants be built in OECD countries,
Nuclear power will decline to 7% of total power generation in 2035.
15

Less nuclear means more ofeverything else + CO2
IEA WEO 2011

TWh• Power generation by fuel in the New Policies Scenario
and Low Nuclear Case
14 0002009

12 0002035:
New Policies Scenario

10 0002035:
Low Nuclear Case

8 000
6 000
4 000
2 000
0Nuclear•CoalGasRenewables

The biggest chunk of the lost nuclear generation is replaced by power generation from gasand coal, leading to a 6% or 0.9 GT increase in CO2 emissions in the power sector
16Additional $90 billion is needed to importgas and coal.
Global primary coal and gas demand and annual spendingon imports in the Low Nuclear Case

5 000

750

4 000

600

3 000

450

2 0003001 000

150Billion dollars (2010)

Mtoe

Figure 12.5

20092035:
New Policies
Scenario2035:
Low Nuclear
Case00Coal
demandGas
demandSpending on coal
imports

Spending on gas
imports

Note: Calculated as the value of net imports at prevailing average international prices.
17

twh

Germany may need much more Gas to phaseout Nuclear by 2022

Germany needs to import 16 BCM of gas to achieve electricity mix with 10%
demand reduction, no nuclear, 35% renewables and CO2 at the target level
18Power Grid Connection in Europe
Physical energy flows between European countries, 2008 (GWh)

Source: ENTSO-E

19

Innovative Energy & Environment Strategy
Decision by the Energy & Environment Council , GOJ
September 14th, 2012

• Mobilize all possible resources to phase out Nuclear
Power Generation during 2030s.
– Strict 40 years life of reactors. Restart reactors withapproval by the new NRC. No new construction.

• Green Energy Revolution– 10% Power saving and 19% energy efficiency by 2030.
– Triple Renewables by 2030. （ x8 excluding hydro）– R&D for new generation vehicles, Hydrogen system, CCS.

• Expand LNG gas power, Combined Heat & Power.
• Reform of power market.
• Flexible review of the decision.
20

Power grid in Japan
CoalGeneratingcompany

NuclearOil
OtherPower utility company

In‐housegeneration

HydroGas

Hokkaido

Tohoku60 hz <------Chugoku

Kansai

Hokuriku

TokyoKyushu
29GW

Okinawa
2GW

Shikoku
12GW
Chubu
40GW

--- 50 hz

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

21

Not only Feed‐in‐tariffs but Grid integration !
Snapshot of present penetration potentials“Harnessing Variable Renewables” by IEA

22

Lessons of the Fukushima•

Lessons to be Shared– Think about the unthinkable; Tsunami and Station Black Out. Large scale Blackout.
Change total mind set for “Safety”.
– Prepare for the severe accidents by defense in depth, common cause failure &compound disasters.
– Clarify why it happened only to Fukushima Daiichi and NOT to Fukushima Daini,
Onagawa nor Tokai daini.

•Safety Principles– Fukushima accident was caused by human error and should have been avoided. (Mr.
Hatamura, Parliament Investigation Commission report )– International Cooperation : A nuclear accident anywhere is an accident everywhere.
– Independent Regulatory authority ; Transparency and Trust, “Back Fitting” ofregulation•

Secured supply of Electricity– Power station location– Strengthened interconnection of grid lines•

Once disaster has happened, Recovery from disaster is at least as important as
preparing for it.
– FEMA like organization and training of the nuclear emergency staff including the self
defense force ; integration of safety and security.

– New Technology. New type of Reactors.

23450 ppm Scenmario : what we need and where .
GtFigure 6.2

W orld energy-related CO2 emissions by scenario2

4540

IEA WEO 2011

28%

OECD
Current Policies
Scenario

Non‐OECD

35

7 Gt

71%
New Policies
Scenario

33%

30

15 Gt
65%

450 Scenario
2520
1990

2000

2010

2020

2030

2035

Note: There is also some abatement of inter‐regional (bunker) emissions which, at less than 2% of the diﬀerence between
scenarios, is not visible in the 2035 shares.

GtFigure 6.4

W orld energy-related CO2 emissions abatement in the450 Scenario relative to the New Policies Scenario

38Abatement

New Policies Scenario

3634

2020

2035

Efficiency

72%

44%

32

Renewables

17%

21%

30

Biofuels

2%

4%

28

Nuclear

5%

9%

26

CCS

3%

22%

Total (Gt CO2)

2.5

14.8

24450 Scenario

22202010

2015

2020

2025

2030

2035

24

Sustainability helps Energy Security
Billion dollars (2010)

Figure 6.11

Oil-import bills in selected regions by scenario

600

2010

500

2035: New Policies
Scenario

4002035: 450 Scenario

300
200
1000Japan

United States

India

European Union

China

IEA WEO 201125

What is Energy Security in the
21st Century?

26Diversity means Energy Security .
”Safety and certainty in oil lie in variety and variety alone.” ( Churchill )Energy Self -Sufficiency rates by fuels in 2010

Self sufficiency=inland production / tpes
(2010 estimates)

IEA

Nuclear is an important option for countries with limited indigenous energy resources .
27North American Gas Infrastructure

Mid-Term Oil & Gas Market 2010, IEA

28

現Gas Infra in Europe: New Pipelines and LNG ports.
在ロシア以外からのパイプライン
ロシアからのパイプライン
ＬＮＧ基地（1999年までに運開）
ＬＮＧ基地（2000年以降運開）

画ＬＮＧ基地（建設中・計 中）

29

Gas Pipeline system in Japan is very weak.
IEA Japan review 2008

30

ASEAN is working on Gas Pipeline System.
Figure 15.16

The Trans-ASEAN Gas Pipeline (TAGP)
Existing gas pipeline
CHINA

INDIA

Planned or under construction gas pipeline
Gas production area
LNG liquifaction plant

Hanoi

MYANMAR

Planned LNG liquifaction plant

LAOS
Vientiane
YangonPlanned LNG regasification terminal
Luzon

THAILAND

Map Ta Phut

Bangkok

CAMBODIA
Phnom Penh
Ho Chi Minh

Mariveles
LNG (Baatan)

VIETNAM

Krabi

Medan

Mindanao
LubuanLumut
BRUNEIM A L A Y S I ABandar Seri
NatunaKuala Lumpur
Begawan
SINGAPORE
Dumai
Bintulu MLNG
Jurong Isl.
Bontang
Kalimantan
Sungiasalak
SumatraSenipah
Plaju

West JavaKm
0500

PHILIPPINES

PalawanKhanomArun

ManilaJakarta

JavaIN

Surabaya
Pasuruan

DBali
LombokSumbawa

East Java

TangguhSulawesi
O
N

E

FloresSSeramEAST TIMOR
DiliI

A

Papua

MaselaThe boundaries and names shown and the designations used on maps included in this publication do not imply official endorsement or acceptance by the IEA.

Source: ASCOPE Secretariat

31

New concepts for North East Asia Gas & Pipeline Infrastructure

32

ASEAN is working on Power Grid Interconnections.

33

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

Source: DESRETEC Foundation

34

Energy for Peace in Asia. A New Asian Vision?
Demand Leveling (Time Zone & Climate Difference)
Stable Supply (through regional interdependence)
Fair Electricity Price
Vladivostok
Vladivostok
Gobi
GobiDesert
DesertBeijing
BeijingChengduChengdu
Delhi
Delhi

BhutanBhutanHong
HongKong
Kong

Bangkok
Bangkok

MumbaiMumbaiTokyoTokyo
Shanghai
Shanghai

Dacca
Dacca

Kuala
KualaLumpur
LumpurSingapore
Singapore

Phase 3SeoulSeoul

TaipeiTaipei
ManilaManilaAsia
Super GridTotal 36,000km

Presentation by Mr. Masayoshi SON35Technology helps! Hydrogen Community with MCH•••

Large volume Hydrogen transportation & storage technology will be essential to build ‘Hydrogen Community’.
‘Hydrogen Community’ realizes Low Emission Carbon Recycling Society, with empowered resistance against disasters.
New path toward the Hydrogen Society will enhance innovation and create New Industries.
・CO2 Recycle( CO2 + H2→CO+H2O)

Energy Sector

Renewable Energy (Global)

Industrial Sector

City Gas
・H2 Mixture

Green Hydrogen

Power Storage(Renewable Sources)

Petroleum

ChemicalPower Gen.

・Heat Recycle

・Desulfurization
・Cracking・Feedstock

MCH・Elec. Stabilizer
・Stand‐by for Emergency

Clean Hydrogen(Hydrocarbon Sources)

Steel・Pure H2/ Mixed Fuel・Fuel Cell

・H2 Reduction

Logistics Sector
MCH・Petro/Chem. By‐product
・SRM with EOR/CCS
・Gasification

Port Facility

Hydrogen Supply(Dehydrogenation)

Logistics
MCH

MCH
MCH

MCH

・FC forklift
・H2mixed Fuel GHP
MCHStrategic Energy Reserve

Train(Large volume)

Hydrogen / H2‐CNG
Fueling StationBus・Fuel Cell Train
・H2 mixed fuel EngineSolar

Residential Sector

Wind

Renewable Energy(Local)
MCHHydrogen・FC /Engines

Tanker / Ferry
MCH・Fuel Cell Ship
・Hydrogen mixed fuel Engine

Truck・FCV・H2‐CNG Engine

・FCV・H2‐CNG Engine

MCH

Distributed
Power Gen.

House / Condominium
MCH

・Fuel Cells
・H2 mixed fuel Engine

Office & Commercial Sector

Car・FCV・CNG mixed engine

Heat

MCH

MCH・Heat Recycle

Office & Commercial
Building
MCH

Distributed
Power Gen.
・Cogeneration・Backup Power・Energy Storage

MCH

DHC・Boiler / Chiller(Pure H2/mixed)

Electricity(Note) MCH : Methylcyclohexane FC : Fuel Cell FCV : Fuel Cell Vehicle GHP : Gas Heat Pump DHC : District Heating and Cooling36

Technology helps. Case of Smart Grid

“ Yes in My Front Yard ”

Source: Cities, Towns and Renewable Energy, IEA (2009)37

Integral Fast Reactor and Pyroprocessing
Dr. YOON IL CHANG
Argonne National Laboratory

IFR has features as Inexhaustible Energy Supply ,Inherent Passive Safety ,Long-term Waste
Management Solution , Proliferation-Resistance , Economic Fuel Cycle Closure.
38

$39 Trillion and more Investment is neededfor energy Infrastructure.
Figure 2.21

Cumulative investment in energy-supply infrastructure byregion in the New Policies Scenario, 2011-2035
Power

Other E. Europe/Eurasia
OECD Asia Oceania
India
Middle EastRussia
Other Asia
La n AmericaAfrica
OECD EuropeChina
OECD Americas

OilGasCoalBiofuels

IEA WEO 2011

01

2

3

4

5

67
8Trillion dollars (2010)39

One cannot enhance energy security
by risking someone else‘s.
-Lesson of the Quake and Tsunami : Think about the unthinkable.
-Energy Security for the 21st Century must be Comprehensive Electricity Supply
Security under sustainability constraints.
-EU Model of Collective Energy Security be applied to the growing Asia. Develop
Regional Power Grid interconnection & Gas Pipelines including Russia.
-Innovation in Power supply: Efficiency, Decentralized Renewables, EVs, Smart
Grids, Storage, etc.
-Develop gas resources and infrastructure. Diversify supply and demand. Russia
remains as a key player.
-For coal to remain the backbone of power supply, CCS readiness & highly efficient
power plants are needed.
-Nuclear Power will continue to play a major role in the world. Japan’s role after
Fukushima is to share the lessons learned for safer Nuclear Power deployment inAsia and elsewhere. Develop safer and more proliferation-free reactor models, e.g.
Integral Fast Reactor as the 4G or Modular.
-New technologies help; hydrogen economy, Methane-hydrate , Super-conductivity
grid.
40