About the Japan LP Gas Association

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Contents
1. Global and National Energy Supply &Demand
2. Environment Surrounding the LP Gas
Industry in Japan
3. Future Initiatives of the LP Gas Industry

Chapter 1
Global and National Energy Supply & Demand1-1 LP Gas Demand in Japan (FY1993-2015)
Unit: K tons

20,00019,703K tons
14,390K tons

18,00016,00014,00012,00010,000Power Generation

8,000

Chemical

6,000City Gas

4,000

Automobive
Industrial

2,000

Residentail & Commercial

0Source: Japan LP Gas Association

 The demand for LP Gas peaked in FY1996 and has been on a gradual downwardtrend since then.
A continuous decline was observed in FY2015 as well.
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1-2 LP Gas Supply Patterns in Japan
Total

18,145

17,061

15,381

Source: Japan LP Gas Association “Monthly Demand-Supply Report”

15,2762

14,105

14,053(K tons)

1-3 LP Gas import volumes of Japan by Country (Propane + Butane Total)
Total

13,43913,424

11,574

Source: Japan LP Gas Association “Monthly Demand-Supply Report”

11,605

310,696

10,521(千トン)1-4 Enhancement of Supply Sources Diversification and Freight Cost The start of commercial operations through the expanded Panama Canal and explorationfor new sources of supply in the Pacific-rim regions

Arabian GulfCountries(Approx. 20 Days)

CanadaUS West Coast(Approx. 12 Days)

作業中

Houston(Approx.
28 Days)Panama Canal expansion reduces thetravel time (between Houston andJapan) from 45 to 28 days

Western Australia(Approx. 11 Days)

East Timor(Approx. 9 Days)

South Australia(Approx. 14 Days)

4Pictures (above and bottom) show a Very Large
Gas Carrier (VLGC) destined for Japan passing
through the new Panama Canal on June 27,2016.

1-5 Price Trends of LP Gas Produced in the Middle East vs. U.S. (arrival bases in Japan)

Middle East Prices(CP + Spot Freight)

U.S. Prices（ Mont Belvieu＋ Spot Freight ＋Terminal Fees）

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1-6 Price Trends of Crude Oil and Propane (on annual average value）
($/T)
1,000

Arabian Light (calorific propane equivalent value)
900

800

Saudi Arabia CP

700

600

500

400

300
2009年

2010

2011

2012

2013

62014

2015

2016

1-7 Price Trends of Crude Oil and Propane (on annual average value）(%)
115

Saudi Arabia CP

110

105

Arabian Light (calorific propane equivalent value)
100

95(Indexed at crude oil = 100)
90
2009年

2010

2011

2012

2013

72014

2015

2016

1-8 Trends and Projections of Global LP Gas Production/Demand
Global LPG Demand

Million Mt

Million barrels/dayGlobal LPG Production

Source: IHS

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1-9 Trends and Projections of LP Gas Export Volumes of Major
Exporting Countries
Global LPG Export Volumes of Major Exporting Countries
RussiaMillion Mt

Million barrels/day

Nigeria
Algeria
North Sea
United States
Qatar
Abu Dhabi
Saudi Arabia

Source: IHS

9Chapter 2
Environment Surrounding the LP
Gas Industry in Japan

2-1 “Long-term Energy Supply and Demand Outlook” prepared by METIEnergy DemandPrimary Energy Supply

Total

Total

361(million kl)

Around 326 (million kl)

542 (million kl)

Around 489 (million kl)

Renewable
8%energyCut around 50.3 million kl
by energy efficiency
and saving

Natural Gas Renewableenergy24%
CoalElectric power

25%
Heat
Gasoline
City Gas,
etc.

75%
FY2013(Actual)Electric power

25%

Around28%

LP Gas 3%

Heat
Gasoline
City Gas,
etc.

Oil
41%

Around72%

FY2030FY2013(After energy conservation measures)

Nuclearpower

Around13-14%
Around11-10%
Natural Gas

Self-efficiencyrate
Around 24.3%

Around18%

Coal
Around25%

LP Gas Around 3%

OilAround30%

FY2030Source: METI, “Long-term Energy Supply and Demand Outlook July 2015”10

2-2 Trend in Domestic LP Gas Demand and the FY2030 Target set by the
JLPGA’s “Mid- to Long-term Outlook”
Total

18,401

15,033

14,22919,700(K tons)

Source:[FY2005,2014-2015] METI, “Petroleum Products Demand Outlook Committee,
Liquefied Petroleum Gas WG[FY2030] Japan LP Gas Association “Mid- to Long-term Outlook”

112-3 Initiatives for Creating LP Gas Demand by Sector
ResidentialDemand: 5,100K tons
CO2 Reduction: 6,370K tons

Energy-efficient
hot water heater
Target: 16,000K units

CommercialIndustrial
Demand: 6,200K tons

Transportation
Demand: 1,300K tons

Demand: 2,200K tons

CO2 Reduction: 2,630K tons

GHP

Fuel conversion

LPG vehicles

Target: 1,200K kW equivalent

Target: 1,580K tons

Target: 560K cars

Home-use fuelcell system

CO2 Reduction: 1,320K tons

JPN-TAXI

Target: 1,500K units

Co-generation systems, etc.
Target: 1,600K kW equivalent

FRP cylinder
Dual-fuel trucks

Promotion of use

Source: Japan LP Gas Association “Mid- to Long-Term Outlook” second
revision, November 201512LP Gas Total Demand: 19,700K tons
CO2Reduction: 10,700K tons

2-4 Promotions of Bulk Storage Tanks Instrations
A system that facilitates the efficient supply of LP Gas to public facilities
and housing complex areas
LPG Bulk Lorry
Horizontal Bulk Storage Tank

Vertical Bulk Storage Tank

Above-ground Bulk
Storage Tank

* Both tanks have a storage capability of 990 kg■Inclusion in the Standard Specification for Public Works Construction
Since March of last year, the installation of bulk storage tanks has become one of the standard
specifications for public works construction defined by the MLIT, which is expected to lead to furtherusage.

■Promotion of regular use of LP Gas in public facilities and areas covered by city
gas networks so that they can serve as a “last resort” in case of emergency
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2-5 New Possibility of Domestic LP Gas-fueled Vehicles■LP Gas-monofueled Hybrid Vehicles

The Emergence of Next-generation Taxi

■Comparison of Fuel Economy (km/l)
NextgenerationVehicles

17.8

LastgenerationVehicles

0JAPAN TAXI (TOYOTA)
Coming in 2017
■Special Taxation Measures
Relevant tax
Eco-car Tax BreakAutomobile GreenTax Scheme

8.95101520（km/L）

Overview of Measures

Automobile weight tax

A full exemption from the tax imposed at the timeof the initial inspection of newly acquired
automobiles

Automobile acquisition tax

A full exemption from the tax on the acquisition ofautomobiles

Automobile tax

Approx. 50% reduction in the annual automobiletax

142-6 LP Gas Industry’s Responses to the “Kumamoto Earthquake”■ April 14 (Thu) 21:26 JST, M 6.5 Earthquake with a seismic intensity of 7 occurred in KumamotoEmergent safety check of the areas affected by the earthquake, including the LP Gas
supply facilities in accordance with the agreement between JLPGA’s member companies(Mutual Assistance Agreement)■ April 16 (Sat) 1:25 JST, M7.3 Earthquake with a seismic intensity of upper 6 occurred inKumamoto
9:29 JST

The Minister of METI declared a “Recommendation for implementation ofcooperative action in LPG supply during a disaster”
 Participant companies across Chugoku, Shikoku and Kyushu Districts<Industry’s Responses>

Deployment of generator-mounted vehicle owned by the JLPGA’s member companies
Disaster relief activities by domestic LP Gas dealers of JLPGA’s member companies
Dispatch of the “Team LPG,” organized by members of the Kumamoto LPG
Association to Mashiki-Municipality
Safety check was completed on April 20 in Oita Prefecture and on April 25 inKumamoto Prefecture15

2-7 LP Gas Industry’s Responses to the “Kumamoto Earthquake”■ Dispatch of generator-mounted vehicle owned by JLPGA’s member companies*Source: Astomos Energy■ Disaster relief activities by LP Gas dealers(Reference) Kumamoto Castle after the earthquake*Source: Iwatani Corporation “MaruiGas Disaster Rescue Team”■ Kumamoto LPG Association “Team LPG”

*Source: Sekiyu-Kagaku-Shinbunsya “Propane-Butane News”

162-8 Promotion of the Installation of a Bulk Supply System for Emergency & Disaster■ Encouragement of user-side stockpiles by making use of the Government’s
Subsidy Programs

Bulk Storage

Intelligent Gas Meter
Model-SB

Low Pressure Hose
Coupling Connectors
Guard Pipe
BaseStorage Box■ Installation Location

Hospital 9％■ Subsidy Delivered (FY2012-2015)

School 3％

Others/PrivateOrganization
37％

Gas Service
Providers15％

Social Welfare
Facilities 28％

Approx. 300 units

Total Subsidy

Approx. 1.2 billion yen■ Subsidy Program for FY2017

PublicOrganization 9％

Source: Conference of LP Gas Associated Organizations “Subsidy projects” 2012-2015

No. ofInstallations

17Location

Hospital, Nursing home,
Public/Temporary evacuation shelter, etc.

Budget

600 million yen

Subsidy
Rate

1. Private sector: 2/3
2. Public sector (e.g. Local government): 1/2

2-9 Promotion of the Installation of a Bulk Supply System in Preparation for Disaster[e.g.] School Kitchen
Multilevel Rice Cooker
Cooking Stove

Fryer

Coverage of Subsidy Programs

Bulk Supply System for
Emergency & DisasterRotary Cooking Pot

ElectricPower[e.g.] School PA System

Cooking Stove or Electric Generator(Emergency Announcement for Students or Evacuees)

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2-10 Supply-side Resiliency Measures

Core Filling Stations
344 stations across the nation

Generator-mounted vehicle
Kawasaki･Nanao･Yokkaichi･
Fukushima

Nanao

Fukushima

Kawasaki
Yokkaichi

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Chapter 3
Future Initiatives of the LP Gas Industry

Energy Deregulation in Japan
Creation of a Comprehensive Energy Market
Electricity Market

Current Demand (no. of households)

City Gas Market

Regional monopolyFY2016

Deregulation in
Retail Market

FY2017
FY2020
FY2022

Deregulation in
Retail Market

TotalHouseholds

53 million*All-electrified

6 million

City Gas

25 million

LP Gas24 million*Includes households that use multiple energies.
Source: Japan LP Gas Association “LP Gas
Statistics of Japan” 2016; Fuji Keizai “Energy
market forecast 2016 by type of energy, service,relevant device, area”

Non-energy Industries

Separation of the powertransmission/distribution sector

・IT Industry
・Automobile Industry, etc.
Separation of gas pipelinecompanies and gasretailers＜＜＜ Removal of barriers between markets ＞＞＞
Full-scale inter-energy competition
further intensified by new entrants from
non-energy industries

20Future Initiatives of the LP Gas Industry

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