Asia Pacific Energy Research Centre

APEC Energy Demand and Supply Outlook, 6th Edition

Cecilia TamSpecial Advisor, APERC

2APERC Asia Pacific Energy Research Centre

Business as Usual (BAU)

Scenario

3APERC Asia Pacific Energy Research Centre

Outlook for APEC Energy Demand

Final energy demand rises 32% from 2013 level by 2040. APEC’s energy intensity

reduction target of 45% cannot be met by 2035 in the BAU scenario.

Final energy demand in APEC region

-60

-50

-40

-30

-20

-10

0

0

1 000

2 000

3 000

4 000

5 000

6 000

7 000

8 000

2013 2020 2030 2040

En

erg

y i

nte

nsi

ty i

nd

ex

Mto

e

Agricultural and non-

specifiedCommercial

Residential

Transport

Industry

Non-energy

Energy intensity index

(right axis)

4APERC Asia Pacific Energy Research Centre

0

2 000

4 000

6 000

8 000

10 000

12 000

1990 2000 2010 2020 2030 2040

Mto

e

Nuclear

Other

renewables

Hydro

Gas

Oil

Coal

Fossil-Fuels Continue to Dominate Energy Mix

Energy supply in APEC region will more than double by

2040 from 1990 level.

Growth Rate 2013-2040

0.4%

0.7%

2.1%

2.3%

1.3%

1.3%

2013: 86%

Fossil Fuel

2040: 82%

Fossil Fuel

Total primary energy supply by fuel, 1990 - 2040

5APERC Asia Pacific Energy Research Centre

5%

33%

27%1%

14%

20%Nuclear

Coal

Gas

Oil

Hydro

Other

renewables

Outlook for Power Sector

RE capacity expand to 34% by 2040, but fossil fuels dominate generation due to

relatively lower RE capacity factors. Doubling not achieved by 2030 nor 2040 in BAU

APEC installed capacity

Note: Other renewables include solar PV, CSP, onshore wind, offshore wind, biomass, geothermal and marine.

APEC electricity generation

2013 Capacity:

3 564GW

2040 Capacity:

6 415GW

0%

20%

40%

60%

80%

100%

0

5 000

10 000

15 000

20 000

25 000

1990 2000 2013 2020 2030 2040

Sh

are

of

ren

ew

ab

les

TW

h

Other renewables

Hydro

Oil

Gas

Coal

Nuclear

Share of renewables

(right axis)

Doubling level of

renewables share in

generation mix (right axis)

→ Projection

6%

39%

24%

5%

18%

8%

6APERC Asia Pacific Energy Research Centre

Renewable Policies in APEC

Economy Renewables

Act

Other regulation or

master plan related

to renewables

Strategy for

renewables

development

Renewable share target of

electricity generation, %

Feed-in tariff (FiT), renewable

portfolio standard (RPS), tax

incentives

Australia √ √ √ 23.5% in 2020, over 30% by 2050 T

Brunei Darussalam - √ √ 10% by 2035 -

Canada - √ √ √* F/R*, T

Chile √ √ √20% non-conventional in 2025,

70% in 2050-

China √ √ √ 20% primary in 2030 F, T

Hong Kong - √ √ √ T

Indonesia - √ √ 232 Mtoe (247.4 GW) in 2050 F, T

Japan √ √ √ 22-24% in 2030 F, T

Korea √ √ √ (13.4%) in 2035 R, T

Malaysia √ √ √ 3% in 2020 F, T

Mexico √ √ √ (29.1%) in 2028 T

New Zealand - √ √ 90% in 2025 -

Papua New Guinea - - - 100% in 2050 -

Peru √ √ √ 60% (5%**) in 2020 -

The Philippines √ √ √ (+9.9 GW, +200%) in 2030 F, R, T

Russia - √ √ 4.5%** (25 GW**) in 2030 F

Singapore - √ √ - -

Chinese Taipei √ √ √ 12.6% (27.1%) in 2030 F, T

Thailand - √ √ 20% in 2036 F, T

United States - √ √ √* F/R*, T

Viet Nam - √ √ 6% in 2030 F

Note: √= existing; - = not existing currently; F = feed-in tariff; R = renewable portfolio standard; T = taxation incentive; * = applied in some local territories or states; ** = target excludes large-scale hydro; (…) corresponds to installed renewable capacity targets.

7APERC Asia Pacific Energy Research Centre

High Renewables Scenario

8APERC Asia Pacific Energy Research Centre

Estimated Potential of Renewable Energy

Note: This map is for illustrative purposes and is without prejudice to the status of or sovereignty over any territory covered by this map.

Note: Oceania (Australia, New Zealand and PNG), Other Americas (Canada, Chile, Mexico and Peru), Other North East Asia (Hong Kong, Japan, Korea

and Chinese Taipei), South East Asia (Brunei Barussalam, Indonesia, Malaysia, Philippines, Singapore, Thailand and Vietnam)

9APERC Asia Pacific Energy Research Centre

Costs of RE technologies (solar and wind) will continue to see further cost reduction

as deployment increases. Wide range of costs across APEC

Declining Electricity Cost from Renewables

10APERC Asia Pacific Energy Research Centre

Solar and Wind Growing at the Fastest Rates

Solar and Wind have the highest annual growth rates due to abundant untapped

economic potential, declining costs and government targets in some economies.

11APERC Asia Pacific Energy Research Centre

High Renewables Scenario

Renewables mix varies across APEC, solar and wind see largest growth

2013 BAU: 819 GW / 2 716 TWh

2030 HR: 2 510 GW / 7 109 TWh

2040 HR: 3 041 GW / 8 911 TWh

GW TWhChina

0

1 000

2 000

3 000

4 000

5 000

0

500

1 000

1 500

2 000

2 500

2013 2040 2013 2040

GW TWhUnited States

0

500

1 000

1 500

2 000

2 500

0

200

400

600

800

1 000

2013 2040 2013 2040

GW TWhOceania

0

50

100

150

200

250

300

0

20

40

60

80

100

120

2013 2040 2013 2040

GW TWhOther Americas

0

200

400

600

800

1 000

0

50

100

150

200

250

2013 2040 2013 2040

GW TWhOther north-east Asia

0

200

400

600

0

100

200

300

2013 2040 2013 2040

GW TWhSouth-East Asia

0

200

400

600

800

1 000

0

50

100

150

200

250

2013 2040 2013 2040

GW TWhRussia

0

100

200

300

400

500

600

0

20

40

60

80

100

120

2013 2040 2013 2040

Hydro

Wind

Solar

Biomass and other

Geothermal

12APERC Asia Pacific Energy Research Centre

<Variable Renewable Energy (VRE)

Integration>

• Most APEC economies can be

categorized as “Low Share”, except

for several economies such as

Australia and United States.

• According to IEA:

– “Low Share”, No a big technical

challenge to operate a power system

under categorized “Low Share”

(IEA,2015).

– “Large Share”, The system-wide

integration needs to be transforming

in order to increase flexibility.

Variable Renewable Integration

Note:• “Low Share” means that the share of VRE is 5-10% of

annual generation.• “High Share” means that the share of VRE is 20-45% of

annual generation.

Economy

2030 2040

Australia 42% 49%

Brunei Darussalam 8% 8%

Canada 8% 8%

Chile 21% 18%

China 12% 16%

Hong Kong, China 2% 2%

Indonesia 3% 12%

Japan 10% 12%

Korea 8% 10%

Malaysia 3% 3%

Mexico 8% 9%

New Zealand 21% 23%

Papua New Guinea 6% 4%

Peru 1% 1%

Philippines, the 7% 6%

Russia 2% 3%

Singapore 1% 1%

Chinese Taipei 9% 12%

Thailand 7% 6%

United States, the 21% 25%

Viet Nam 4% 7%

Share of variable renewables in total power generation

13APERC Asia Pacific Energy Research Centre

High Renewables in Transport

14APERC Asia Pacific Energy Research Centre

Biofuels in APEC

Bioethanol Biodiesel Bioethanol Biodiesel

Australia √ √* √* E4/E5* B2* √

Brunei Darussalam - - - - - -

Canada √ up to E8.5** up to B4** E5 B2 √

Chile - - - - - -

China - E10** - 10 Mt (2020) 2 Mt (2020) √

Hong Kong √ - - - - √

Indonesia √ E3 B10 E20 (2025) B30 (2025) √

Japan √ √ - Y

Korea √ - B2 - B5 (2020) √

Malaysia √ - B7 - B10 √

Mexico √ E2 - √ - √

New Zealand - - - - - -

Papua New Guinea - - - - - -

Peru √ - - E7.8 B5 √

The Philippines √ E10 B2 E20 (2020) B20 (2025) √

Russia √ - - - - -

Singapore - - - - - -

Chinese Taipei √ - - - - √

Thailand - - B7 4 billion L/yr 5 billion L/yr √

The United States √ up to E15** up to B10** √

Viet Nam √ E5 *** E10 (2017) - √

0.5 million Loe (2017)

RegulationBlend rate mandate Blend rate target Incentives,

subsidies

and taxation

136 billion L/yr (2022)**

Economy

15APERC Asia Pacific Energy Research Centre

Lack of Bioethanol Supply Potential

Almost all economies can increase biofuels use in the transport sector.

Advanced biofuel technologies needed, as higher supply potential based only on 1st

generation biofuels is insufficient to meet growing demand

0%

1%

2%

3%

4%

5%

6%

7%

8%

0

20

40

60

80

100

120

140

160

2010 2020 2030 2040 2010 2020 2030 2040

BAU High Renewables

Sh

are

of

bio

fuels

Mto

e

Biodiesel

demand

Bioethanol

demand

Biodiesel

supply

potential

Bioethanol

supply

potential

Share of

biofuels

(right axis)

16APERC Asia Pacific Energy Research Centre

Biofuels Demand and Supply Potential

US has largest bioethanol supply potential, while South-East Asia has highest

biodiesel supply potential.

APEC biofuels trade is a must in short and medium term

Bioethanol demand and supply potential Biodiesel demand and supply potential

17APERC Asia Pacific Energy Research Centre

40

50

60

70

80

90

100

110

120

130

140

1990 1995 2000 2005 2010 2015 2020 2025 2030 2035 2040

En

erg

y in

ten

sit

y in

dex (

20

05

base y

ear)

BAU Energy Intensity Index Alternative Energy Intensity Index

APEC’s target in 2035 can be met earlier under the Improved Efficiency Scenario

45% reduction target

20372032

Improved Efficiency Scenario

13% savings

921 Mtoe

18APERC Asia Pacific Energy Research Centre

Total CO2 Emissions in APERC Scenarios

Level of ambition of APEC energy targets need to be raised if global climate goal is to be achieved

19APERC Asia Pacific Energy Research Centre

<Renewable Power Generation>

• Continue to improve business environment for renewables development as “doing

business” in some APEC economies are still cumbersome.

• Strengthen and improve the economy’s electricity system to facilitate greater VRE

integration.

<Renewable Transport>

• For enhancing biofuels trade among APEC member economies:

– Implement the guidelines for the development of biodiesel standard in the APEC.

– Establish similar standard for bioethanol.

– Establish biofuels blend rate standard for vehicles which can meet the standard of

auto-manufactures.

• Introduce the development and deployment of advanced biofuels to promote greater

utilisation of biofuels.

Opportunities for Policy Action

20APERC Asia Pacific Energy Research Centre

Thank you for your attention!

APEC Energy Demand and Supply Outlook Release 11 May 2016

available for download from http://aperc.ieej.or.jp/