ENERGY POLICIES

Germany Poland China Turkey Algeria - Brasil

Copyright: Artur Wyrma

Quick outlook & comparison

Before giving the detail results for each country it is helpful to provide some information

how these countries are developing economically. It is also important to compare what is

the average standard of living. Those questions can be partly answered by the graph

below which compares the electricity consumption and GDP per one habitant. To

illustrate the development process and changes that had taken place the Evolution over

1980-2000 of these two parameters has been presented.

Figure 1. Evolution over 1980-2000 of the Electric consumption per capita linked with GDP per capita

PPP (* for Poland evolution covers the period from 1990-2000).

The European Union Countries i.e. Germany and Poland have the biggest value of GDP

per capita and they also consume the most electricity per capita. It means that the

standard of living of average person is higher than in other countries. Poland has

significantly increased GDP (*in 10 years) with not so significant grow of electricity

consumption. Also Turkey and especially China have significantly improved the GDP

during analyzed 20 years period. This development was linked with to lower increase in

electricity use per capita for China. In case of Brazil one can noticed the relatively high

increase in electricity consumption but little growth in GDP per caita. Algeria seems to

be in worse situation as the electricity consumption has been increased while GDP per

capita went down. There are also very big differences in primary energy mix to produce

electricity in these countries. Before looking far in the past let us present the situation in

2000. Some countries are more dependent on one main energy source i.e. Algeria (natural

gas), Brazil (hydro), China and Poland (coal).

Algeria Brazil

China Poland

Germany Turkey

The others like Germany and Turkey have more differentiated mix of primary energies

they use to generate electricity. The information mentioned above are helpful to better

understand the energy policies and decisions on energy development that have been made

by Governments.

Brazil

Brazil is the 10th largest energy consumer in the world and the third largest in the

Western Hemisphere, behind the United States and Canada. Total primary energy

consumption in Brazil has increased significantly in recent years. In addition, Brazil has

made great strides in increasing its total energy production, particularly oil, over the past

decade. Increasing domestic oil production has been a long-term goal of the Brazilian

government.

In time of first oil shock in 1973, Brazil was net importer of ca. 30 Mtoe. In 1975

regulation was introduced to blend to gasoline 10% of ethanol. The ethanol production

from sugar cane has started. This level was steadily raised to 25% over the next five

years. Very favorable conditions for new sugar industry were established (e.g. tax

exemptions, soft loans After the world's second oil-price shock, a Proalcool program (In

Brazil, ethanol is called "alcool") was started to even sped up the efforts towards ethanol.

As a result, oil imports started to decline as presented in the figure below:

R1-Brazil-Net oil imports/ net energy imports

0%

20%

40%

60%

80%

100%

120%

140%

1965 1970 1975 1980 1985 1990 1995 2000

ratio

0

10

20

30

40

50

60

[Mtoe]

Brazil-Net oil imports/ net energy imports Oil import

Figure 2. Ratio of Brazil net oil imports to net energy imports. Source: BP Statistical Review 2007

The policy of supporting ethanol production from sugar cane has been continued. As a

result Brazil decreased significantly it oil dependency and is close to become oil

independent.

In seventies Brazil decreased its energy consumption and improve energy intensity factor.

During eighties and early nineties the energy intensity remained almost constant (there

were some fluctuations). However, since 1995 the energy intensity started to increase

rapidly as the energy consumption has grown faster than GDP what is presented in the

figure below:

R2-Brazil-Energy consumption /GDP

125

130

135

140

145

150

155

1965 1970 1975 1980 1985 1990 1995 2000

ratio [TOE / M$]

0,E+00

2,E+05

4,E+05

6,E+05

8,E+05

1,E+06

1,E+06

1,E+06

2,E+06

[GDP constant 2000 PPP]

Brazil-Energy consumption/ GDP GDP

Figure 3. Ratio of energy consumption to GDP. Source: World Development Indicators 2007

In seventies net energy imports (mainly oil) constituted more than 30 % of Brazil energy

consumption. Because of the strategic development of ethanol economy this ration has

been changed and at the beginning of 21 century the ratio decline down to 10%.

R3-Brazil-Net energy imports / energy consumption

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

1966 1971 1976 1981 1986 1991 1996 2001 2006

ratio

Brazil-Net energy imports / energy consumption

Figure 4. Ratio of net energy imports to energy conumption. Source: BP Statistical Review 2007

The figure below shows how successful has been the development program of ethanol

production. The country has switched from big oil importer to almost being oil

independent. The economy is not any longer dependent on foreign oil supply.

R4-Brazil-Net oil imports /GDP

0

10

20

30

40

50

60

70

1966 1971 1976 1981 1986 1991 1996 2001 2006

ratio (TOE/M$)

Brazil-Net oil imports /GDP

Figure 5. Ratio of net oil imports to GDP. Source: BP Statistical Review 2007

The use of bioethanol enable Brazil to maintain the CO2 intensity at the almost stable

level.

R5-Brazil-CO2 emissions/ energy consumption

0,00

0,20

0,40

0,60

0,80

1,00

1,20

1,40

1,60

1,80

1966 1971 1976 1981 1986 1991 1996 2001 2006

ratio (tCO2 /toe)

Brazil-CO2 emissions/ energy consumption

Figure 6. Ratio of CO2 emissions to energy consumption. Source: BP Statistical Review 2007

It is worth to note that CO2 intensity is almost 2 times lower than e.g. for Poland.

The example of Brazil shows that development of bioethanol economy can be a

successful strategy in terms of security of supply and energy independency. Also CO2

intensity stays in this case at almost constant level. However, one should not forget about

huge environmental consequences caused by transformation of Brazylian forests into

sugar cane plantations and losses in biodiversity. Because of the large scale of

irreversible changes in ecosystems it remains questionable whether such development ,

despite of all advantages, meets the sustainable energy development criteria.

POLAND

Polish primary energy mix differs from those of its European counterparts. Poland has

total hard coal reserves of close to 30 000 million tonnes, of which around 4000 million

tonnes are operational at present. That is why domestic solid fuels constitute 65 percent

of primary energy. Poland is close to be 100 percent selfsufficient from an electricity

production point of view, but also intensive in emissions of carbon and of other

traditional pollutants such as SOx, NOx and dust.

Poland has based on coal since a long time. The rich coal deposits were known the since

15th16th century. Because of this context during the time of first oil shock in 1973,

Poland was not so much affected (it was still exporting coal to other countries) as

presented in the figure below:.

R1-Poland-Net oil imports/ net energy imports

-2000%

-1000%

0%

1000%

2000%

3000%

4000%

5000%

1970 1975 1980 1985 1990 1995 2000

ratio

0

5

10

15

20

25

[Mtoe]

Polandl-Net oil imports/ net energy imports Solid Fuel Exports

Figure 7. Ratio of Polish net oil imports to net energy imports (on the right). Source: BP Statistical Review

2007. Solid fuel exports (on the right). Source: DG TREN 2006.

The fluctuations on the figure can be explained as follows: Polands oil and natural

imports where in the past 30 years at the very close level to the hard coal exports. Oil

imports has been steadily increasing from over 11 Mtoe in 1973 up to almost 20 Mtoe in

2004. Up to 1981 Poland was net energy exporter. Then in 1981 the solidarity

movements has started and because of this the war state was introduced. Many miners

went on strike and coal production was dropped (we can observed the first peak on the

figure presenting the ratio of Polish net oil imports to net energy imports. In few years the

strikes were finished and again the coal was produced in big amounts. However, in late

eighties Poland started to introduced reforms to decrease coal mining (one can observe

the peak on the figure again). After that period the fluctuations are caused by changes in

solid fuel exports as a consequence of weather conditions (solid fuels exports, notably,

hard coal are marked with red dashed line on the Figure above). .

After transition of Polish system from communism to open economy the heavy industry

started to collapse. Naturally, new low energy intensive sectors have started to grow and

contribute to the increase of GDP. It resulted in the constant decrease of energy intensity.

R2-Poland-Energy consumption /GDP

0,00

50,00

100,00

150,00

200,00

250,00

300,00

350,00

400,00

1988 1990 1992 1994 1996 1998 2000 2002 2004 2006

ratio (TOE / M$)

Poland-Energy consumption /GDP

Figure 8. Polands energy intensity.

Gas and oil imports have been steadily increasing since seventies. Both fuels are mainly

imported (recently the ambitious program has been lunched to increase domestic

production). In eighties Poland has started to developed the natural gas pipe system for

individual space heating systems. Currently, gas pipes are located almost in each village.

As mentioned above oil consumption has increased mainly due to development of

transport sectors. In parallel, because of transition of Polands economy, primary energy

consumption started to decrease. This can be illustrated by the Figure below:

R3-Poland-Net energy imports / energy consumption

-20%

-15%

-10%

-5%

0%

5%

10%

15%

20%

1966 1971 1976 1981 1986 1991 1996 2001 2006

ratio

Poland-Net energy imports / energy consumption

Figure 9. Ratio of net energy imports to energy consumption. Source: BP Statistical Review 2007

Poland has been developing very since nineties. Just for illustration in 2006, GDP grew at

a rate of 5.3%, and in the first quarter of 2007 it expanded 7.4 percent. This

notwithstanding the ratio of net oil imports to GDP has remained at plateau during this

time (slight decrease can be observed). As presented in the Figure below It was possible

to decouple increase of economy from oil consumption.

R4-Poland-Net oil imports /GDP

0,00

10,00

20,00

30,00

40,00

50,00

60,00

1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006

ratio (TOE/M$)

Poland-Net oil imports /GDP

Figure 10. Ratio of net oil imports to GDP. Source: BP Statistical Review 2007

Finally, mainly due to improvements of energy conversion efficiency after 1980 also

CO2 intensity has decreased. One could observe the slight increase of CO2 intensity in

2003. Perhaps the energy sector has nearly reached the potential for efficiency

improvements with the existing generation fleet. On the other hand, one could expect that

due to enhancing of co-firing of biomass with coal, the decreasing trend was kept in the

following years.

R5-Poland-CO2 emissions/ energy consumption

3,25

3,30

3,35

3,40

3,45

3,50

3,55

3,60

3,65

3,70

3,75

1966 1971 1976 1981 1986 1991 1996 2001 2006

ratio (tCO2 /toe)

Poland-CO2 emissions/ energy consumption

Figure 11. Ratio of CO2 emissions to energy consumption. Source: BP Statistical Review 2007

The example of Poland shows that its strategy in terms of security of supply and energy

independency is to make use of the domestic fossil fuel. This made the country not so

much affected by oil crises. Big improvements has been made of conversion efficiency

from primary to secondary energy. It is worth to mention that the centralized heat and

power sector of Poland is one of the most efficient in EU thanks to large use of cogeneration.

This notwithstanding, the main fuels used are hard and brown coal. These are fossil,

exhaustible fuels having a strong impact on global warming. Partial solution may be to

replace the old generation fleet with new highly efficient coal technologies with carbon

capture and sequestration.

0,00

1 000,00

2 000,00

3 000,00

4 000,00

5 000,00

6 000,00

7 000,00

8 000,00

0,00 5 000,00 10 000,00 15 000,00 20 000,00 25 000,00 30 000,00

GDP per capita, PPP (constant 2000 international $)

Electric power consumption (kWh per capita)