Updates on the Chinese Energy Sector

Updates on the Chinese Energy Sector

Yanjia Wang, Alun Gu, Aling Zhang

Tsinghua University, China

EASS Workshop

23rd September 2010, Beijing

Part A: Targets, Efforts and Results

WANG, Yanjia [email protected]

Part B: China LEAP Modeling Efforts

GU, Alun [email protected]

Targets

• National 11th Five-Year Plan(2006-2010): 20% reduction of energy intensity of GDP 10% reduction of pollutant emission

• National 12nd Five-Year Plan(2011-2015): may be another 20% EE

• Commitment to Copenhagen (2006-2020): 40-45% of reduction of carbon intensity of GDP

Efforts

• Adjust economic structure

• Improve energy efficiency

• Develop low-carbon energy resources

Energy Intensity of Value-added

EI (current price)calorific value

calculation coal equivalent

calculation

Primary 0.21 0.29

Secondary 1.58 1.50

Tertiary 0.45 0.60

EI (2005 constant price)calorific value

calculation coal equivalent

calculation

Primary 0.25 0.34

Secondary 1.74 1.65

Tertiary 0.50 0.67

Data before census

A Long Way To Go …

12. 2 11. 3 11. 1 11. 3

47. 7 48. 7 48. 5 48. 6

40. 1 40 40. 4 40. 1

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

2005 2006 2007 2008

Comp

osit

ion

of G

DP

Ter t i arySecondaryPr i mary

Source: China Statistical Yearbook 2009(measured by current price)

Achieve EE target heavily relay on structure changed, but..

Direct Input Coefficient of Input-Output Table(2005)

Input Output Primary Secondary Tertiary

Primary 0.37920 0.06904 0.03317

Secondary 0.45264 0.76709 0.56483

Tertiary 0.16816 0.16388 0.40201

Source: China Statistical Yearbook 2009

Infrastructure construction consumed more energy-intensive products

0

200

400

600

800

1000

1200

1400

2000 2001 2002 2003 2004 2005 2006 2007 2008

Steel (Mt )

Cement (Mt )

Ethyl ene (10, 000t )

Chemi cal Fert i l i zer(100, 000t )

Source: China Statistical Yearbook 2001--2009

Energy Efficiency in Power Generation Plants

Measures: shut down small plants(200MW), build SC, USC power plants (600MW, 1000MW per generator)

Average coal i nput f or thermal power generat i on (gce/ kWh)

319

316

392

300

310

320

330

340

350

360

370

380

390

400

Mandatory Standards to Energy-intensive Products • Published norms of energy consumption per unit

product in various industrial sectors (affected on June 1st 2008).

• Including three levels of EE: for existing plants, for new-built plants and for targeted plants.

• Covered crude steel, ferroalloy, coke, cement, ceramics, flat glass, caustic soda, calcium carbide, synthetic ammonia, yellow phosphorus, copper, zinc, lead, nickel, tin, magnesium, antimony copper and copper-alloy tube, wrought aluminum alloy extruded profiles for architecture, electrolyzed aluminum.

• More norms are under development.

Award Energy Saving Projects

• Central government: 300 yuan/tce (savings ≥10,000tce/a)

• Some provincial government: 200-300yuan/tce (10,000 ≤savings ≥thousands)

• A few city government: 100yuan/tce

Efforts in Transport Sector

• Build mass transit and inter-city rapid transit system

• Consumption tax reduction(5% to 2.5%) to compact cars and hybrid cars (2009)

• Fuel tax on petrol consumption (2009) • Subsidy vehicle buyers if old car eliminated

(2009)• Mandatory limitation of vehicle ages• Fuel economy standards

Improving fuel efficiency by 19%

• GB19578-2004 Limits of Fuel Consumption for Passenger Cars– Stage I: effected July 1st 2005 for new certified cars;

July 1st 2006 for current produced cars– Stage II: effected January 1st 2008 for new certified

cars; January 1st 2009 for current produced cars

• Covered 2374 types of vehicles and 95 manufacturers in stage II, 444 types of vehicles (produced by 55 manufacturers) are failure to meet the standard. The manufacturers had to stop producing these 444 types of vehicles.

Traffic Makes Real Fuel Consumption Much Higher than the Standards

Source: Jin Yuefu (2005)

EE in Building Sector

• Appliance standards and labels

• Design standards for new buildings (big progress)

• Retrofit existing buildings (no progress)

• Monitoring governmental buildings (trial stage)

Saving Targets: 30%, 50% & 66%

• Regional based

• Baseline: 1980’s standard

• 30% saving standard: 1986

• 50% saving standards: 1996

• 65% savings standards: under development, effected in some regions.

Space-heating Standard in Beijing

Standards Average space-heating load (W/m2)

Heating system efficiency (%) Energy intensity (W/m2)Boiler house Network System

1980 31.7 55 85 46.75 67.8

30% 25.3 60 90 54 46.9

50% 20.6 68 90 61.2 33.7

65% 11.1 68 90 61.2 23.7

Source: Kang Yanbin 2008

More Specific Requirements (Beijing)

Building type Resident Office Business Department store Hotel

Elec. Cons. (kWh/M2 a) 18 53 88 200 87

Air conditioning 8 18 30 110 46

Lighting -- 14 22 65 18

Appliances -- 20 32 10 14

Elevators -- -- 3 14 3

Water system -- 1 1 0.2 5.8

Cooling (GJ/ M2 a) 0.29 (8 kWh/M2 a) 0.15 0.28 0.48 0.32

Heat (GJ/ M2 a) 2.33

(65.kWh/M2 a)

0.20 0.18 0.12 0.30

Hot water(GJ/ M2 person) -- -- -- -- 12

Source: 2009 Annual Report of Energy Conservation of Buildings

Wind Power Development

Wi nd Power I nstal l at i on Capaci ty (GW)

0. 76412

20

86

0

20

40

60

80

100

2004 2008 2009 2020

Solar Power Development

PV I nstal l at i on Capaci ty (GW)

0. 07 0. 140. 3

2

0

0. 5

1

1. 5

2

2. 5

2005 2008 2009 2020

Installed Capacity of Power Generation (1980 – 2008)

65.9

166.5

277.3

391.4

792.5

0

100

200

300

400

500

600

700

800

900

1980 1992 1998 2003 2008

Gig

aw

att

s

Mix of Installed Capacity of Power Generation(2008)

Hydro, 21.6%

Nuclear, 1.1%

Thermal, 75.9%

Other, 1.4%

Results Vs. Target

1

1. 05

1. 1

1. 15

1. 2

1. 25

1. 3

2005 2006 2007 2008 2009 2010

Energy Intensity of GDP (tce/10k RMB)

After census

Build Baseline

Economic census of 2008 conducted in 2009.

Revised GDP and energy data.

GHG inventory of 2005 is under development.

General Published Data Source1. Statistical Communiqué: Published by National

Bureau of Statistics (NBS) in February of Year X+1, using statistical data of January to November Year X and the growth rate of December Year X-1 to estimate GDP and energy of Year X.

2. Yearbook: Published by NBS in autumn of Year X+1 to present GDP and energy of Year X.

3. National Economic Census: Leading by State Council and NBS. Published in January of Year X+1. Conducted in Year X to investigate data of Year X-1. Once in every 4 years.

GDP Data

• Communiqué 2008 estimated GDP of 2008 was 30.067 trillion RMB.

• Yearbook 2009 adopted the same number (30.067 trillion RMB).

• GDP of 2008 was adjusted to 31.4045 trillion RMB after census, increased 4.45%.

• Communiqué 2009 estimated GDP of 2009 was 33.5353 trillion RMB.

GDP Adjustment – Big difference in service sector

Before census

After census

Discrepancy

GDP 30067 31404.5 1337.5 4.45%

First Industry

3400 3370.2 -29.8 -0.88%

Second Industry

14618.3 14900.3 282 1.93%

Tertiary Industry

12048.7 13134.0 1085.3 9.01%

Regular statistical system (Yearbook) collects value-added data mainly from

designated size of organizations Designated size of organization:

– Mining, Manufacture, Elec. Gas, Water: All state-owned and non-state-owned enterprises with annual revenue from principle business ≥5 million RMB

– Construction: various types of ownership with qualification certification and independent accounting systems

– Wholesale: Sales ≥20 million RMB; Employer (year-end)>20

– Retail: Sales ≥5 million RMB; Employer (year-end)>60– Hotel: rating stars– Catering: Sales ≥2 million RMB; Employer (year-

end)>40Other sectors: spot check

Census collects value-added data from all organizations

Wholesale, retail, hotel & catering

Yearbook Census Census/

Yearbook

(times)

Number of enterprises

138,086 1,403,000 10.16

Employee 11,374,819 18,912,000 1.66

Revenue 187,656.8 247,483 1.25

Total assets 75,118.3 121,619 1.62

Only collect gross output value from industrial enterprises by year

• Following former Soviet system, industrial enterprise accounting didn’t use the concept of value-add before 2009.

• The concept of value-add in constant price is even more difficult than for industrial enterprises.

• All value-add data for agriculture and industrial sectors are estimated by national and local statistical bureaus.

Key Energy Data Points • Statistical Communiqué on the 2008 National Ec

onomic and Social Development (issued on February 26th 2009) estimated total energy consumption of 2008 was 2.85 billion tce (coal equivalent calculation).

• China Statistical Yearbook 2009 (published in September 2009) adopted the same number(2.85 billion tce).

• Total energy consumption of 2008 was adjusted to 2.91 billion tce after census, increased 2.12%.

• Statistical Communiqué on the 2009 National Economic and Social Development (issued on February 25th 2010) estimated total energy consumption of 2009 was 3.10 billion tce.

Energy Yearbook 2009 revised energy consumption data from 2005 to 2007 based on the results of the 2nd national economic census in 2009

Version of Yearbook 2009 2008Discrepancy to 2nd

census (%)

2005 225781 214466 5.28

2006 247562 235156 5.28

2007 268413 253488 5.89

2008 277515 -- --

Primary Energy Consumption (10ktce, calorific value calculation )

Differences mainly in coal from 2nd censusSource: Energy Statistical Yearbook 2008, 2009

2007 Before census After census Discrepancy (%)

Primary EnergyConsumption(104tce)

253488 268413 5.89

Coal (104ton) 258641 272746 5.45

Petroleum (104ton) 36570 36659 0.24

NG(108cu.m) 695 705 1.47

Hydro power(108kWh)

4853 4853 0.00

Nuclear power(108kWh)

621 621 0.00

Energy Efficiency Improvement

Beforecensus

GDPConstantprice

EnergyConsumption(coal equivalentcalculation)

EIEIDecreaserate(%)

GDPCurrentprice

Inflation (%)

2005 183217.4 224682 1.23 183217.4 0

2006 204556.1 246270 1.20 1.83 212923.5 4.09

2007 231228.4 265583 1.15 4.60 257305.6 11.28

2008 252039 285000 1.13 1.55 300670 19.30

2009

SourceStatistical Yearbook2009

EnergyStatistical,Communiqué

Cal. Cal.Statistical Yearbook2009

Cal.

EI decreased 8.13% from 2005 to 2008.


After census

GDP (constant price)

Energy Consumption (coal equivalent calculation)

EI

EIdecrease rate(%)

GDPcurrent price

Inflation (%)

2005 184937 235997 1.276 184937 0

2006 208442 258676 1.241 2.74 216314 3.78

2007 237920 280508 1.179 5.04 265810 11.72

2008 260687 291448 1.118 5.20 314045 20.47

2009 284680 306600 1.077 3.16 335353 17.80

Source:

Calculated by EI and energy consumption

Energy Statistical

NSBDocument2010

NSBDocument2010

CommuniquéCal.

EI decreased 12.38% from 2005 to 2008; decreased 15.6% from 2005 to 2009


After census

GDP (constant price)

calorific value calculation coal equivalent calculation

Energy Consumption (% of hydro & nuclear)

EI Energy Consumption(% of hydro & nuclear)

EI

2005 184937 225781 (2.5) 1.221 235997 (6.8) 1.276

2008 260687 277515 (3.0) 1.065 291448 (7.7) 1.118

△2008-

2005

75750 51734 55451

EI decreased 2005 to 2008

12.78% 12.38%

1. Total energy consumption coal equivalent calculation based is not transparent since the data of coal consumption per kWh generated changed year by year and not be published formally.

2. Prefer to use coal-based number since it shows a bigger share of clean energy while 15% target was set by 2020.

3. May be change to use calorific-based number since it shows a big improvement on EI.

Part B: China LEAP Modeling Efforts

Basic Assumptions

• Base year: 2000 ->2005

• Target year: 2030

• Dataset: AES2007 Draft

• LEAP2008

• Three scenarios: BAU (considering regional cooperation), Maximum Nuclear Path(MaNS), Minimum Nuclear Path(MiNS)

• Data source

Per capita GDP

• China’s per capita GDP is expected to be quadrupled by the year 2020 as against 2000 in the report of 17th NCCPC on October 2007.

2000 yr: 7078 RMB (856 US$)

2020 yr: 28000 RMB (3500US$,

not considering rate fluctuation)

2006 yr: 2024 US$

• This goal is much higher than the target set by the CPC five years ago at the 16th National Congress which was to quadruple the GDP value, without the mention of per capita by 2020.

• But the rapid growth will be under the condition of reduced consumption of resources and greater efforts in environmental protection.

Per capita house area and urbanization

• Industrialization and urbanization have speeded economic development.

• Per capita income will increase and people living level will be improved.

• Although there is a big income gap between urban and rural residents, per capita house area is expected to be similar by 2050.

The urban-rural income disparity has been increased recently

Source: LI Shantong, 2006

Population and GDP assumptions

• The BAU scenario reflects a 20-year economic development path that yields average annual GDP growth rates of 8.38% between 2010 and 2020 and 7.11% between 2020 and 2030.

• China’s population forecast in the model, adopting national population plans and projections, shows the peak of total population arriving between 2030 and 2040, at 1.47 billion people, with continued and pronounced movement of population from rural to urban area.

Year Population (million persons)

Urban HH (million)

Rural HH (million)

GDP (108 yuan RMB)

2005 1308 190 183 183132 2010 1360 222 190 290505 2020 1440 288 181 649852 2030 1470 337 160 1291047

Nuclear power scenarios changesInstalledcapacity

(GW)share

Installedcapacity

(GW)share

Installedcapacity

(GW)share

S1 8.7 1.60% 25 3.50% 45 4.50%

S2 (BAU) 8.7 1.60% 20 2.80% 40 4.00%

S3 8.7 1.60% 15 2.10% 30 3.00%

2005 2010 2020

Installedcapacity

(GW)share

Installedcapacity

(GW)share

Installedcapacity

(GW)share

Maximum Nuclear Path 8.7 1.60% 25 3.5% 80 8%BAU 8.7 1.60% 15 2.1% 40 4%Minimum Nuclear Path 8.7 1.60% 12 1.7% 20 2%

2005 2010 2020

AES2006AES2006

AES2007 AES2007

　 2005 2010 2020 2030

　Installed capacity

(GW)share

Installed capacity

(GW)share

Installed capacity

(GW)share

Installed capacity

(GW)share

Maximum Nuclear Path 8.7 1.60% 25 3.5% 80 8% 134 8%

BAU 8.7 1.60% 15 2.1% 70 7% 100 4%

Minimum Nuclear Path 8.7 1.60% 12 1.7% 60 6% 80 2%

AES2010 AES2010

Industry assumptions

• Based on China’s government policy, growth in the most energy-intensive industrial sectors will be controlled and mainly used to fulfill domestic needs, and energy efficiency measures will be implemented in those sectors to enhance energy savings.

• In the steel, cement, and pulp and paper sectors, for example, physical output is projected to rise through 2020, but then fall slightly (steel), remain unchanged (cement), or rise only slightly (pulp and paper) through 2030.

• At the same time, the energy intensities per unit physical product in these industries is projected, in the BAU path, to fall by 1.0 to 1.8% annually, varying by industry and time period (China Low Carbon Scenario, 2009).

Results for BAU Scenario

• BAU Scenario Energy Demand by Sector, 2000-2030

0

500

1000

1500

2000

2500

3000

3500

4000

4500

2000

2002

2004

2006

2008

2010

2012

2014

2016

2018

2020

2022

2024

2026

2028

2030

Mill

ion

To

nn

es

Co

al E

qu

iv.

Agriculture

Transport

Commerce

Industry

Households


• BAU scenarios transport energy demand, 2000-2030

0

200

400

600

800

1000

1200

2000 2005 2010 2015 2020 2025 2030

Mill

ion

To

nn

es

Co

al E

qu

iva

len

t

Passenger Transport

Freight Transport


• BAU Scenario Final Energy Demand by Fuel, 2000-2030

0

500

1000

1500

2000

2500

3000

3500

4000

4500

2000 2005 2010 2015 2020 2025 2030

Mill

ion

To

nn

es

Co

al E

qu

iv.

Biomass Coal Coke and Peat

Crude Oil Electricity

Heat Natural Gas

Oil Products Other fuels

Renewables


• BAU Energy Supply Outputs by Fuel, 2000-2030

0

500

1000

1500

2000

2500

3000

3500

4000

4500

5000

2000

2002

2004

2006

2008

2010

2012

2014

2016

2018

2020

2022

2024

2026

2028

2030

Mill

ion

To

nn

es

Co

al E

qu

iv.

Other fuels

Oil Products

Natural Gas

Heat

Electricity

Crude Oil

Coal Coke and Peat

Biomass

Results for three Scenarios

• Greenhouse Gas Emissions, 2000-2030, Three Scenarios for China

0

2000

4000

6000

8000

10000

12000

2000

2002

2004

2006

2008

2010

2012

2014

2016

2018

2020

2022

2024

2026

2028

2030

Mill

ion

To

nn

es

CO

2 E

qu

iv.

BAU Reference

Maximum nuclear path

Minimum nuclear path

Conclusions

• China has experienced rapid growth in energy consumption in the recent years. Large amounts of investment have been provided for the power industry and for oil stockpile facility construction to secure energy supplies to support rapid economic growth.

• To realize China’s sustainable development, the national energy development strategy includes an energy conservation priority policy, and at the same time is vigorously developing renewable energy and new energy in China. A cleaner energy system and energy development strategy are needed, and should be established through government involvement leading to changes in all production processes and lifestyles through the applications of laws, regulations and fiscal policies.

• Vehicle emission problems in particular require special attention, especially those associated with increases in freight and passenger transport energy consumption.

Documents

Updates on the Chinese Energy Sector