Case Study of Energy Efficiency in Asia and Internationally: Some Examples and Food for Thought

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Case Study of Energy Efficiencyin Asia and
InternationallySome Examples and Food for
Thought

• Peter du Pont, Ph.D.
• Chief of Party, ECO-Asia Clean Development and
  Climate Program
• 14 May 2009
• Presented at
• First Mekong Energy and Ecology Training (MEE
  NET)
• Bangkok, Thailand

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U.S. contributionto offset emissions of
officials flying to international climate change
meetings
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Whats Happening?
Chaos or Opportunity?
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Disclaimer

• I am not Asian
• I do not represent Asia
• I live in Asia, and have for 17 years
• My role is as a consultant and facilitator
• Designing, implementing, and monitoring EE
  programs
• Lots of failures, a few successes -)
• I have been involved with a number or regional
  and international organizations
• International Institute for Energy Conservation
• APEC Energy Standards Information System
  (www.apec.esis.org)
• APEC Expert Group on Energy Efficiency
  Conservation (www.egeec.apec.org)
• International CFL Harmonisation Initiative
  (www.apec.esis.org/cfl)
• Efficient Lighting Initiative (ELI)
  (www.efficientlighting.net)
• USAID ECO-Asia Clean Development and Climate
  Program (www.cleanenergyasia.net)

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Objectives of This Talk

• Identify key issues related to energy efficiency
  (EE) in context of energy policy
• Highlight and explain some case studies
• Address issue of how much EE costs
• Present some questions in a range of topic areas
• Caveats
• This presentation discusses experience with in EE
  in commercial energy
• Does not address transportation energy
• Does not address links between energy and poverty

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Topics Covered

• About the ECO-Asia Clean Development and Climate
  Program
• Overview of energy and carbon scenarios
• What drives energy demand and how reliable are
  demand forecasts?
• Some case studies and examples of Energy
  Efficiency policies and programs
• How much does Energy Efficiency cost?
• Issues, themes and food for thought

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About the ECO-Asia Clean Development and Climate
Program
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ECO-Asia Clean Development and Climate Program
Geographic Coverage

• China
• India
• Indonesia
• Philippines
• Thailand
• Vietnam

These 6 countries account for 96 of the GDP of
Asias developing countries
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USAID-funded review of clean energy priorities in
Asia

• Objectives
• Identify clean energy priorities technologies,
  sectors, and initiatives
• Identify opportunities for regional action
• Methodology
• organized listening tours with 220 key energy
  stakeholders in the 6 countries
• researched and prepared more than 300 profiles on
  clean energy institutions, policies, programs
• prepared in-depth country reports on the clean
  energy opportunities in the 6 countries

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INCREASING CO2 EMISSIONS Developing Asias CO2
Emissions Will Increase 4-Fold
Current 26 billion metric tons CO2
2030 40 billion metric tons CO2
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Source APERC, TERI
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Projected CO2 Emissions by Sector (2002 - 2030)
ELECTRICITY IS MAJOR SOURCEMore than half of CO2
emissions from power plants
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Source APERC, TERI
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Ranking of clean energy options for regional
cooperation
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Implementing Just These Options Can Reduce Future
Emissions from Asias Developing Economies by 25
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ECO-Asia CDCP Three sectors three locations
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What Drives Energy Demand and How Reliable are
Demand Forecasts?
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What Drives Energy Demand?

• Incomes rise
• People buy more stuff
• The force is basically unstoppable

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Increased Saturation of Air ConditionersHelps
Drive Demand
Source APERC 2006
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Growth in Personalized Transport Will Fuel Demand
for Oil
Growth in Number of Vehicles in Asia (1973-2002)
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How Scientific Are Demand Forecasts?

• Forecasting is an art, not a science
• Forecasters historically have tended to err on
  the side of overbuilding
• Forecasts to not tend to take into account
  possible EE improvements
• Cost of over building is rarely analyzed by
  fiscal agencies (no penalty for getting caught)

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Over Time, Demand Forecasts Tend to be High (1)
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Over Time, Demand Forecasts Tend to be High (2)
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Over Time, Demand Forecasts Tend to be High (3)
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Some Case Studies and Examples of Energy
Efficiency Policies and Programs
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Policy Action on Energy Efficiency Can Clearly
Make a Difference (U.S. States vs. Federal)
Total Electricity Use, per capita, 1960 2001
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DSM on Appliances and Equipment is Greatest
Source of Savings (Australia)
Abatement through Year 2010 from Australias
Energy Efficiency Programs (Source Australian
Greenhouse Office)
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Australia ExampleDomestic Refrigerators, 1980 -
2006
Refrigerator use has fallen by more than 60
kWh/year
Source AGO
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U.S. ExampleDomestic Refrigerators, 1947 - 2004
Refrigerator use has fallen by more than 2/3
since 1973, while volume has increased and price
has decreased
(Source Goldstein, NRDC 2005)
U.S. Refrigerator Energy Use vs. Time, with Real
Price Changes.
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Korean Example (Standards and Labeling)Substanti
al Gains Can be Made Quickly
(Source Sun-Keun Lee, 2001)
Change in Average Market Efficiency of Korean
Appliances, 1993 2000
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CASE STUDY ON INFORMATION
APEC Energy Standards Information System
www.apec-esis.org
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Objectives of APEC-ESIS

• Established with APEC funding in 2002
• Serves as clearinghouse for data and documents
  that specify aspects of energy efficiency,
  including
• Test protocols
• Energy performance information and labeling
• Energy performance categories and minimum
  requirements
• Minimum energy performance requirements
• Other energy performance requirements
• Facilitate and stimulate harmonization through
  the Standards Notification Procedure
• Promote international cooperation (esp. within
  APEC) and reduce barriers to trade in
  energy-efficient products

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View of Database from ESIS Home Page
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View of a Country Page
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Current Status of ESIS

• Broadening Participation in APEC-ESIS.
• 38 Economy contacts participating from 17 of the
  21 APEC economies.
• Sponsorship with CLASP for Global Database.
• CLASP sponsored expansion of APEC ESIS database
• Development of Global Standards and Labeling
  Database launched in August 2005
• Expanded from 21 APEC economies to include 54
  economies worldwide
• More than 1,700 standards maintained.
• REEEP funding to expand ESIS to WESIS
• World Energy Standards Information System

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CASE STUDY ON FINANCEThailand Energy Efficiency
Revolving Fund

• EE Revolving Fund launched in January 2003.
• Objective stimulate financial sector involvement
  in EE projects and to simplify project evaluation
  and financing procedures.
• Fund provides capital at 0 interest to Thai
  banks
• Banks can on-lend at ? 4
• Projects vetted by DEDE to ensure they are EE or
  RE projects

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Key Results from Phase 1 of the EE Revolving Fund
US 630m
US 300m
US 103m
US 57m
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EE Savings by Measure in Phase 1 EE Revolving Fund
Total EE cost savings US 39 million/year
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Phase 2 Launched in March 2006THB 2,000
million11 banks participating
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How Much Does EE Cost?
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World Bank Study of Fuel Options in Thailand
Source The World Bank (1993)
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DSM vs. Cost of New Supply in Thailand (ACTUAL)
Source Electricity Generating Authority of
Thailand (2001)
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World Bank Study of EE/DSM Potential in Relation
to the Nam-Theun 2 Hydropower Project

• Carried out in 2005
• Assess whether NT2 power (about 1,000 MW, 5,500
  GWh/annum) is required by the Thai system by the
  projected commissioning date of 2010
• Assess the achievable potential for Thailands
  initiatives at promoting EE and DSM when NT2 is
  proposed to come on line

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Achievable DSM/EE Potential in 2011
Total potential of 2,459 MW
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Commercial Costs of DSM/EE and NT2 Resources
DSM/EE is 40 of the cost of NT2
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Why Is It So Difficult to Mainstream EE?
End Users Industrial, Commercial
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Issues, Themes, and Food for Thought
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List of Issues

• Why are DSM (demand side management) and EE
  separate in many countries?
• Institutional Issues
• Information and coordination
• Climate change

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Why are DSM and EE Separate?

• Why are DSM and Energy Efficiency Separate?

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Institutional Issues (1)

• QUESTION How can you get the government
  commitment to allocate and train human resources
  to get the job done?
• Benchmarking of DSM in some Asian countries

Country Year Estd Location No. Staff Comments
Thailand 1994 Utility 150 1,300 MW savings to date Funded through tariff
Sri Lanka 1999 Utility 15 Start-up funding from World Bank
Vietnam 2001 Utility 4.5 120 MW target by 2007 Part-time staff in Power Companies
Malaysia 2001 Energy Commission 8 Start-up funding from Danida No long-term finding
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Institutional Issues (2)

• Korea and Mexico have set up national agencies
  which direct implementation of EE
• KEMCO in Korea
• CONAE in Mexico
• This brings a coherence to EE policy and programs
• What does it take to seed and enable
  self-sustaining energy efficiency agencies within
  a country?

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QUESTION How Can We Rationalize and Coordinate
Standards and Labeling?
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QUESTION How Can We Set Carbon and Energy Use
Targets that Are Equitable?
???
???
???
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Myth Western Consultants are Needed to Help
Advise Asian Governments on How to Implement EE

• Sure, there is a lot of great experience in
  Europe and the U.S.
• But there is also a lot of great experience
• 2 Examples
• Energy labeling in Thailand
• Air conditioners in Australia and East Asia
• QUESTION
• How can we systematize sharing of information and
  EE best practices between countries in Asia?

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Myth CDM is a Mechanism that will Help Stimulate
Investments in EE in Developing Countries

• Less than 95 of registered CDM projects are for
  EE
• Transaction costs are way too high
• QUESTION
• Programmatic CDM may be an answer, but how
  quickly will it happen?

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Thank you!! For more information peter_at_cleanene
rgyasia.net www.cleanenergyasia.net