(C) 2017 IEEJ, All rights reserved 1 · Water Heater Cooking LightingG Appliance LightingG...

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(C) 2017 IEEJ, All rights reserved



Outline

1. International Comparison of Total Primary Energy Consumption per GDP

2. Japan’s Energy Efficiency and Conservation Policy Framework

3. Challenges and Changing Market Environment for Japan’s Energy Efficiency and Conservation

4. Energy Supply/Demand Structure toward CO2 Emissions Reduction Target in 2030

5. Toward Deepening Japan’s Energy Efficiency and Conservation – Overview of New or Enhancing EE&C Policies

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(C) 2017 IEEJ, All rights reserved 3

1. International Comparison of Total Primary Energy Consumption per GDP

(Source) IEEJ “Handbook of Energy & Economic Statistics in Japan“

0

100

200

300

400

1970 1980 1990 2000 2010

toe

/$2

01

0 m

illi

on

Saudi Arabia

Brunei

U.S.

Japan

U.K.

2013



2-1. Energy Efficiency Policy Framework

Industry Commercial Residential Transport R

egu

lati

on

Ec

on

om

ic In

cen

tive

s

Regular Reports, Medium to Long-term Plans, 1% Annual Energy Efficiency Improvement

Compliance with EE Standards

Top Runner Standard, Performance Labeling System

Regular Reports, 1% Annual Energy Efficiency Improvement

Benchmark System

Voluntary Action Plan

Subsidy Systems (Equipment Investment, Housing Insulation Retrofit, Clean Energy Vehicles, etc.)

Green Investment Tax Cut, Special Depreciation, etc.

Free Energy Conservation Audit for SMEs

Information Provision, National Campaign, Award System

R&D Subsidies (High-Performance Heat Pumps, Highly Efficient Gas Engines, Innovative Batteries, IoT Technologies, Autonomous Driving Systems, etc.



2-2. Factors Affecting the Successful Implementation of Key EE Policies

Energy Management System • EE&C improvement efforts by the in-house experienced energy managers being

supported by government’s stable provision of economic incentives and know-how

sharing platform

Benchmark System • Assist EE efforts by the factories/business entities with the intra-industry

comparison

Voluntary Action Plan • Facilitate intra-industry sharing and deployment of best practices

Top Runner Program • R&D efforts by the manufacturing industries and consumers’ choice toward EE

technologies – supported by labeling and economic incentives



3-1. Challenges and Changing Market Environment for Japan’s Energy Efficiency

• Japan faces challenges to continuously make progress on energy efficiency building on the conventional approach. • Energy Management System

• Manufacturing industry’s pace of energy intensity improvement represents slower compared with that of commercial sector.

• Top Runner Program • Substantial achievement in technology energy efficiency has been made

historically (AC: 30%, Passenger Vehicles: 48.8%). Manufactures may face challenges to find technological options for cost effective energy efficiency improvement.

• Consumers’ energy consumption pattern may change under

the deregulated energy market environment. • Electricity retail competition introduced in April 2016 • Gas retail competition – to be introduced in April 2017



3-2. Japan’s Large-Scale Energy Users’ Energy Intensity Improvement

Manufacturing industry’s energy intensity level showed relative small improvement since 1999. By contrast, the commercial sector’s energy intensity substantially improved since its start in 2002.

Trends in Energy Intensity: Manufacturing Industry and Commercial Sector

Commercial Sector Energy Consumption

Manufacturing Energy Consumption

‘99 ‘13

Energy Intensity (Manufacturing)

Energy Intensity (Commercial)

Ener

gy

Cons

umpt

ion

Ener

gy In

tens

ity (a

gain

st ba

se ye

ar)

‘12‘11‘10‘09‘08‘07‘06‘05‘04‘03‘02‘01‘00



3-3. Improvements in Energy Efficiency with Top Runner Program

1174 1220

1241

1212 1157

1048

1028

1028 997

966 924

884

870

600

700

800

900

1000

1100

1200

1300

1999 2001 2003 2005 2007 2009 2011

12.3

12.1

12.4 12.9

13.2

13.5

14.0

14.6

14.7

15.0

15.1

15.5

15.7

16.5

17.8 18.3

8

10

12

14

16

18

20

19951997199920012003200520072009

48.8% improvement

FY

30% improvement

[ Passenger cars ] [ Air conditioners ]

Transition in fuel economy of average new cars

Fuel

economy

(km/L)

(Note) Fuel economy values for the 10-15 mode. (Note) Wall mounted cooling and heating units with cooling capacity of 2.8kW-class model; simple average values for a representative model of energy conserving-type products.

FY

Electric power consumption for period

Electric power consumption for period (kWh)



4-1. Energy Supply/Demand Structure toward CO2 Emissions Reduction Target in 2030

○ While energy demand growth is projected in

line with economic growth (an average 1.7%), energy efficiency is expected to improve as much as after the oil crises thorough energy conservation (35% in 20 years).

○ Energy supply/demand structure

improvement (energy self-sufficiency rate: 6% in 2014 ⇒24.3% in 2030）

○ Japan’s CO2 emissions reduction target

(26% CO2 emissions reduction in 2030 compared with 2013 level)

(Source) METI “Long-term Energy Supply/Demand Outlook” p.5 (July 16, 2015)

FY２０３０（After Energy

Savings）

FY２０１３（Actual）

Final Energy Demand

HeatGasolineCity gas７５％

Electricity

２５％

３６１million ｋｌ

Sweeping Energy Savings

50 mllion kl（▲13% w.r.t.

reference case）

Electricity

２８％

HeatGasoline City gas７２％

GDP1.7％/year

３２６million kl

Primary Energy Supply

Self-sufficiency ２４．３％

FY ２０３０

Coal ２５％

Natural Gas １８％

Oil ３０％

Renewables１３～１４％

Nuclear１１～１０％

４８９million ｋｌ

ＬＰＧ３％



4-2. Need for Further Improvement of Energy Efficiency

• Thorough energy conservation measures could save final energy demand by 13% to 326 million kl.

• Energy conservation measures would be accumulated to improve energy efficiency as much as just after the oil crises.

60

70

80

90

100

110

0 5 10 15 20

1970-1990

1990-2010

2012-2030

【Improvement in Energy Intensity】



5-1. Toward Deepening Japan’s Energy Efficiency – Overview of New or Enhancing EE Policies

Sector Energy Savings in

2030 EE&C Policies to Realize the Estimated Energy Savings

Industry Factories：10.42 billion Liter

Strengthening Benchmark Standard Strengthening Review System for Energy Management System Energy Audit for Small and Medium Sized Entities Promoting Joint EE&C Efforts by Multiple Entities

Commercial Buildings・Stores：12.26 billion Liter

Strengthening Benchmark Standard Strengthening Review System for Energy Management System Energy Audit for Small and Medium Sized Entities Top Runner Standard Mandatory Compliance on Building EE Standard Wider Diffusion of Zero Energy Building Provision of EE Information by Energy Suppliers and Potential for

Energy Efficiency Obligation

Transport

Freight Truck：6.68billion Liter Vehicles：9.39 billion Liter

Traffic Demand Management・Eco-Driving Improvement of Freight Delivery Service Top Runner Program Autonomous Car Driving

Residential

Appliances：6.03 billion Liter Housing：5.57 billion Liter

Top Runner Program Mandatory Compliance on Housing EE Standard Wider Diffusion of Zero Energy House Provision of EE Information by Energy Suppliers and Potential for

Energy Efficiency Obligation

Amendment of Energy Conservation Law to mandate electric utilities to provide consumers with EE information in 2013



39

53

50

47

23

10

17

8

6

10

13

14

2

4

2

5

3

9

10

11

11

15

33 6

1

1

0 20 40 60 80 100

USA (2009)

Germany (2010)

France (2010)

UK (2010)

Korea (2008)

Japan (2011)

Heating

Water Heater

Cooking

Lighting・Appliance

Lighting・

Appliance・OthersCooling

GJ/Household

20.2 21.8 21.9 25.4 25.5 26.0

0

5

10

15

20

25

30

Denmark UK Japan USA Germany France

5-2. Some Issues for Deepening EE – Residential and Commercial Sectors

Commercial Energy Consumption per Floor Space (toe/m2)

Issues for Deepening Middle/Small Sized Commercial EE

(Source) Denmark・France・Germany・UK：IEA（2013）：Energy Balances of OECD Countries, BPIE（2011）.Europe’s Buildings Under the Micro Scope. Japan：IEEJ (2014)：「Energy Statistics」 , USA：IEA（2013）：Energy Balances of OECD Countries, US EIA (2013).2012Commercial Buildings Energy Consumption Survey.

• Information Gap • Financial Constraint • Short-term View • Split Incentive

Residential Energy Consumption per Household (GJ/household)

(Source) Jyukankyo Keikaku Kenkyu-sho (2014).

Japan’s Household Appliances Diffusion (units/household)

0

50

100

150

200

250

300

1990 1995 2000 2005 2010 2014

Room ACRefrigeratorFlat Panel TVPCElectric Toilet Heater

(Source) IEEJ (2014)：「Energy Statistics」.



5-3. Japan’s Energy Conservation Law: Article 81.7 – Requirement for Electric Power Companies

Article 81.7 Electricity supply business entities are required to

plan for measures that can facilitate leveling of electricity load.

1. Preparation of electricity tariffs and other options/menus for

consumers to leveling electricity load.

2. Preparation of providing technologies that can measure

consumers’ electricity consumption and information to

facilitate electricity load leveling.

3. Preparation of information regarding electricity demand and

supply including actual and projection.

Retail suppliers’ preparation on electricity tariff menus

T&D companies’ preparation on smart meters

T&D companies’ preparation on information provision



5-4. Electricity Suppliers’ Provision of Energy Savings Information to Consumers

(Source) Ministry of Economy Trade and Industry. 2016. “Study Group on Guidelines for Energy Retail Suppliers’ Energy Efficiency”

Example of Tokyo Electric Power Company

The website allows comparison of monthly electricity consumption with a similar household structure, floor space, number of heating/cooling units, and hot water boiler technology.



5-5. Electricity Suppliers’ Provision of Energy Savings Incentives to Consumers


Service Energy Supplier

Energy Savings Incentives

Economic

Incentives

Discount Tokyu Power

Supply • Electricity tariff discount for those customers utilize rails to

go to department store related to Tokyu group.

Provision of

Refundable

Points

Tokyu Power

Supply • Provision of point to those customers utilize rails related to

Tokyu group during the summer peak hours.

ENET

NTT Facilities • Provision of points to those customers save energy during

the peak hours.

Provision of

Refundable

Coupon

Hokuriku Electric

Power Company • Provision of coupons during the peak hours to encourage

consumers’ energy savings

ENET

NTT Facilities • Provision of coupons during the peak hours to encourage

consumers’ energy savings

Log-in to the website

Example of Hokuriku Electric Power Company

Print out the coupon or download to smart phone

Turn off AC/lighting for shopping…



5-6. Status/Plan for Smart Meter Rollout


Smart meter rollout for large-scale consumers have been completed, while that of residential/commercial customers will be completed by 2023.



5-7. Toward Deepening Japan’s EE Efforts

• In view of the need to introduce new EE policy approach, Japan strengthens provision of EE information by energy suppliers to facilitate consumers’ behavior change.

• Introduction of Energy Efficiency Obligation system is under consideration, while its benefits and costs across the world will be investigated further. Issues to be considered are: • Maintain consistency with the existing EE policy framework

• Obliged parties/funding source

• T&D companies/network tariff

• Retail companies/electricity fare

• Appropriate incentive mechanisms for energy suppliers.

• Appropriate monitor, review and verification mechanism.



Thank you for your attention.

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