Fossil Fuel and EnvironmentIndia and ASEAN

15 Feb 2020 Jun ARIMA

Senior Policy Fellow for Energy and EnvironmentProfessor, GrasPP, University of Tokyo

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Outlook of Fuel Mix in ASEAN in BAU

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Total Primary Energy Supply in BAU

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1990 2000 2015 2020 2030 2040

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Share in Total Primary Energy Supply in BAU

Fuel Mix for Power Generation in BAU

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1990 2000 2015 2020 2030 2040

Coal Oil Natural gas Nuclear Hydro Geothermal Others

Share of Fuel Mix for Power Generation in BAU

Source : ERIA Energy Outlook and Saving Potential of East Asia Summit Countries 2018

Fossil fuel will play dominant role in ASEAN energy mix in coming decades.

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Coal Oil Gas Nuclear Hydro Other RE

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1990 2000 2015 2020 2030 2040

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Outlook of Fuel Mix in India in BAU

Source : ERIA Energy Outlook and Saving Potential of East Asia Summit Countries 2018

… and India energy mix as well.

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Outlook of CO2 Emissions (2018-2050)

Source : IEEJ Asia and World Energy Outlook (2019)

Global CO2 emissions growth depends on Asian region, most notably, India and ASEAN.

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What 1.5-2.0 Degree Target Means In the IEA’s Paris compatible SDS, the share of fossil fuel in power generation,

in particular, coal, needs to be dramatically reduced.

IEA World Energy Outlook 2018

Global Power Generation MixGlobal CO2 Emissions

38%

26%

5%

4%

1%

1%

23%

22%

14%

10%

9%

13%

16%

15%

19%

2%

4%

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12%

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2%9%

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2017 2040NPS 2040SDS

Coal Oil Gas Nuclear

Hydro Bioenergy Wind Geothermal

Solar PV CSP Marine 5

37% 40%

5%

3%1%

41%

29%

27%

13%

15%

24%

1%5%

14%0%

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2%

3%

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2017 2040NPS 2040SDS

What 1.5-2.0 Target Means for SE Asia and India

In the SDS, South East Asia and India also needs to substantially reduce the share of fossil fuel in power generation, in particular, coal.

IEA World Energy Outlook 20183

74%

48%

6%

2%

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1%

5%

7%

20%

3%

6%

8%

9%

8%

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11%

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2017 2040 NPS 2040 SDS

Coal Oil Gas Nuclear

Hydro Bioenergy Wind Geothermal

Solar CSP Marine

India South East Asia

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“Keep Them Under Ground” To achieve 2 degrees target, 88% of coal reserves must be kept under ground.

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Stigmatization of Coal at COP25

“Either we stop this addiction to coal or all our efforts to tackle climate change will be doomed”. (UN Secretary General A. Guterres @COP25)

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OECD has issued a report urging stopping ODA to fossil fuel related activities.

European Investment Bank (EIB) stops financing on fossil fuel from 2021.

EU is now developing “green taxonomy” labeling finance to fossil fuel related activities (e.g. coal power plants) as “unsustainable” and intends to make their taxonomy global standard though ISO.

Squeezing Finance to Fossil Fuel Sector

New finance to fossil fuel related projects in ASEAN region could be squeezed.

Utilization of cheap domestic coal resources could be constrained. Energy access with affordable cost could be threatened. Replacement of old and inefficient plants with high efficiency low

emissions technologies could become difficult. , which is contrary to GHG emissions reduction

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EAS region faces multiple challenges

Climate change is one of 17 SDGs, not the supreme objective taking precedence to others. There are synergies and trade-offs between climate action and other objectives.

Most SDGs are predicated by robust economic growth underpinned by cheap and reliable energy supply

Climate Change and SDGs

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11Source: United Nations My World 2015 (May 2013)

UN global poll engaging 9.7 million people (HDI high countries 44%, medium countries 27%) in May 2013 indicates highest priority on education, healthcare and job opportunities while climate change comes at the bottom.

Nigeria 2,735,062

Mexico 1,978,589

India 902,920

Pakistan 701,933

Sri Lanka 665,533

Yemen 413,591

China 321,853

Among respondents fromtop 7 countries (79% oftotal), 74% comes from low,middle HDI countries

What Matters Most to You?

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Affordable Energy Access: Priority for Developing Countries

Overcoming energy poverty is prerequisite for achieving SDGs Globally, nearly 1 billion people still lack access to electricity. Improving

electricity access in 2000-2015 has been largely achieved by fossil fuel (68%) , most notably, coal (44%).

Abundant coal reserves in Asian region cannot simply be neglected.

IEA Energy Access Outlook 2017 WEO Special Report 12

Energy related Investment Needs in Asia (2018-50)

Asia needs energy related investment of $27.5 trillion from 2018 to 2050. 40% of them goes to India and ASEAN

Fossil fuel related investment amounts $7.9 trillion (28% of total)

Source : IEEJ Asia and World Energy Outlook (2019)13

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The EAS Ministers discussed the work plans being implementedunder the EAS cooperation, including energy efficiency,renewable energy, natural gas, alternative and low emissiontechnologies. The Ministers also acknowledged the continued roleof fossil fuels including natural gas and clean coal technologies inthe region in order to contribute to the region’s economic growth,energy security and environment protection. To this end, theMinisters called for deeper cooperation and concrete efforts, inmobilizing finance from a wide variety of sources, to takeadvantage of the broad range of energy resources and cleanenergy technologies to achieve regional economic growth, energysecurity and sustainable ecosystems

EAS Region Needs All Available Options

Joint Ministerial Statement EAS Energy Ministers Meeting (29 Oct 2018)

All the options should be pursued in Asia for reducing CO2 emissions

through energy efficiency, clean use of coal, fuel switching, nuclear,

renewable and adoption of innovative technologies (CCS, Hydrogen

etc) reflecting each country’s circumstances

Fossil fuel will continue to play a vital role in coming decades for

fueling economic through affordable energy supply.

Squeezing finance to fossil fuel related sector could have negative

implication to affordable energy supply in Asia.

Growing gap between energy reality in Asia region and COP discussion.

Asian region needs to deliver messages about their energy reality and

to promote pragmatism to the COP discussion

Reflecting Asian Energy Reality in the Global Debate

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Thank you very much

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