Morihiro KURUSHIMAProfessor

Toyo Univ. / NEDO

Japan’s Energy and Environmental Policies with its industries

15 May 2007

1

In UK, Japan and all over the world “Making Business Sense of Climate Change”

Part I Overview of the Global Energy Situation and Recent ChangesPart II Importance of Energy Conservation and New Energy

Part III A Way to the World Tech. Bank for Energy & Environment

UK Ambassador, Sir Graham atToyo Univ. in 2006

Contents

3

　　

　Fragile Energy Supply Structure

- Scarce domestic energy resources- Low ratio of self-supply of energy compared

to other major countries- High dependency on oil from the Middle East

CharacteristicsCharacteristics

Energy in Japan in Comparison to the WorldEnergy in Japan in Comparison to the World

(％)

19.7

70.5

44.636.5

75.3

0

20

40

60

80

100

Japan U.S.A . Fance Germany Eng land

Ratio of the Self-supply of Energy in Major Countries (2000)

Source: IEA “Energy Balances of OECD Countries 2002”

86%

26%

37%

13%5%

48%40% 37% 39%

34%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Japan U.S.A. France Germany England

Dependency on theMiddle EastDependency on oil

Dependency on the Middle East for Oil and Dependency on Oil in the World (2000-2001)

Source: BP Statistics 2002 and IEA, Oil and Gas Information (2002)

（％）

Source: IEA “Energy Balances of OECD Countries 2002”

Primary Energy Supply and Its Ratio in Major Countries (2000)

Japan U.S.A. France Germany UKPrimary energy supply(oil conversion: mtoe ) 525 2300 257 340 233

Coal 18 24 6 24 16Oil 51 39 34 39 36

Natural gas 12 24 14 21 38Nuclear power 16 9 42 13 10Hydropower 1.4 0.9 2.2 0.6 0.2

Recyclable energy, etc. 2 4 2 3 2

4

LetLet’’s go with Industriess go with Industries

1. Feasibility Study / Basic Survey

in Mexico in Thailand

Entrust NEDO Private

Sector FS

5

2. Project Formulation In Mexico In Thailand

Mitsubishi Electric Corp.

Japan AMA

Japan EXIMBank Finance

Thai AIA/ OCMRT, MOSTE Consultation

Mexico BANOBRAS

Priv. Bank

6

3. Project Implement.

In Mexico & Thailand

Japan AMA

Export (200 vehicles)

Monitoring, Construct. etc. Traffic Improvement Project in Bangkok

Mexico STE

Mitsubishi Electric Corp.

7

Part I　

Overview of the Global Energy Situation and Recent Changes

8

0

2000

4000

6000

8000

10000

12000

14000

16000

18000

2004 2015 2030

Other renewables

Biomass and waste

Hydro

Nuclear

Gas

Oil

Coal

1. Medium Energy Demand and Supply ForecastI – 1 – a: Worldwide Primary Energy Supplies

・Worldwide primary energy supply will increase at an annual rate of 1.6% from 2004-2030 ・Dependence on fossil fuels will remain high: approximately 80% through 2030 ・Nuclear power and renewable energy still have potential for growth

10%

33%

26%

2%2%

23%

5%

Share in 2030

9

0

2000

4000

6000

8000

10000

12000

14000

2004 2015 2030

World

Asia + Australia & NZ

China

India

Japan

・ Asia’s share will be increase from 40% in 2004 to 50% in 2030

・ China’s share of Asian energy demand will reach 40%, while India will constitute 13% of

demand

Source：IEA World Energy Outlook 2006

Japan China India Other developing Asia

Forecast DemandProportional Structure of

Demand

12% 9% 7%

37% 39% 40%

14% 13% 13%

37% 39% 40%

0%

25%

50%

75%

100%

2004 2015 2030

I – 1 – b: Forecast of Energy Demand in the world & Asia

40%50%

Asia’s Share

10

I – 2 – a: Worldwide Oil Demand

Source：BP Statistical Review of World Energy June 2006

・United States consumes a stunning 25% of oil production ・China accounts for 1/3 of worldwide increase in oil demand over the last 5 year period.

2. Demand, Supply, and Price of Oil

US 25%

India 3.0%

Japan 6.4%China 8.5%

EU18%

Shift in Oil Demand　　　　　　　　　 Increment of Oil Demand in 2000-2005(World total demand in 2005: 3.9 billion tons)

US China India Japan EU World-50

0

50

100

150

200

250

300

350In million ton

0

200

400

600

800

1,000

1965

1970

1975

1980

1985

1990

1995

2000

2005 Year

Million tons Million tons Incremental Oil Demand, 2000-2005

11

0

10

20

30

40

50

60

70

80

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

I – 2 – b: Shifts in Oil Prices

Oil prices (WTI*) of about $20/barrel in the 1990s increased to $68/barrel in 2007 and $63/barrel now.

*WTI: West Texas Intermediate

*Source: US Department of Energy

$63

(US$)

12

I – 2 – c: Impact of Previous Oil Crises on Japanese Economy

Japan has experienced two oil crises in the past: ・First oil crisis led to drastic consumer price increases (~24%) and economic contraction ・Second oil crisis again resulted in consumer prices (~8%) and economic slowdown ・Both crises resulted in major social and economic disruptions

1st Oil Crisis

2nd Oil Crisis

Source: System of National Accounts, Cabinet Office/ Consumer Price Index, Ministry of Public Management

（％）

-5

0

5

10

15

20

25

30

1970

1971

1972

1973

1974

1975

1976

1977

1978

1979

1980

1981

1982

1983

1984

1985

Consumer Price IndexActual GDP Growth

13

3. “Oil Peak” is real? North Sea Oil & Gas Production at the DTI’ｓ Report

Gas

Oil

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

4.5

5.0

1967 1970 1973 1976 1979 1982 1985 1988 1991 1994 1997 2000 2003 2006 2009 2012 2015 2018

Oil

Equiva

lent

(m

mbo

e/da

y)

Gas - Possible

Oil - PossibleGas - 2P

Oil - 2P

Already produced Future production

14

Key to reducing CO2 emissions is development and dissemination of technology

○　Development and dissemination of technology is key to sustainable economic development and reducing CO2 emissions

○　Specifically, key technologies to be developed and disseminated are related to: 　・　energy conservation 　・　new energy resources 　・　nuclear power

○　Despite ample reserves, development of technology to cleanly and efficiently use coal is required due to coal’s environmental impact

○　International collaboration, such as Asia-Pacific Partnership for Clean Development and Climate (APP), is required for technology development, dissemination, and transfer 　・　Countries responsible for CO2 emission reductions under Kyoto Protocol emit only about 30% of total emissions; CO2 emission reductions by United States and developing countries are also essential

4. Importance of Technology to Reduce CO2 Emissions

15

5. Energy Strategies of Major CountriesI – 5 – a: United States of America

・Promoting development of new oil exploration to avoid crisis atmosphere arising from dependency on foreign oil. ・In addition to various measures, including oil alternative energy development already being implemented, greater enthusiasm and determination at federal government level may be required. ・Different views between federal and state governments, concerned officials, and sectors.

○　Domestic oil development is being promoted in Gulf of Mexico and Alaska to reduce dependence on imported oil, especially from Middle East. Development is encountering opposition due to environmental concerns.

○　To reduce dependency on oil, United States has a plan to promote variety of energy sources, including coal, photovoltaic, and wind, to achieve objective of diversifying energy supplies. However, few specific policies exist to support this.

○　Bioethanol production is being promoted as a measure for transportation sector, which is responsible for about 40% of US energy consumption. Half of all vehicles sold get unfavorable gas mileage, such as SUVs. However, no regulations have been implemented to address this situation.

○　Discord between federal and state governments regarding approaches to global warming have become prominent. - Twelve state governments, including California, have established targets for greenhouse gas emission reductions. However, the federal government opposes such measures at a national level.

References: The White House, The Economist, Financial Times, the State of California, Pew Center on Global Climate Change

16

I – 5 – b: Potential Impact of Improving Gas Mileage in the United States

・ Half of vehicles sold in US in last five years are “gas guzzlers,” getting just 3-4 km/L. ・ Raising fuel efficiency of US motor vehicles to European levels would save 4 million barrels of oil per day. ・ Savings would be equivalent to daily production volume of Iran, third largest producer in the world.

Daily production volume of Iran, third largest oil producer in the world

Expected energy conservation effect:

4 million barrels per day

What if the average gas mileage of US vehicles (7 km/L) were improvedto match those of European vehicles (13 km/L)?

Reference：Financial Times

17

I – 5 – c: EU

References: The Economist, the British Government

・Introduction of non-fossil fuels has progressed significantly. ・Anxious about being heavily dependent on gas imports from Russia. ・Trend of mergers and acquisition among energy companies amid integration and expansion of markets is meeting with objections from member states

○　Introduction of fossil fuel alternatives has progressed significantly. - Photovoltaic power and wind power are being actively introduced in Germany. 　・Cumulative photovoltaic power generation installed capacity increased by a factor of 12.5 in the period 2000 – 2005 (114MW to 1429MW) 　・Wind power produces 26.5 billion kWh (2005) or 4.3% of total national electricity generation - UK is revaluating nuclear power. There was a proposal to install a nuclear power plant in 2005 for first time in 17 years.

○　Anxious about dependency on Russian gas imports - Production levels of Russian gas, on which EU is heavily dependent, have been problematic. 　　　Level of dependency on Russia is 100% in Finland, 43% in Germany, 30% in Italy, 26% in France. - In addition, recent increase in price of gas sold to Ukraine and Belarus has intensified concerns.

○　Energy companies intend to unite in attempt to deregulate energy markets in July 2007. - Germany’s E.ON’s action to acquire Spanish electric company Endesa 　　　Spanish government, considering necessity of large nationwide company, opposed merger plan and submitted 19 conditions. - French government initiated merger of its electric company, Suez, and gas company, GDF. 　　　Concern over possible takeover by an Italian company in the offing.

18

Part II　Importance of Energy Conservation and New Energy

19

II – 1 – a: Projects in Japan1. Significance of Energy Conservation in Japan

○　Since oil crises, Japan has responded with regulatory measures and technological developments and has made some significant achievements.

○　From regulatory perspective, Japan implemented mandatory periodic reports of energy consumption by factories and mandatory oil stockpiling (Current oil reserves – government: 91 days/private sector: 83 days)

○　Below projects were implemented through industry-academic-government collaboration under governmental direction, within well established structure 　　・　Sunshine Project (as of 1974) 　　　　　R&D of oil alternative technology, including new energy 　　・　Moonlight Project (as of 1978) 　　　　　 R&D of energy conservation technology

○　These projects resulted in drastic reduction of dependency on oil and progress in energy conservation, especially the industrial sector, which has achieved the world’s highest energy efficiency levels.

○　Projects are still underway that focus especially on consumer and transportation sectors, where potential for reduction is even greater than industrial sector.

20

II – 2 – a: Shifts in Energy Consumption by Sector

Source: Energy Whitepaper 2006, Agency for Resources and Energy

・ Oil crises spurred industrial sector towards major progress in energy conservation ・Consumer and transportation sectors have not kept up with industrial sector

16

2. Energy Conservation

0

2

4

6

8

10

12

14

16

18

1965 1970 1975 1980 1985 1990 1995 2000

0

100

200

300

400

500

（Actual GDP：in trillion JPY）（Final Energy Consumption：10　J）

Year

Transportation~ 24%

Consumer~ 31%

Industrial~ 45%

Actual GDP 526 trillion JPY

1stOil Crisis

2ndOil Crisis

Gulf Crisis

~ 24%

~ 22%

~ 26%

~ 50%

~ 21%

~ 57%

~ 16%

~ 67%

~ 17%

21

II – 2 – b: Change in Basic Energy Consumption Unit in Japan by Sector

Source: Energy and Economic Survey Digest, Energy Conservation Center

・Oil crises spurred industrial sector towards major progress in energy conservation ・Basic energy consumption unit reduced 40% in industrial sector as a whole over last 30 years

40

50

60

70

80

90

100

110

120

1973 1978 1983 1988 1993 1998 2003

ManufacturingSteelChemicalsCeramic/Soil and StonesPaper/PulpMetal/Machinery

(1973 = 100)

22

II – 2 – c: Examples of Energy Conservation by Technology

・In cement industry, technology was developed to produce a chemical reaction of raw materials before injecting them into cement kiln, resulting in major energy savings (60% reduction in basic energy consumption unit over 20 years)

・Automotive sector improved gas mileage by 20% over seven years through improved engine technology, light-weighting of chassis, and other improvements.

Change in Fuel Basic unit for Industrial Cement　　　　　Change in Average Gas Mileage of Passenger Vehicles

Source: Japan Cement Association/ Japan Automobile Manufacturers Association, Inc.

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

9,000

1950

1955

1960

1965

1970

1975

1980

1985

1990

1995

2000

（MJ/t）

10

11

12

13

14

15

16

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

（km/L）

Target value for 2010: 15.1km/L

Change in Basic Energy Consumption Unit for Cement Industry

23

II – 2 – d: Impact of Energy Conservation Efforts

Japan created and is currently implementing energy conservation programs that will save the equivalent of 56 million kilolitres of oil in the industrial, civilian, and transportation sectors, pursuant to the Kyoto Protocol.

Reference: Energy Conservation Center, Energy and Economic Survey Digest, IEE

Sector Energy Conservation （Crude Oil

Equivalent: in million kL）

Oil Tanker Equivalent（260,000 ton class）

Standard Nuclear Power Plant Equivalent

Relative to Amount of Imported Crude Oil in

2004

Industrial 21 74.7 29.3 8.6％

Consumer 17.4 61.9 24.3 7.2％

Transportation 17.3 61.5 24.1 7.2％

Total 56 198.1 77.7 23.0％

Impact of Energy Conservation by 2010 (compared to 1996)

Note: For the purposes of this calculation, a standard nuclear power plant is estimated to produce 1.1 million kW of output, and to be online 80% of the time.

24

　①　NEDO developed LED lighting devices that consume one-eighth the electricity of incandescent lighting devices, and half the electricity fluorescent lighting devices do. They are now in use in traffic signals nationwide.

　②　A cooling system made with a thermoelectric element called a “Peltier Device” was developed and used as a cooling system in personal computers and wine cellars because of its quiet operation and energy saving characteristics. 　

③　About 320 out of 8000 existing industrial furnaces are high performance industrial furnaces with an energy conservation effect exceeding 30%.

II – 2 – e: Economic and Environmental Benefits○　Energy conservation projects are advantageous in economically and environmentally, including

the conservation of energy resources, the stabilization of energy prices, the reduction of environmental burdens (CO2, etc.), and the offsetting of climate change effects.

○　Furthermore, even though capital investments, which do not directly improve productivity in the short-term, are necessary to implement energy conservation projects, these investments do improve productivity, enhanced competitive strength, and create new technology and new businesses in the longer term.

Examples of New Technologies and Business Creation

25

II – 2 – f: Energy Management of Factories under the Energy Conservation Law

The Energy Conservation Law enforces comprehensive energy management by mandating obligations to factories, including: 　　・periodic reports regarding energy consumption 　　・preparation of mid- to long-term plans to achieve objectives 　　・appointment of energy manager

・Appointment of energy management officer

・Preparation/Submission of periodic reports・Appointment of energy manager

（Energy manager certification*）

・Preparation/Submission of periodic reports

・ Preparation/Submission of medium- to long-range plan *There are about 86,000 certification holders nationwide, as of Mar. 2006.

Factories with significant energy consumptionFactories with significant energy consumption(Class I energy management designated plant)(Class I energy management designated plant)

・Annual fuel (heat) usage: 3000 kL crude oil equivalent or more

・Annual electricity usage: 12 million kWh or more

・ Annual fuel (heat) usage: 1500 kL crude oil equivalent or more

・ Annual electricity usage: 6 million kWh or more

Factories with moderate energy consumptionFactories with moderate energy consumption(Class II energy management designated plant)(Class II energy management designated plant)

MeasuresMeasures

26

II – 2 – g: Improvement in Efficiency of Products under Energy Conservation Law (1)

- The top runner program* was introduced in 1998 for energy conservation standards for home/office appliances and fuel economy standard for automotives.

Energy-Conservation Target for Specific Equipment

Energy conservation effects in comparison with FY2000（against FY1999 figures for transformers）

* * Top Runner Program:Top Runner Program:The program seeks continuous improvement in The program seeks continuous improvement in energy conservation standard/performance energy conservation standard/performance among the latest products. E.g. Fuel economy among the latest products. E.g. Fuel economy standard of automobile, energy conservation standard of automobile, energy conservation standard for electric equipment etc.standard for electric equipment etc.

Example of Top Runner ProgramTarget Year Energy conservation effects

Passenger vehicles (diesel) 2005 15%

Freight vehicles (gasoline) 2010 13%

Freight vehicles (diesel) 2005 7%

Air conditioners (cooling & heating) 2004 (Partly 2007) 63%

Air conditioners (cooling only) 2007 14%

TV sets 2003 16%

Video cassette recorders 2003 59%

Fluorescent lights 2005 17%

Copying machines 2006 30%

Computers 2005 83%

Magnetic disc units 2005 78%

Electric refrigerators / freezers 2004 30%

2010Passenger vehicles(Gasoline and LP gas)

Gasoline 23%LP gas 11.4%

Space heaters 2006 (Gas)1%/(Oil)4%Gas cooking appliances 2006 14%Gas water heaters 2006 4%Oil water heaters 2006 4%Electric toilet seats 2006 10%Vending machines 2005 34%Transformers 2006 (Partly 2007) 30%

27

II – 2 – h: Improvement in Efficiency of Products under Energy Conservation Law (2)

Labeling of energy conserving products

・Product’s Top Runner Standard achievement is displayed with labels.・Consumer-oriented labels indicate energy conservation performance of products to assist them in selecting products.

Reference: Energy Conservation Center, Japan

Products subject to this program include air conditioners, refrigerators, deep freezers, fluorescent lighting equipment, televisions, heaters, gas cooking appliances, and water heaters.

←Green mark for products fulfilling

Top Runner Standard

← Orange mark for products not fulfilling Top Runner Standard

28

II – 2 – i: Examples of Successful Technology Development and Introduction by NEDO (1)

・High Performance Industrial Furnace refers to a type of industrial furnace with an energy conservation effect exceeding 30%. ・Among 8000 existing installed furnaces, 320 High Performance Industrial Furnaces have already been installed. ・NEDO supported the introduction of 224, or 70%, of the 320 High Performance Industrial Furnaces installed. ・The installed High Performance Industrial Furnaces have resulted in a cumulative energy conservation effect of 188,000 kL.

Development of High Performance Industrial Furnace

1993-1997

Field Test for High Performance Industrial Furnace Introduction

1998-2000

R&D Field TestIntroduction/Promotion

Support Project for Industries for Increasing the Efficient Use of

Energy 2001-

International Energy Conservation Model Project

R&D of High Temperature Air Combustion Control Technology

1999-2003

Collaboration R&D, field testing, introduction and promotion

R&D

Source: NEDO

NEDO’s High Performance Industrial Furnace Project

29

II – 2 – j: Examples of Successful Technology Development and Introduction by NEDO (2)

Project Term

Subsidy Rate

Subsidy history and energy conservation volume

Subsidizing 1/3 of construction costs (or costs for additions or renovations)

1999-ongoing

Residential homes FY2005 Cumulative

Number of subsidized structures ９０１ ４８３３

Energy conservation effect（Based on declared information (oil

equivalent）６０１ ２７４０

Photovoltaic Power GenerationOr Solar Thermal Utilization

High-Efficiency Air-Conditioning System

or

Central Air-Conditioning System

Well-sealed/wellinsulated specifications

Hot Water Supply for Bathroom

Radiant Floor Heating

High Efficiency Hot Water Supply

Source: NEDO

Promotion of energy efficiency in residential buildings, which can reduce consumption about 15% for new homes and 25% for existing structures compared to energy consumed by conventional houses, by combining enhancements such as photovoltaic power generation, high-efficiency insulation, high- efficiency air-conditioners, high-efficiency water heaters, etc.

High-Efficiency Air-conditionerOr Central Air-Conditioning System

30

II – 2 – k: Examples of Successful Technology Development and Introduction by NEDO (3)

- Use IT technology to promote and facilitate a system that supports the energy demand management for commercial buildings (e.g., a system that ensures recognizing a real-time room conditions in buildings by temperature sensors and/or the optimal operation of lighting and air-conditioning responding to the room condition).

Human Detective Sensor

Detects human presence/absence in each floor/room and send the information data to the central monitoring & controlling unit.

Humidity & Temperature Sensor

Based on the data from the humidity & temperature sensor and human detective sensor, adequately controls air conditioning and lighting.

Aggregates and analyzes the energy use data and estimates the future energy demand to reflect for the air-conditioning control.

Measures humidity & temperature in each floor/room and send the information data to the central monitoring & controlling unit.

BEMS Image

Equipment Control

Central Monitoring & Controlling Unit

Controls the blowing volume of air-conditioners upon direction received from the central monitoring and controlling unit.

Thorough Energy Management Utilizing IT Thorough Energy Management Utilizing IT Promotion of Commercial Building Energy Management System (BEMS)Promotion of Commercial Building Energy Management System (BEMS)

31

II – 3 – a: Impact of New Energy

Reference: Energy Economy August 2006, IEE

Type of New EnergyNew Energy Volume （Oil Equivalent: in

million kL）

Oil Tanker Equivalent （260,000 ton class）

Standard Nuclear Power Unit Equivalent

Relative to Amount of Imported Crude

Oil in 2004

Photovoltaic Power Generation 3.6 13 5.0 1.5%

Wind Power Generation 2.3 8.1 3.2 1.0%

Industrial Waste Power Generation 3 10.9 4.2 1.2%

Biomass Power Generation 0.5 1.7 0.7 0.2%

Solar Thermal Utilization 0.3 1 0.4 0.1%

Industrial Waste Thermal Utilization 1.7 6 2.4 0.7%

Biomass Thermal Utilization 0.9 3.1 1.3 0.4%

Untapped Energy 0.2 0.6 0.3 0.1%

Total 12.5 44.5 17.4 5.2%

New Energy Generation in 2030

New energy volume in 2030 will be equivalent to power output of 17 standard nuclear power plants

Note: For the purposes of this calculation, a standard nuclear power plant is estimated to produce 1.1 million kW of output, and to be online 80% of the time.

3. New Energy

32

II – 3 – b: Photovoltaic Power Generation Cost in Japan

12090 80 70 65 65 63 59 52 48 45 44

367

200

143117 103 102 96 87 79 73 68 65

0

100

200

300

400

500

600

1974 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004

太陽光発電システム価格[万円/kW]

0

500

1000

1500

2000

2500

3000

その他

米国

ドイツ

日本

システム価格

モジュール価格

日本1,132MW

(44%)

ドイツ794MW(31%)

米国365MW(14%)

太陽

光発

電シ

ステ

ム累

積設

置容

量[MW]

2,000

Other countries

U.S.A.

Germany

Japan

System Price

Module Price

Pho

tovo

ltaic

Pow

er G

ener

atio

n Sy

stem

Pric

e [T

en T

hous

and

Yen

/kW

]

Cum

ulat

ive

Inst

alle

d P

V S

yste

m C

apac

ity [M

W]

U.S.A.

Germany

Japan

33

II – 3 – c: Micro Grid Demonstration Project with PV in Japan

Ota City

substation

(4kW×510 houses) (Dec. 2003- )

34

II – 3 – d: New Energy: Biomass

Representative Example

Budget (FY2006) Approx. 4.0 billion yen Project Period 2005 to 2009

Operational Entity: Yamaguchi Prefecture, Energy Supplied: 3,300kl/Year Crude Oil EquivalentObjective: A social system in which energy will be locally produced and consumed by developing and introducing three complex energy utilization systems: gasification cogeneration, heat (cold) generation from wood pellets and boilers, and coal and biomass co-firing in an existing coal-fired plant, as well as a low-cost collection and transportation system for forest biomass.

Number of Projects Executed

Food Waste Collection System

Used Cooking Oil Collection System

Led by Municipalities

Collection/ Transportation

・Woody Biomass・Used Cooking Oil ・Food Waste and Livestock Waste

・Heat Production・Liquid, Gaseous Fuels　(Thermal Decomposition　 Gasification, Fermentation)

・ Gas Cogeneration・ Used in Public Fleets・ Heat Use, Electric Facilities

Companies/Municipalities

Energy Conversion

Fermentation

Linkage

Consumed Mainly within Municipalities

Energy Utilization

Electricity Used at Public Facilities

Linkage

Gasification plus Composition

Gasification Reactor

Com

posing R

eactor

35

II – 3 – e: Distributed Systems Including Solar and Biomass

Combine multiple new energy technologies with Japan’s own excellent systematic and integrated technology to establish a distributed energy supply system. Demonstrative experiment was conducted at Aichi EXPO and it stably supplied power to Japanese Government Pavilion and other buildings. (About 5% of all power supplied at the EXPO.)

NEDO Pavilion

High temperature gasification system　(Capacity: 20kg/hr)

Photovoltaic system

（330kW in total）

Methane fermentation system(Capacity: 4.8 tons/day)

NaS battery(500kW: I/O capacity)

Fuel cell (MCFC)（270kW×1 unit, 300kW×1 unit）

Fuel cell (SOFC)（25kW×1 unit）

Fuel cell (PAFC)（200kW×4 units）

Total supply capacity2,225kW

　Control room (energy control

system)

Source: NEDO

36

混合槽 （ｱﾙｶﾘ処理）

破砕 ﾎﾟﾝﾌﾟ

反応槽 （バイオガス化）

精製 ＭＣＦＣ

排水処理

水： 7.2 m 3 / 日 NaOH ： 20kg/ 日

破砕・分別

生ごみ等 4800 kg/ 日

バイオガス 1015 Nm 3 / 日

水： 76 m 3 / 日 脱水ｹｰｷ 2100 kg/ 日

放流水 91 m 3 / 日

Planned SpecificationsCapacity 4.8t/day

Gas Production Rate Approx. 40m3N/ｈMethane Concentration of

Produced Gas Approx. 60%

Fuel cell (MCFC)（270kW×1 , 300kW×1）　　　　 87 tons of food waste (57.5% of total food waste, equivalent to the amount for 12.67 million visitors) was used as biomass resources.

Garbage, etc.800 kg/day

(Alkaline Treatment)

Dewatering Cake2100 kg/day

Separation, Crushing

Mixing Barrel Reaction Barrel(Biomass Gasification)

Crushing Pump

Refining

Wastewater Treatment

Water: 7.2 m3/dayNAOH: 20 kg/day

Water: 76 m3/day

Discharged Water 91 m3/day

Biogas1015 Nm3/day

37

Part III　

Way to the World Tech. Bank for Energy and Environment

38

0

2

4

6

8

10

28

??? ?? ?? ???? ??? ?? ??

III – 1 – a: Comparison of Primary Energy Supply per GDP

Source: IEA “Key World Energy Statistics 2006”

Since Ukraine uses 28 times more energy per GDP dollar than Japan, there is a significant opportunity for energy conservation technology.

（石

油換

算ト

ン／

千ド

ル）

Primary energy supply per GDP in different countries

Ukraine China U.S.A France Germany UK Japan

Tons

of o

il eq

uiva

lent

/ 1,

000

dolla

rs =

1. Possibility in the world

39

III – 1 – b: Potential for Energy Conservation: Industrial Sector

For Ex, It is expected that crude steel production in India will reach 100 million tons by 2020. If all 25 coke ovens* required for that production were outfitted with energy-efficient Coke Dry Quenching (CDQ) technology, annual energy savings would total 1.35 million tons of oil equivalent per year.

CDQ

×25 units＝Expected energy savings:

About 1.35 million tons, oil equivalent(7.29 million barrels of oil)

*1.20 million tons of coke/year

40

III – 1 – c: Changes in CO2 Emissions in G7　　

80

85

90

95

100

105

110

115

120

1990 1995 1997 1998 1999 2010

Rat

io（％

）

JapanUSA

CanadaUK

GermanyFranceItaly

41

III – 1 – d: Japan’s Strategies for the Kyoto Target:6% GHG Reduction!

2000

+10%

CO2 from non-energy,

methane, N2 O

- 0.5%

HFCs, PFCs,

SF6

Technology R&D, lifestyle change

Sinks-3.9%

Commitment - 6%

CO2 from energy use

Kyoto Mechanisms

last resort

BAU 2010

+ 2%- 2%

- 1.6%

1990 level 1990 level

42

2. Framework for CooperationIII – 2 – a: Potential means of cooperation between Japan and Ukraine

○　As shown below, fossil fuel import and production will decrease in the future.

Ukraine: 6.92kgCO2/2000$, Japan: 0.25 doUkraine: 6.92kgCO2/2000$, Japan: 0.25 do○　Given this, the development and introduction of energy conservation and new

energy technologies should be viewed as an opportunity for cooperation, not competition, and as the common responsibility of all nations.

○　JI with Japanese industries may increase the possibility.

○　Japan has led the world in this field for more than 30 years and has confidence based on that experience. Japan would like to actively cooperate.

○　Japan co-organized the “Japan-India Energy Forum” with India in December 2006. In addition, a cabinet-level Japan-India energy policy dialogue will start in the future.

○　The importance of the partnership between Ukraine and Japan will continue to grow. It is important to establish a win-win relationship.

43

Results of “India Japan Energy Forum” “India Japan Energy Forum” Agenda

“India Japan Energy Forum,” the first public-private forum between India and Japan, and co-organized by The Energy Resources Institute (TERI) and NEDO, was a success. Date and location:

Date: December 6-7, 2006 Location: New Delhi

Participants: more than 300 Indian side: relevant ministries (Planning Commission, Ministry of Power, Ministry of New and Renewable Energy, Ministry of Petroleum and Natural Gas and others), relevant organizations/companies, etc. Japanese side: METI, Embassy of Japan, NEDO, energy related organizations/companies, etc.

Inaugural session

Session 1: Overview of energy policies in India and Japan; Experience sharing

Session 2: Policy on energy efficiency and cross cutting approach for energy efficiency in industries

Session 3: Energy efficiency efforts in industry

Session 4: Technology status and development trends in renewable energy sector

Session 5: Introduction of activities for coal and petroleum/natural gas sectors

Session 6: Introduction of activities for the electric power sector

Closing Session: The way forward; cooperation opportunities

- Japan Energy Forum in India -

44

Fuel （Natural

Gas）

Fuel （Natural

Gas） SteamturbinesSteamturbines

Power generation

boilers

Power generation

boilers

Hot water boilers

Hot water boilers

Thermal Thermal

Power Power

1 2 2 .

Heat Recovery Steam Generation

Heat Recovery Steam Generation

Gas TurbineGas Turbine

Current condition

Model Project

　Annual CO2 emissions in baseline case 192,000　t-CO2 /yAnnual CO2 emissions in project case 　130,000 t-CO2 /y 　　

Annual Emissions Reduction 62,000t-CO2 /y

Fuel flowHeat Power

III – 2 – b: The Model Project with Industries

Co-Generation Project in KazakhstanKazakhstan with NEDO & Tohoku Electric Power Co.

45

CDQ Project in China and India with NEDO & Nippon Steel Co.

Cooling chamber　

Generator

Heat recovery boiler

Conveyor

Fan

Dust collectorSteam produced

Cokes basket

Steam turbine

ＨＰ ＬＰ

Extracted steam

Cokes

Heated cokes

Copy Rights; Nippon SteelCopy Rights; Nippon Steel

46

PV Power Supply Project in Mongolia with NEDO & Sharp Co.

Power plant : 100kW

Hospital : 40kWVillage office : 10kW

Communication center : 10kW

School : 40kW

Noyon Soum, Mongolia

PV: 200kWPower Distribution:

Hospital / Communication Center:24hrs/day 128 Households:16 hrs/day

47

PV panels

Electricity

Electricity

Electricity

Electricity

Micro-hydro power generator

BatteriesMicro-hydro power generator

Micro-hydro: 41.2kWPV1 : 30kWPV2-6 : 7.5kW

Power distribution:200 households, 6 hrs/day21

PV Power Supply Project with Micro-hidro in Cambodia

PV Power Supply Project with Micro-hidro in Cambodia

48

Latin America 13

Middle East Africa　23

(9%)

Mongolia 1

South West Asia 14

Tonga 1

Eastern & Central Europe 55(21%)

China 47(18%)

ASEAN 59(23%)

260 F/S47 Countries

Central Asia17

Russia 30(12%)

III – 2 – c : Implementing F/S on CDM/JI1998-2005 : 260 F/S in 47 countries

49

*CDM/JIProject Activity

Japanese Private Sector Firms

NEDO

（Necessary cost A ）・Equipment introduction・Validation

・Certification・Verification

Etc.

Subsidy: maximum ½ or all of necessary cost

*Eligibility: Non- AnnexⅠ& AnnexⅠ Countries

Ministry of Economy, Trade and Industry (METI)

III – 2 – d: Subsidy for CDM/JI by NEDOFeasibility Studies:10/10, Project:5/10

50

Outline of the CTIOutline of the CTIAustria, Canada, Finland, Germany,Austria, Canada, Finland, Germany,

Norway, UK, USA, Japan and KoreaNorway, UK, USA, Japan and Korea

Chair : Mr.Holts/US.DOEVice Chair : Mr.Masunaga/METI,JAPAN,

Ms.Amin/UK.DEFRA P.Manager : Prof.Kurushima

Seminars and Symposia Technology Needs AssessmentsTraining CoursesInformation DisseminationWorking with UNFCCC/EGTT, UNIDO, UNDP etc.

51

CTI

Mauritius Gov.

SADAC S.African D. Bank

Preliminary Study

Basic Survey FS/Project Formation

Industry

Project Implementation

NRELUS-DOE

NEDOJapan

With Gov, International Org, Bank and Industry With Gov, International Org, Bank and Industry for Energy & Environmentfor Energy & Environment””

52

NEDO

Gov. /Gov.Org.

Bank

Coordination

Basic SurveyFS/Project Formation

Industry

Project Implementation

Academia/Univ.

NEDO is considering to establishNEDO is considering to establish““Coordinator for Energy & EnvironmentCoordinator for Energy & Environment””

53

PV R&D Scenario for 2010For Our Common FutureFor Our Common FutureFor Our Common Future

Gov. Initiative with 3Players for 3E

Sustainable Sustainable SocietySociety

Energy

Environment Economy

Industry

Academia

Financial

NEDO Offices and I should be waiting for you.

HeadquartersHeadquarters

WashingtonWashington

ParisParis

BangkokBangkok

BeijingBeijing

JakartaJakarta

New Energy and Industrial Technology Development Organization (NEDO) TEL:+81-44-520-5190, FAX:+81-44-520-5193