Systems Analysis of Biomass Energy Market in Japan

Transcription

Information Seminar “Bioenergy in Japan”, 3rd November, 2015
Systems Analysis of Biomass Energy
Market in Japan
Hiroshi Hamasaki, PhD
Senior Research Fellow
Economic Research Centre, Fujitsu Research Institute
[email protected]
Copyright 2015 FUJITSU RESEACH INSTITUTE
Fujitsu Research Institute (FRI)
 Research & Consulting Company of Fujitsu Group
 15 Economists & 380 Consultants
 Area
 Business Strategy in Renewable Energy
 R&D Strategy on Energy Related Technology
 Investment Strategy
HQ if FRI in Tokyo
 Clients
 Oil Companies
 Manufacturing Companies
 New Entrants to Japanese Energy Market
 Government
 International Organisation
 Methodologies
 Quantitative Analysis
 Technology Model
 Economic Model
1
EXAMPLE: IRENA REMAP Project
 REMAP Project is to make policy
proposals to governments to double
global renewable energy shares.
 IRENA (International Renewable Energy
Agency） is handling the
 As a member of IEA-ETSAP（Energy
Technology System Analysis Program）,
I have been involved in the project.
2
Copyright 2014 FUJITSU RESEARCH INSTITUTE
Presentation Structure
I. Current Biomass Market in Japan
II. Complexity of Renewable Energy Market Forecasts
III. Complex Energy Model –
Japan Multi-regional Transmission (JMRT) Model
IV. Systems Analysis Approach (Uncertainties & Biomass)



FIT Design
Future of Nuclear Power
Energy Infrastructure
V. Concluding Remarks
3
I. CURRENT BIOMASS MARKET
IN JAPAN
4
Renewable Energy in Japan
(million kWh)
33.8%/yr
FIT
Begins
9.4%/yr
9.4%/yr
9.7%/yr
year
Source: Agency for Natural Resources and Energy, http://www.enecho.meti.go.jp/category/saving_and_new/saiene/
5
Biomass is still a minor player…
 Generation and Payment Under FIT, April, 2015
Generated Electricity
10 Thousand kWh
Biomass
FIT Payment
%
100 million JPY
%
36,451
10.7%
77
6.3%
243,104
71.6%
1,005
82.4%
Wind
45,635
13.4%
101
8.3%
Hydro
13,973
4.1%
36
3.0%
218
0.1%
1
0.1%
PV
Geothermal
6
…But expected to be a big player.
2013
Share of REs
2030
22
-24%
10.7%
Biomass
(16.1 - 20% in REs)
(3.7 - 4.6% in Total)
REs
PV
(30.4% in REs)
(7.0% in Total)
Wind
(7.4% in REs)
(1.7% in Total)
FIT budget will be some 40
billion US$ in 2030.
7
FIT Price
(JPY/kWh)
2012
PV
Wind
2013
2014
2015
Less than 10kW
42
38
37
33
More than 10kW
40(31)
36
32
27 (21)
Onshore Wind (Less than 20kW)
55
55
55
55
Onshore Wind (More than 20kW)
22
22
22
22
36
36
Offshore Wind
-
-
Less than 15,000kW
40
40
40
40
More than 15,000kW
26
26
26
26
Less than 200kW
34
34
34
34
200kW - 1,000kW
29
29
29
29
1,000kW - 30,000kW
24
24
24
24
Methane Gas
39
39
39
39
Forest Thinnings (Less than 2,000kW)
32
32
32 (25)
40 (31)
Forest Thinnings (More than 2,000kW)
Biomass Woody Biomass and Agricultural
Residue
Building Material Waste
32
32
32
32
24
24
24
24
13
13
13
13
17
17
17
17
Geothermal
Hydro
Others
*VAT exclusive
*Euro cents
8
Biomass under FIT
(10 thousand kW)
9
Japan’s Abundant Biomass Stock
• Japan is a biomass stock rich country compared to Germany.
Japan
Germany
Sweden
Forest Land
(thousand ha)
25,000
10,000
23,000
Forest Stock
(billion m3)
6.0
3.4
3.0
Annual Stock
Growth
(thousand m3)
<180,000
125,000
100,000
Timber
Production
(thousand m3)
>20,000
50,000-60,000
62,000
Source: Kajiyama (2015)
10
II. COMPLEXITY OF
RENEWABLE ENERGY
FORECASTS
11
Old Energy System
Oil Field
Power Station
Refinery
Petroleum
Station
Electricity
Grid
Consumer
Oil
Electricity
12
Renewables Era Energy System
Oil Field
Renewables
Petroleum
Energy
Station
Storage
Refinery
Thermal
Nuclear
Automobile
Refinery, Steel etc.
H2
Fuel Cell
Brown Coal
Renewables
Sewage
Hydrogen Station
13
FCV
Japan Multi-regional Transmission (JMRT) Model
III. INTEGRATED ENERGY
MODEL
14
Still Back of Envelope Calculations?
 Competition between Technologies
 Each technology has independent characteristics.
 All assumptions are exogenously given.
Onshore Wind
Discount Rate
5%
Capacity (kW)
 Energy Demand Forecast
20,000
But...My Approach is more20%
than that!!
Availability Factor
Life Time
20 Years
Construction
3,000energy
US$/kW demand, P is
where Q is the total
the price of1.4%
energy
and Y is the GDP of the
of Construction
country.
Capital Cost Tax
Disposal Cost
5% of Construction
Source: Dahl (1994)
O&M
Labour & Maintenace
1.4% of Construction
Other
0.6% of Construction
Administration
14% of Primary Cost
15
Energy Model which Reflects “Complexity”
 Using the Japan Multi-regional Transmission (JMRT) developed by FRI, I
input detailed biomass energy system into the model and ran simulations.
 I developed a detailed energy technology model using TIMES, which is also
widely used by IEA, the British government, and the EU.
 TIMES simulates the combination of technologies which give the highest
cost-performance within an energy system.
 i.e., it calculates the optimal technological combination for an ideal society.
 I referred to “NEDO Fuel Cell & Hydrogen Technology Development Road
Map”, “Hydrogen Road Map”, IEA-ETSAP Energy Technology Database,
and other academic journals for information on the current state and future of
hydrogen technologies.
 Goals of the model:
1.
Market forecasting: merits of entering a market; resiliency of business model
2.
3.
4.
Investment strategy: infrastructure investment in pipelines, connector lines
R&D strategy: what are goals of R&D (performance or cost)?
Policy evaluation: how big will a given market become given current policies?
16
Prefecture Level Resolution
• Detail energy system by prefecture
• Reflect regional characteristics
Coal
LNG
Oil
Sankey
17
Energy Demand Curve
By inputting actual energy consumption patterns, we see variance by time of day and season.
 Daily Time Periods
 Seasonal Periods
 Middle （8～13hr、16～23hr）
 Spring （March～June）
 Summer （July～September）
 Peak （14～15hr）
 Off-Peak （0～7hr）
 Autumn （October～December）
 Winter （January～February）
Daily Electricity Load（10 thousand kW)
Peak Load （10 thousand kW）
※Y2014, TEPCO
※1st August, 2014, TEPCO
18
Potential of Renewables
• 1km2 Mesh Renewable Potential Data
• Each mesh point has unique data
including investment, availability
factor.
• Reflects existing infrastructure,
electricity grid and roads.
Onshore Wind
Offshore Wind
Geothermal
Road
REs
GridPotential
source: Ministry of the Environment, Japan
19
Potential of Renewables
(Geographic Information System)
No. Prefecture Lat. Long.
Wind
speed
1
2
1 km
mesh
3
Enormous onshore wind
potential
Geothermal
Offshore Wind
Onshore Wind
Large center of
electricity consumption
GIS Data is from MOE Potential Survey
20
Reflecting Regionality (Using GIS)
Onshore Wind
Offshore Wind
Road
Electricity Grid
21
Effect of Regionality on Renewables
Grid Construction
More than 20,000V
http://www.gsi.go.jp/KIDS/
map-sign-tizukigou-h0702-01soudensen.htm
Road
Construction
Wind Speed
Wind Speed
(m/s)
Availability Factor
AF
(%)
5.5
15.8%
6
19.7%
6.5
23.5%
7
27.3%
7.5
31.0%
8
34.5%
8.5
37.9%
Sea Depth
Capital
22
Biomass Potential by Category
Unused Materials
Wood Biomass
Agricultural Residue
Waste Resources
Wood Biomass,
Forestry Residue
Orchard Prunings
Wood Biomass,
Castoff Trimmings
Bamboo
Rice Growing Residue:
Rice Straw
Rice Growing Residue:
Rice Chaff
Straw
Other Agricultural Residue
Herbaceous Biomass
Bamboo Grass
Silver Grass
Wood Biomass
Domestic Sawmill Scraps
Groundbreaking/Enlargement
Construction Scraps
Foreign Sawmill Scraps
Park Prunings
Construction Scraps
Livestock Excreta
and Sludge
Foodstuff Biomass
Dairy Cow Excreta
Broiler
Beef Cattle Excreta
Sewage Sludge (cocentrated)
Pig Excreta
Human Waste & Septic Tank
Overflow Sludge
Egg Hen Excreta
Village Effluent Sludge
Food Processing Waste
Industrial Kitchen Waste
Household Kitchen Waste
Source: NEDO
23
IV. SYSTEMS ANALYSIS
APPROACH
24
Uncertainty: Future of Nuclear
 Operational (2 Plant)
Plant
Sendai 1, 2
 Decommissioned Plants (15 Plants)
Plant
Fukushima Daiichi 1-6
Tokai
Hamaoka 1, 2
Mihama 1, 2
Tsuruga 1
Shimane 1
Genkai 1
 Under Construction (3 Plants)
Plant
Ohma
Kaminoseki 1
Kaminoseki 2
capacity (GW)
1.38
1.37
1.37
Start
2021?
2018?
2022?
 Under Inspection (42 Plants)
25
Uncertainty: Infrastructure
Electricity Grid
• Japan has 10 electricity grids with limited
capacity for trading electricity between grids.
• Japanese government announced it would
consider doubling grid connection capacity
between Tohoku and Tokyo.
Hydrogen Trading
• Japanese government unveiled “The Strategic
Road Map for Hydrogen and Fuel Cells” in 2014.
26
Uncertainty: Feed-in-Tariff (FIT) Design
（ｋWh/JPY)
2015
2030
less than 10kW
33
?
more than 10kW
27
?
55
?
22
?
Offshore Wind
36
?
Less than 15,000kW
40
?
More than 15,000kW
26
?
Less than 200kW
34
?
200kW - 1,000kW
29
?
1,000kW - 30,000kW
24
?
Methane Gas
39
40
Residue
32
PV
Wind
Geothermal
Hydro
Others
27
FIT Price
FIT Budgets
?
?
?
24
?
13
?
17
?
Impacts of FIT Price
FIT Rate (%)
FIT Budget
(billion USD)
0
10
20
0
30
40
30
50
35
60
70
80
90
100
40
Nuclear
No
Yes
Energy
Trading
No
Yes
 FIT price is assumed to
decrease continuously to a
given premium rate.
FIT Premium
 FIT budget will be fixed to
avoid high electricity prices.
Avoidable Cost
28
Renewables under Varied Budgets in 2030
RE Generation (TWh)
277.7TWh
FIT Budget
(billion US$)
64.7TWh
 There is an inverted Ushaped relationship
between FIT price and
Renewable Energy under
FIT budget constraints.
 If FIT price is constant,
RE will be introduced up
to half of its maximum
possible introduction.
144.4TWh
128.3TWh
115.3TWh
% of 2015 FIT Premium in 2030
29
Feed-in-Tariff (FIT) will be…
（ｋWh/JPY)
2015
2030
less than 10kW
33
19.2
more than 10kW
27
16.8
55
28
22
14.8
Offshore Wind
36
20.4
Less than 15,000kW
40
22
More than 15,000kW
26
16.4
Less than 200kW
34
19.6
200kW - 1,000kW
29
17.6
1,000kW - 30,000kW
24
15.6
Methane Gas
39
40
Residue
32
PV
Wind
Geothermal
Hydro
Others
30
21.6
22
18.8
24
15.6
13
11.2
17
12.8
Renewable Energy in 2030
% FIT Premium
31
Biomass Energy in 2030
Biomass Type
Abbr.
Forest
Forest
Woody Biomass and Agricultural Residue
Others
Wood_Agri
Building
Others
% FIT Premium
32
FIT Payment for Biomass in 2030
% FIT Premium
33
Biomass Energy by Prefecture in 2030
2.2 TWh
Hokkaido & Tohoku
34
Impact of Nuclear Power Plants
FIT Rate (%)
FIT Budget
(billion USD)
0
10
20
0
30
40
30
50
35
60
70
90
100
40
Nuclear
No
Yes
Energy
Trading
No
Yes
35
80
Electricity Generation by Type
No Nuclear
Nuclear
(TWh)
(TWh)
(TWh)
Biomass
Coal
Geothermal
Hydro
LNG
Nuclear
Oil
PV
Wind
No Nuclear
23.6
251.0
3.8
90.1
551.0
0.0
0.3
0.0
109.1
2020
Nuclear
23.9
251.0
3.5
89.8
391.0
176.0
0.4
0.0
109.2
Diff.
-0.3
0.0
0.4
0.3
160.0
-176.0
-0.1
0.0
-0.1
36
No Nuclear
24.6
257.0
5.4
92.3
503.0
0.0
0.2
85.1
133.0
2030
Nuclear
24.9
257.0
5.5
90.4
417.0
110.0
0.2
82.0
123.0
Diff.
-0.3
0.0
-0.2
1.9
86.0
-110.0
0.0
3.1
10.0
Electricity Generation in 2030
• Current FIT design and budget can meet government goals for renewable energy.
• Some structure difference
• Biomass share will be half of Japanese government’s target.
• Japanese government aims to keep the share of wind at 1.7%.
• It is unrealistic to keep the share of nuclear at 20-22%.
• Japanese government needs additional policy measures to double biomass share
by 2030.
Gov Plan
Nuclear
No Nuclear
Nuclear
20-22%
0.0%
9.9%
Coal
26%
23.4%
23.2%
LNG
27%
45.7%
37.6%
3%
0.0%
0.0%
22-24%
30.9%
29.4%
Geothermal
1.0-1.1%
0.5%
0.5%
Biomass
3.7-4.6%
2.2%
2.2%
Wind
1.7%
12.1%
11.1%
PV
7%
7.7%
7.4%
Hydro
8.8-9.2%
8.4%
8.1%
Oil
Renewables
37
Impact of Grid Expansion
FIT Rate (%)
FIT Budget
(billion USD)
0
10
20
0
30
40
30
50
35
60
70
90
100
40
Nuclear
No
Yes
Energy
Trading
No
Yes
38
80
Electricity Generation by Type
No GE
GE
(TWh)
(TWh)
(TWh)
Biomass
Coal
Geothermal
Hydro
LNG
Nuclear
Oil
PV
Wind
No GE
23.6
250.8
3.8
90.1
551.1
0
0.3
0.0
109.1
2020
GE
Diff.
22.4
250.8
5.0
89.5
550.7
0
0.1
0.0
109.7
1.2
0.0
-1.2
0.6
0.5
0.0
0.2
0.0
-0.6
39
No GE
24.6
257.1
5.3
92.3
503.1
0
0.2
85.1
133.2
2030
GE
24.5
257.1
5.5
90.8
499.9
0
0.0
84.7
139.7
Diff.
0.2
0.0
-0.1
1.5
3.2
0.0
0.2
0.4
-6.5
Other Government Support
Ministry
Ministry of Economy,
Trade and Industry
(METI)
Ministry of the
Environment (MOE)
Title
Budget (billion JPY)
FY2016 FY2015
Description
7
Subsidies to 1) heat utilisation
equipment using wood biomass,
earth thermal and snow ice, 2) wood
biomass electricity generation and
PV for own use and 3) electricity
battery to promote renewable
energy utilisation at regional level.
Subsidies to Regional
Renewable Energy
Company
Experimental Project
on Independent
Regional Energy
System using Biomass
Energy
Sustainable Biomasee
Energy Introduction
Plan
-
Building Technical Gudline and
condition on commercially viable
0.5
biomass and model project based
on the guidline.
1.05
0.4
Regional Cycle Type of
Bio-gas Project
0.55
Promotion to
Industrialise Regional
Ministry of
Agricultural, Forestry Biomass
and Fishery (MAFF) Widening Wood
Biomass Utiisation
40
Support to local government to
make a sustainable biomass energy
plan in the region.
-
0.8
Biogass project using cattle
manture, food and fishery waste.
0.9
0.8 Support to biomass equipment.
0.6
0.5
Support to widen biomass
utilisation
V. Concluding Remarks
 To maximise renewables, the FIT premiums will decrease to 40% of 2015
level in 2030.
 Under these assumptions, biomass electricity market is expected to be
1.44billion US$ in 2030.
 To avoid instability in the electricity system due to the increase of
intermittent renewables, Japanese government is aiming for 3.7-4.6%
biomass electricity in 2030, but under current policies the share will be
2.2% in 2030.
 Japanese government should/will implement the following policy measures:
 Make biomass competitive against other renewables by differentiating FIT price
 Control the introduction of wind turbines through FIT price adjustment and/or
upper limits on introduction into system.
 Expand biomass financial support.
 Make biomass-generated heat subject to FIT.
41
Some difficulties biomass faces
 To use subsidies from Japanese government, mainly
Japanese companies products are employed.
 Japanese companies electricity generator is too big capacity.
• Several hundreds MW
 Japanese customers tend to introduce too big capacity compared to the
supply of biomass.
 Japanese government is thinking about to introduce carbon
emission/energy efficiency regulation to coal power station（
etc. CO2 emission/kWh)
 After the earthquake, coal played some role to offset the shortage of
electricity supply.
 Biomass might be used to decrease the carbon intensities of coal power
station.
 As a result, biomass price will increase sharply which makes biomass
only power station become less competitive.
42
Biomass 2 Hydrogen (Fukuoka-city)
Offsite Hydrogen
Station
Onsite Hydrogen
Station
Greenhouse
Sewage Treatment
Back-up Power
Source: Fukuoka City
43
Copyright 2015 FUJITSU RESEACH
INSTITUTE
44

Systems Analysis of Biomass Energy Market in Japan

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