Energy Efficiency in Japan 9789812307422

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Energy Efficiency in Japan

The Institute of Southeast Asian Studies (ISEAS) was established as an autonomous organization in 1968. It is a regional centre dedicated to the study of socio-political, security and economic trends and developments in Southeast Asia and its wider geostrategic and economic environment. The Institute’s research programmes are the Regional Economic Studies (RES, including ASEAN and APEC), Regional Strategic and Political Studies (RSPS), and Regional Social and Cultural Studies (RSCS). ISEAS Publishing, an established academic press, has issued almost 2,000 books and journals. It is the largest scholarly publisher of research about Southeast Asia from within the region. ISEAS Publishing works with many other academic and trade publishers and distributors to disseminate important research and analyses from and about Southeast Asia to the rest of the world.

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Energy Efficiency in Japan EDITED BY

AGUNG WICAKSONO

I5ER5 INSTITUTE OF SOUTHEAST ASIAN STUDIES

First published in Singapore in 2008 by ISEAS Publishing Institute of Southeast Asian Studies 30 Heng Mui Keng Terrace Pasir Panjang Singapore 119614 E-mail: [email protected] Website: http://bookshop.iseas.edu.sg All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, without the prior permission of the Institute of Southeast Asian Studies. © 2008 Institute of Southeast Asian Studies, Singapore The responsibility for facts and opinions in this publication rests exclusively with the authors and their interpretations do not necessarily reflect the views or the policy of the publisher or its supporters. ISEAS Library Cataloguing-in-Publication Data Energy efficiency in Japan / edited by Agung Wicaksono. (ISEAS energy series) 1. Energy policy—Japan. 2. Energy conservation—Japan. I. Wicaksono, Agung. II. Series HD9502 J32E57 2008 ISBN 978-981-230-741-5 (hard cover) ISBN 978-981-230-742-2 (PDF) Typeset by Superskill Graphics Pte Ltd Printed in Singapore by Photoplates Pte Ltd

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Contents Foreword

vii

The Contributors

ix

1.

2.

Energy Efficiency and New Technology: Challenges and Problems on Exporting Japanese Energy Saving Technologies Makoto Nishimura and Ram Giri Energy Efficiency and Conservation Policies and Measures in Japan Yasushi Akahoshi

21

89

Index

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Foreword This book about Japan’s efforts on energy efficiency is part of the ISEAS Energy Series. The issue of energy efficiency has become one of the most important aspects in the global energy outlook today. The depletion of fossil fuels as energy resources as well as global warming as factors in global socio-economic development make it imperative for us to consider energy efficiency policies and measures as one of the most important priorities for policy-makers and every responsible global citizen. Japan has been a leading country in the area of ener gy efficiency. Since the 1970s when the oil crisis hit, Japan, which depends almost wholly on imported energy supplies from abroad, has been conducting various efforts on energy conservation and diversification of ener gy sources. As a result, Japan has achieved the lowest primary ener gy consumption per GDP in the world. Asian countries should learn from Japan’ s success in this area, especially since their economic growth is predicted to be one of the primary drivers for growth in global ener gy demand. The chapters in this book are based on presentations on Japan’s energy efficiency and conservation at ISEAS Energy Forums on two separate occasions. Professor Makoto Nishimura, former Executive Vice-President of the Mitsui Global Strategic Studies Institute Japan, and now an economic s professor at the Nagoya University ,

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viii

Foreword

presented a paper on energy efficiency and new technology from the private business perspective, at the ISEAS Energy Forum on 7 March 2007. Together with Dr Ram Giri, Project Manager of the Mitsui Global Strategic Studies Institute (MGSSI), he addressed the challenges and problems on exporting Japanese ener gy saving technologies. Mr Yasushi Akahoshi, Executive Director of the Japanese External Trade Organization (JETRO) Singapore, which is the Japanese government agency dealing with cooperation in foreign trade, also wrote a chapter on the policy aspects of Japanese energy efficiency and conservation. This was based on his presentation at the ISEAS Energy Forum on 14 March 2007. We thank Professor Nishimura, Dr Giri and MrAkahoshi for their contributions to the ISEAS Energy Programme, as well as for sharing the experience of Japan’ s success in energy efficiency and conservation. We hope that this book will contribute to a greater understanding of Japan’s success in the increasingly important field of ener gy efficiency. I also would like to thank Mark Hong for coordinating the ISEAS Energy Programme and Agung Wicaksono for editing this book. K. Kesavapany Director, Institute of Southeast Asian Studies July 2007

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The Contributors Yasushi Akahoshi is with the Japan External Trade Organization (JETRO) in Singapore. He was seconded from the Ministry of Economy, Trade and Industry (METI), Japan. As a representative of METI and JETRO, his responsibility extends to regional issues, such as the ASEAN-Japan relationship and economic cooperation, and integration in the East Asia. Ram Giri is Project Manager of the Mitsui Global Strategic Studies Institute (MGSSI). After graduating from the Department of Electrical and Electronic Engineering at Muroran Institute of Technology in Japan, he pursued a master and doctoral course at the same university . He obtained his Ph.D. in 2005. Since then, he has been working at the MGSSI in the fields of energy saving, development of new business models, innovation of new technology , and new business areas including universities and private companies. Makoto Nishimura has been a Professor at Nagoya University in Japan since April 2007. He was formerly Deputy Director of Mitsui Global Strategic Studies Institute (MGSSI). After graduating from the Faculty of Science and Technology, Kyoto University, he joined Mitsui and Co. Ltd in 1973. Since then, he has been working in the

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x

The Contributors

petrochemical field, developing new business models, marketing products and was involved in new plant projects worldwide. He had also served as a member of Senior Management of Mitsui & Co. (USA), Inc., in Houston, USA.

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Energy Efficiency and New Technology

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1 Energy Efficiency and New Technology: Challenges and Problems in Exporting Japanese Energy Saving Technologies Makoto Nishimura and Ram Giri

At the Second East Asia Summit held in Cebu, Philippines on 14–15 January 2007, Japanese Prime Minister Shinzo Abe announced Japan’s intention to provide Japanese energy saving technologies to help Asian nations achieve efficiency in energy use and to reduce greenhouse gas emissions. The Prime Minister announced a US$2 billion aid package to help Asian nations develop energy saving technologies that can help to decrease the region’s dependence on oil. He also invited researchers and Japanese experts to come on board. These commitments from the Prime Minister himself show that Japan has highly ef ficient energy saving technologies and is commited to spread such technologies to other parts of the world. Before the “Oil Shock” hit Japan in 1973, the general view is that energy resources, especially oil, will not run out

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Makoto Nishimura and Ram Giri

of supply. In that year, a brief but serious panic occurred in Japan. The manufacturing of detergent and toilet paper had to be halted, and about half of the elevators in buildings had to be stopped to reduce ener gy usage. Television stations ceased their broadcasting at midnight, and car usage had to be decreased to save petrol. The year 1973 saw the dawn of ener gy conservation in Japan. Since then, many products, especially automobiles and household appliances, could only be sold if they have been proven to be energy saving (shoo-ene). Energy saving features are not restricted to general consumer products only but also to manufacturing facilities, transportation machines, houses, and buildings. Many Japanese products are now considered as a small package of ener gy saving technologies. Energy efficiency in Japan has improved by more than 37 per cent in the last thirty years (see Figure 1.1), and it has become the most energy-efficient country in the world.1 The Japanese Government has targeted a further energy conservation by 30 per cent in the next ten years (see Figure 1.2). Energy efficiency in the United States is half that of Japan, and in China it is is only one-ninth that of Japan (see Figure 1.3).2 If the whole world achieves the same level of energy efficiency as Japan, global oil consumption would go down by between one-third to half of 84 million barrels per day in 2005. At this rate, the peak out of oil reserves would be delayed by forty years, with a possibility to further extend it by another forty to eighty years. In the United States, a paradigm shift named “Katrina Shock” occurred in 2006. The shift occurred thirty years after it happened in Japan since the U.S. ener gy selfsufficiency rate is 63 per cent. The ratio in Japan is only 4 per cent. 3 See Figure 1.4.

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1,438 1,405 1,327

1,467

Improvement by 37% 1,192 1,131 1,142 1,091 1,101 1,060 1,071 1,055 1,059 1,030 1,101 1,086 1,037 1,064 1,055 1,041 1,059 1,050 1,0361,021 982 989

1,273

1,345

Fiscal Year

3 4 5 6 7 8 9 0 1 2 3 4 5 6 7 8 9 0 1 2 3 4 5 6 7 8 9 0 1 2 ’7 ’7 ’7 ’7 ’7 ’7 ’7 ’8 ’8 ’8 ’8 ’8 ’8 ’8 ’8 ’8 ’8 ’9 ’9 ’9 ’9 ’9 ’9 ’9 ’9 ’9 ’9 ’0 ’0 ’0

1,556

1,573

Source: Ministry of Economy, Trade and Industry (METI) Japan, General Ener gy Statistics.

900

1,000

1,100

1,200

1,300

1,400

1,500

1,600

1,700

Ton oil eq./Billion yen

FIGURE 1.1 Primary Energy Consumption per GDP, from 1973

Energy Efficiency and New Technology 3

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Y/2003

100 70

30% improvement

(Target for) Y/2030

37% improvement

Final Energy consumption per GDP

Y/1973

159

Note: Year 2030 is the further improvement tar get. Source: Ministry of Economy, Trade and Industry (METI), Japan.

0

20

40

60

80

100

120

140

160

180

FIGURE 1.2 Improvement of Primary Energy Consumption/GDP in Japan

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1.0

EU

1.7

Note: The figure for Japan is set at 1. Source: IEA. Energy balance 2006.

0

5

10

15

20

U.S

2.0

Korea

3.2

Canada

3.2

Thailand

6.0

Middle East Asia

6.0

China

8.7

India

9.2

FIGURE 1.3 Primary Energy Consumption/GDP (Tons in oil equivalent)

Russia

18 .0

Energy Efficiency and New Technology 5

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Italy

15%

Japan

4%

(16%)

Germany

26%

(39%)

France

8%

(50%)

Source: Energy Balances of OECD Countries 2002–2003, IEA.

0%

20%

40%

60%

80%

100%

120%

140%

160%

US

63%

(72%)

UK

96%

(106%)

140%

(148%)

Canada

FIGURE 1.4 Energy Self-Sufficiency of Major Countries, 2003

6 Makoto Nishimura and Ram Giri

Energy Efficiency and New Technology

7

In his 2007 State of the Union Address, U.S. President George W. Bush appealed for the introduction of sustainable energy and energy conservation. Among others, President Bush set a goal for reusable and alternative fuel production that is significantly higher than the goal set in the Ener gy Policy Act of 2005. However, it is believed that the United States is biased towards the production of biomass ethanol because of the following reasons: 1. to increase ener gy production in the country from an energy security perspective; 2. to execute its agricultural policy by providing incentives to farmers in the corn belt who support the Republican Party; 3. to promote automobiles that use biomass ethanol, which are produced by the Big Three automobile makers, in order to counter Japanese hybrid automobiles; and 4. to cope with the difficulty of constructing new gasoline refineries. It costs approximately US$20 billion to construct one new refinery, and the gasoline yield is only 50 per cent. In 1981, there were 325 refineries in the United States, and they produced 18 million barrels per day . In 2005, the number of refineries was only 148, which produced 17 million barrels per day (see Figure 1.5). 4 In terms of energy efficiency, developing a new energy source is equivalent to improving energy efficiency by energy conservation. It is comparable to making money through fund management, which is equivalent to returning a debt

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Source: IEEJ, 2006.

0

2

4

6

8

1950 1955 1960

N o. O f R efin erie s

12 10

E ffic ie ncy

C apacity

Refineries

14

Million B/D

16

18

20

Capacity

1965 1970 1975

1980

1985

1990

Efficiency

1995

2000

2005

0

50

100

Efficiency%

150

200

250

300

350

No. of Refineries

Capacity

FIGURE 1.5 Statistical Summary of U.S. Oil Refinery (Numbers Capacity and Efficiency)

8 Makoto Nishimura and Ram Giri

Energy Efficiency and New Technology

9

and saving on the interest. However, people are more eager to create something out of nothing than to reduce something that is non-existent. For example, if the United States is concerned about ener gy security, they should encourage raising the temperature of air conditioners slightly or introduce car pooling. The wasteful consumption of energy by the United States and the increasing demand for ener gy in countries such as China and India will have a big impact on the world’s energy security. Many agree that Japanese ener gy conservation technologies should be made available to the whole world. However, there are significant issues to be addressed. First, energy conservation technologies that are established as products, such as hybrid cars, can be made available by producing, exporting and selling those car overseas. However, the hybrid car technology is an exception as most Japanese energy conservation technologies have not been commercialized. In addition, lar ge energy-conservation technologies are closely integrated to production technologies. In order to transfer the ener gy conservation technologies, the production technologies need to be transferred as well. There is a strong concern that transferring the production technologies would affect the competitiveness of Japanese companies. Therefore, energy conservation technologies need to be separated from production technologies. There are some ener gy conservation technologies that have been separated from production technologies and have been successfully commercialized, but the number is still very small. The English proverb “Rome was not built in a day” applies to Japanese ener gy saving technologies. These technologies come about from many years of improvements and experience.

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An example of a Japanese energy saving technology in the production field is the well-known “Kanban” process. The Kanban process does not require stocking of goods but directly assembles more than 3,000 parts delivered just in time with precise inventory control. For some Japanese companies, there is an of ficial rule that a group of five members must submit an improvement proposal involving energy saving to their higher management every month; for a group of ten members the requirement is once every three months; and once a year for a group of thirty members. If their proposal is selected, the whole group including their family members are awarded with attractive incentives including overseas trips. The author had personally received such incentive when he was with a manufacturing company in the late 1980s. A group of thirty members had proposed an in-house ener gy-saving technique. In the system there were three spots to produce steam and eleven spots to use steam. The proposal was to reduce the steam-using stations from eleven to six and to reduce the distance of each station from the steam-producing station. After changing to the new layout, the company managed to save energy by 30 per cent by reducing heat loss and pump power consumption. When their proposal was selected, the thirty team members, including their families, were awarded with a two-week trip to Hawaii. This is an example of how Japanese manufacturing industries are promoting energy saving technology in each level of activity. Other than in manufacturing, many other Japanese industries have been developing their own inhouse energy saving technologies, which are the most efficient in the world. The strong support from the Japanese

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Energy Efficiency and New Technology

11

Government has also promoted research and development (R&D) of these technologies. The government not only makes the policy but also provides financial support to newly developed ener gy saving technology . Almost all machineries and household appliances in Japan meet energy consumption efficiency standards. There are three standard value systems: (1) minimum standard; (2) average standard; and (3) maximum standard, also called “T op Runner Standard”. In other parts of the world, the minimum standard value system is the most popular standard. But in Japan, the maximum standard value system is the common standard. Another example of ener gy saving can be found at a metal wire manufacturing company . This company has reduced 37 per cent of its yearly ener gy consumption5 by controlling the circulation of cooling water , using highefficiency motors, adjusting the pressure of compressors, using high-efficiency lamps, reducing the number of lamps, adding sensors, and controlling the ventilation system. As mentioned earlier , the Japanese Government has targeted a further energy conservation by 30 per cent in the next ten years. To achieve this target, Japan has to focus on the energy consumption in of fice buildings. Nearly 80 per cent of the total ener gy consumption are from air conditioning, lightings and sockets. Many new ener gy saving technologies are being developed in order to reduce energy consumption in office buildings. For example, JFE Engineering Company has developed the clathrate hydrated slurry air conditioning system, which is capable of conserving energy in air conditioning systems (see Figure 1.6).6 The developed clathrate hydrate has latent heat over the temperature range of 5 to 12 degrees Celsius, and a

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Source: Ogoshi and Takao (2004).

FIGURE 1.6 Air-Conditioning System Using Clathrate Hydrate Slurry

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Energy Efficiency and New Technology

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mixture of clathrate hydrate and aqueous solution (referred to as hydrate slurry) has greater cooling capacity compared with cold water . The utilization of hydrate slurry in air conditioning system is expected to reduce the consumption of pumping power substantially . This technology was originally developed as an in-house energy saving technology at a steel factory . It can be utilized to cut down power consumption of air conditioning by a maximum of 40 per cent. This technology has been introduced in Southeast Asia. An office building near Changi Airport in Singapore is experimenting the use of this new technology . The second reason for the dif ficulty in transferring Japanese energy conservation technology overseas lies in the countries receiving the technology . There are various hurdles, such as regulations, customs, and the attitude towards energy conservation. For example, in Singapore, there is a tendency to set the air conditioning in of fices to very low temperature. This leads to over-cooling the office environment. Even though the ener gy effectiveness of hydrated slurry has been proven, using the new technology involves investment in new plant and equipment. Needless to say, the investment could be easily recouped in a few years from lower power consumption and lower electric bills. However, building owners are not interested in new investment and additional construction work. As mentioned above, transferring Japanese energy conservation technology overseas requires an understanding about ener gy conservation by the countries and companies that receive those technologies. Therefore, a change of attitude towards energy conservation and engineering to physically introduce the energy conservation technology is required.

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The third issue is who is to be financially responsible for energy conservation technologies. This issue is related to the issue of attitude. In the case of buildings, it is dif ficult to determine who benefits from energy conservation technologies — the owner or the tenants. It creates a dilemma when the payer cannot be ascertained. As has been shown above, it is not easy to transfer Japanese energy conservation technologies overseas. Nevertheless, some methods are under development. One such method is the Smart Of fice Environment System. 7 This system makes it possible for lights and air conditioning, which consume the most power in a building, to evolve from a dumb centralized system to an autonomously dispersed intelligent system. This newgeneration system conserves energy significantly, provides comfort to those in the building, and enhance of fice productivity (see Figure 1.7). It is a breakthrough system, considering the three effects of the system. In the Smart Of fice Environment System, a microchip that controls brightness is embedded into adjustable fluorescent lights and/or LED lights that are used in a building. Those working in the building will each be given a card-type photometer that contains information about their preference on the brightness of the lights. They can adjust the brightness by putting the card on their desk. The photometer controls the brightness of fluorescent and LED lights by detecting light coming out from computer displays and light coming in from windows. As a result, 40 to 50 per cent of electricity saving is possible. The control of air conditioning works on the same principle, but it achieves “personal air conditioning” by utilizing floor heating and an air conditioning system that is similar to a car air conditioner .

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Source: Miki et al. (2004).

700 lx, 23

450 lx

550 lx

700 lx

400 lx

650 lx

+

Light

Personal Light, Personal Air-conditioning

Light, Temperature

Intelligent Lighting System

18

25 22

20

24

Temperature

FIGURE 1.7 Intelligent Lighting and Cooling System

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Incidentally, while doing research on the system it was found that air conditioning has more to do with perception than performance (see Figure 1.8). Coolness is felt when a person’s face feels cool, and he feels warm when his back and feet are warm. Even though the output of a car air conditioner is very small, coolness is felt in a car because cool air blows directly to the face. Using the same reasoning, a person will feel relatively warm if his back and feet are warm, even though his face is cold. This finding may not come as a surprise, but it that has bearing on the performance of air conditioning system. The reason that air conditioning in buildings may not feel cold even if it is set at 25 degrees Celsius is because it cools the feet, not faces. About 50 per cent of cold air that controls the temperature of a whole building to 25 degree Celsius is used to cool down ducts. The same principle applies to heating. Warm air is used to warm up ducts and ceiling, and people only get to enjoy the remaining warm air. With the Smart Of fice Environment System technology, those working in offices will experience optimum conditions with their preferred lighting and temperature levels. Changeable colour of lighting and slight breeze with air conditioning are also being developed. With these independently adjustable features, people will be able to work in more comfortable environment. This will lead to less stress and increased productivity.8 In other words, added value is created. Significant ener gy conservation can be achieved with the technology, but the challenge lies in selling the technology with added value as a sales point and consequently creating a business model to materialize ener gy conservation. If successful,

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Ambient Zone

Source: Tanabe Shin-Ichi, “Productivity and Future HVAC”, Clima 2005 Lausanne, 8th REHVA World Congress, Switzerland, 9–12 October 2005.

Task Zone

FIGURE 1.8 Task Ambient Air-conditioning System

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transferring energy conservation technologies will become easier. Energy efficiency is something that cannot be achieved by just looking at the numbers but has to be thought of as adding new values. Notes 1. 2. 3. 4. 5. 6.

7.

8.

Ministry of Economy, Trade and Industry (METI) Japan, General energy statistics, 2006. International Energy Agency (IEA), Energy balance, 2006. Energy balances of OECD countries 2002–2003, IEA. The Institute of Energy Economics, Japan (IEEJ), 2006. Energy Saving Centre Japan (ECCJ), April 2006. Hidemasa Ogoshi and Shingo Takao, “Air-Conditioning System Using Clathrate Hydrate Slurry”, JFE Engineering Technical Paper, No. 3, pp. 1–5 (March 2004) (in Japanese). Mitsunori Miki et al., “Proposal for an Intelligent Lighting System, and Verification of Control Method Effectiveness”, Proceeding of the 2004 IEEE Conference on Cybernetics and Intelligent Systems (CIS), 2004, pp. 520–25. Shin-Ichi Tanabe, “Productivity and Future HVAC”, Clima 2005 Lausanne, 8th REHVA World Congress, Switzerland, 9–12 October 2005; Shin-Ichi Tanabe, Naoe Nishihara, and Masaoki Haneda, “Productivity with Indoor Thermal Environment”, The Society of Heating Airconditioning and Sanitary Engineers of Japan, Technical Papers Collections, Nagano, Japan (27–29 September 2006), pp. 159–62 (in Japanese).

References Miki, Mitsunori, et al. “Proposal for an Intelligent Lighting System, and Verification of Control Method Effectiveness”,

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Proceeding of the 2004 IEEE Conference on Cybernetics and Intelligent Systems (CIS), 2004, pp. 520–25. Ogoshi, Hidemasa and Shingo Takao. “Air-Conditioning System Using Clathrate Hydrate Slurry”. JFE EngineeringTechnical Paper, No. 3 (in Japanese), pp. 1–5 (March 2004). Tanabe, Shin-Ichi. “Productivity and Future HV AC”, Clima 2005 Lausanne, 8th REHVA World Congress, Switzerland, 9–12 October 2005. ———, Naoe Nishihara, and Masaoki Haneda. “Productivity with Indoor Thermal Environment”. The Society of Heating Airconditioning and Sanitary Engineers of Japan, Technical Papers Collections (in Japanese), Nagano, Japan, pp. 159– 62 (27–29 September 2006).

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Energy Efficiency, Conservation Policies and Measures in Japan 21

2 Energy Efficiency and Conservation Policies and Measures in Japan Yasushi Akahoshi

Introduction In previous years, the situation regarding regional economic cooperation and integration has been developing actively. One tangible development was the East Asia Summit (EAS), a 16 member-country cooperation. Two EASs or leaders’ meetings have been held, in Kuala Lumpur in 2005, and in Cebu, Philippine in early 2007. The Third EAS leaders’ meeting will take place in November 2007 in Singapore. There are several issues that the leaders have decided as possible fields for cooperation. Ener gy issues have been regarded as the most important, as shown in the EAS leaders declaration entitled “Cebu Declaration on East Asian Energy Security”. Singapore has been one of the most active countries for energy cooperation, and has proposed to host the First East Asia Energy Ministers Meeting, a move welcomed by the other leaders. This paper discusses the policy side of Japanese energy efficiency and conservation. Chapter 1 by Makoto Nishimura,

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Executive Vice-President of the Mitsui Global Strategic Studies Institute, Japan, is on ener gy efficiency from a private business perspective. This paper is divided into three parts. The first part examines the situation on ener gy consumption in Japan as a brief background. The second part discusses ener gy conservation policies and measures. International cooperation for energy efficiency is discussed in the final part. The material for this chapter was mainly contributed by colleagues in Tokyo. Therefore, credits go to the Agency for Natural Resources and Ener gy of the Ministry of Economy, Trade and Industry (METI). The Present Energy Consumption in Japan Figure 2.1 compares ener gy consumption in three sectors from 1973 onwards, when the first oil shock took place. The figures in the second column indicate the amount of energy consumption in each sector , with the amount in 1973 taken as 100. The figure shows that the ener gy consumption in the commercial and residential sector and the transportation sector has been steadily increasing, as indicated by the number 247 and 212 respectively.Meanwhile, the industrial sector’s indicator has been almost flat. This does not mean that the ener gy conservation effort has been conducted only in the industrial sector . Energy efficiency in the other two sectors has been improving on an individual equipment base, while the impact of the increase of the quantity of equipment, such as automobiles and air-conditioners, has significant effect much beyond the compensation of such ef fort. Various factors might have

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100

100

100

100

189

177

171

92

FY1990

Note: GDP is real GDP based on 1995 prices according to 93SNA. Source: Energy Balance Tables in Japan, Annual Report on National Accounts.

(Reference) GDP

Transportation sector

Commercial/ residential sector

Industrial sector

FY1973

221

212

247

99

FY2004

Transition of Final Energy Consumption (1)

FIGURE 2.1 Japan’s Final Energy Consumption by Sector

Energy Efficiency, Conservation Policies and Measures in Japan 23

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Yasushi Akahoshi

affected the levelling of energy consumption in the industrial sector, such as the recent recession in the Japanese economy. Nonetheless, credit should be given to the industrial sector for making a tremendous ef fort in energy conservation. Figures 2.2 and 2.3 show a more detailed breakdown of the statistics shown in Figure 2.1. Figure 2.4 compares the ener gy consumption in some countries. Japan has the world’ s lowest primary ener gy consumption per GDP. The figure shows that countries such as Russia, India, and China have much room for improving their energy efficiency, and as well as other countries in ASEAN, which would af fect the overall economic performance. The figure for Singapore is not shown in this chart, but it is 2.3. TABLE 2.1 Diversification of Energy Sources in Japan after Oil Crises (In percentages)

Oil Coal Natural gas Nuclear

1973

2005

77.4 15.5 1.5 0.6

48.9 20.5 13.8 11.3

Table 2.1 shows that after the oil crises, Japan, which depends almost wholly on imported ener gy supplies from abroad, has not only taken steps to conserve energy, but has also diversified its ener gy sources, promotes the use of

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25

Real GDP

Industrial sector

Commercial/residential sector

Transportation sector

44.9%

31.0%

24.1%

Fiscal Year

0

100

200

300

400

500

600

Trillion yen

1973 1974 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004

65.5%

18.1%

16.4%

287 million kl

414 million kl

Transition of Japan's final energy consumption and real GDP

Note: Due to revision of the aggregation method in Energy Balance Tables in Japan, values for FY1990 onwards and values for preceding years are the results of utilizing dif ferent methods. Source: Energy Balance Tables in Japan, Annual Report on National Accounts.

0

50

100

150

200

250

300

350

400

450

Million Kl in crude oil equivalent

FIGURE 2.2 Transition of Japan’s Final Energy Consumption and Real GDP Energy Efficiency, Conservation Policies and Measures in Japan 25

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98.9

212.5

Transportation Sector

Commercial/ Residential Sector

Fiscal Year

Industrial Sector

246.8

73 974 975 976 977 978 979 980 981 982 983 984 985 986 987 988 989 990 991 992 993 994 995 996 997 998 999 000 001 002 003 004 1 1 1 1 1 2 2 2 2 1 2 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1

19

Source: Energy Balance Tables in Japan, Annual Report on National Accounts.

0.0

50.0

100.0

150.0

200.0

250.0

300.0

Index (FY1973=100)

FIGURE 2.3 Transition of Japan’s Energy Consumption by Sector

26 Yasushi Akahoshi

02 Energy Efficiency Ch 2

27

Japan EU U.S.

2.0 1.0 1.7

2/26/08, 2:46 PM

Korea Canada Thailand Middle Indonesia China East

3.2 3.2

6.0 6.0

India

9.2 8.1 8.7

Russia

18.0

Note: Primary energy consumption (tons in oil equivalent/GDP) indicated in the ratio when the Japanese figure is set at 1. Source: IEA Energy Balance 2006.

Source: IEA Energy Balance 2004

0.0

5.0

10.0

15.0

20.0

FIGURE 2.4 Primary Energy Consumption per GDP Energy Efficiency, Conservation Policies and Measures in Japan 27

28

Yasushi Akahoshi

renewable energy, and has been stockpiling crude oil. As a result, dependency on oil has decreased from around 77 per cent in 1973 to 49 per cent in 2005, while share of other energies have increased in the same period, such as natural gas from 2 to 14 per cent, and nuclear from 1 to 11 per cent. Looking at the statistics in Figure 2.5, one of the efforts made after the oil crises was to reduce the dependency on the Middle East. However , that dependency , which had once declined, had increased again from the 1990s when domestic consumption in former oil exporting countries like China and Indonesia began to rise. Figure 2.6 shows the breakdown on trend of ener gy consumption in Japan in the industrial sector . As noted earlier, the energy consumption in the industrial sector has been generally steady since the oil crises. The major contributing factor has been the improving ener gy consumption intensity per index of Industrial Production for the manufacturing industry. Even though this intensity has been increasing slightly, Japan’s figure is much lower than other developed countries, as is shown in Figure 2.7. On the other hand, the ener gy consumption in the commercial and residential sectors has been increasing steadily as shown in Figure 2.8. Figure 2.9 shows the comparison of ener gy consumption per capita in major developed countries, and it indicates that Japan’s figure has been growing but it is still below other countries. Although the total ener gy consumption of commercial and residential sector has been growing, the energy efficiency on individual equipment base has improved dramatically . As Figure 2.10 shows, the energy needed for CRT television has been reduced by almost 50 per cent in twenty years, and

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1965 69 73

77.5

77

75.9

81

The First Oil Crisis

85

The Second Oil Crisis

89

93

97

2001

2005

90.2

Fiscal Year

Source: Compiled by the Agency for Natural Resources and Ener gy based on Yearbook of Natural Resources and Energy.

60

65

70

75

80

85

90

95

Degree of Dependency (%)

FIGURE 2.5 Rising Crude Oil Dependency on Middle East Countries in Japan

Energy Efficiency, Conservation Policies and Measures in Japan 29

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30

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40

50

60

70

80

90

100

110

Fiscal Year

73 74 75 76 77 78 79 80 81 82 83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03 19 19 19 19 19 19 19 19 19 19 19 19 19 19 19 19 19 19 19 19 19 19 19 19 19 19 19 20 20 20 20

Note: The Index of Industrial Production is weighted with value added structure (2000 standard) and af fected by sales values. When a sales price drops, the index may go below the index of production volume. Source: Energy Balance Tables in Japan, Yearbook of Indices of Industrial Production.

Index (FY1973=100)

FIGURE 2.6 Energy Consumption Intensity per Index of Industrial Production for the Manufacturing Industry

30 Yasushi Akahoshi

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31

Japan

1.00

U.S.

1.35

France

1.18

Germany

1.38

Note: Final energy consumption (tons in oil equivalent)/real GDP (1995 value in US$) (both are actual figures for FY2003), indicated in the ratio when the Japanese figure is set at 1. Source: Compiled by the Agency for Natural Resources and Ener gy based on data in Handbook of Energy and Economic Statistics.

0.00

0.50

1.00

1.50

FIGURE 2.7 Energy Consumption Intensity per GDP in the Industrial Sector by Country

Energy Efficiency, Conservation Policies and Measures in Japan 31

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02 Energy Efficiency Ch 2

32

2/26/08, 2:46 PM

25.5

27.7

25.9

33.0

28.2

40.3

30.8

42.7

52.3

51.0

61.3

1970 1973 1975 1980 1985 1990 1995

19.8

17.7

26.4

Source: Energy Balance Tables in Japan.

0.0

20.0

40.0

60.0

80.0

100.0

120.0

140.0

Million kl in crude oil equivalent

54.6

69.9

53.1

72.3

73.2

55.0

53.4

Household

74.7

54.1

74.1

1999 2000 2001 2002 2003 2004

53.0

69.1

Business

FIGURE 2.8 Transition of Energy Consumption in the Commercial/Residential Sector in Japan

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0.00

0.50

1.00

1.50

2.00

2.50

1973

0.54(Japan)

1.03(UK)

1.35(France)

1980

1.45(Germany)

2.24(US)

1985 1990

1995

2000

2002

2003

1.00(Japan)

1.20(UK)

1.34(France)

1.43(Germany)

1.86(US)

Source: Compiled by the Agency for Natural Resources and Ener gy based on data in Handbook of Energy and Economic Statistics.

2003 (Japan)=1

FIGURE 2.9 Transition of Energy Consumption in the Commercial/Residential Sector in Major Developed Countries Energy Efficiency, Conservation Policies and Measures in Japan 33

02 Energy Efficiency Ch 2

34

CRT Television

100 150 200 kWh

Approx 46.8% improvement

2006 model

2000 model

1995 model

0

1000

Air Conditioning

500

882 kWh/year

1,017 kWh/year

1,499kWh 1,492 kWh/year

kWh

1500

Approx 40.9% improvement

Source: Japan Electronics and Information Technology Industries Association/Japan Refrigeration and Air Conditioning Industries Association (JRA4046) (Standard for the calculation of periodic power consumption of room air conditioners)).

50

90 kWh/year 90kWh

2004 model

0

138138kWh kWh/year

166 166kWh kWh/year

1994 model

1984 model

FIGURE 2.10 Transition of the Energy Saving Performance of CRT Television and Air Conditioning

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Energy Efficiency, Conservation Policies and Measures in Japan 35

the energy for air-conditioners has been improved for more than 40 per cent in just ten years. One factor contributing to the increasing ener gy consumption is social change. As shown in Figure 2.11, the number of households has been increasing very steadily . Twenty to thirty years ago in Japan, it used to be very common for three generations to live in one household. However, the size of each household has reduced since many young couples prefer not to live with their parents.As such, the number of households has been increasing, and that has contributed to the growing ener gy consumption. Another factor for the increasing energy demand in this sector is the change in lifestyle. As shown in Figure 2.12, while many appliances have improved their energy efficiency standard, the number of appliances per household is increasing. As a result, energy consumption per household is rising. From my own personal experience, in 1973, when I was 8 years old, my apartment was not equipped with any air conditioner, and my family did not own a car . There was just one television for the entire family , but that did not mean that my family was poor. Nowadays, it is common for each room in a household to be equipped with an air conditioner and a television set, and for one family to have more than two cars. Even college students can af ford to own a car. The improving standard of living has definitely contributed to the increase in energy consumption, and the decisive factor for more ener gy saving lies in these areas. It should be noted that in the residential sector, standby power consumption is not negligible; it is as high as 7 per cent of total consumption. Therefore, the measure to deal with this issue would be indispensable.

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36

105

121

Energy consumption per household

Fiscal Year

Source: Compiled by the Agency for Natural Resources and Ener gy based on Energy Balance Tables in Japan and Statistics of Population.

Number of households

90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 19 19 19 19 19 19 19 19 19 19 20 20 20 20 20

100

105

110

115

120

125

(FY1990=100)

FIGURE 2.11 Transition of Per-Household Energy Consumption and Number of Households

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Electric refrigerators

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0.0%

25.0%

50.0%

75.0%

100.0%

125.0%

1990

unit / household (%)

Room air conditioner

Fiscal year

PC

Oil space heater

Electric refrigerator

Electric toilet seat with warm water shower

Source: FY 2006 Handbook of Energy and Economic Statistics in Japan.

29.6% 1998fy → 2004fy)

55.2% (1998fy → 2004fy)

Air conditioners

Electric freezers

67.8% (1997fy → 2004 Refrigerating year)

175.0% 150.0%

1991

73.6% (1997fy → 2003fy)

1992

Video cassette recorders

1993

200.0%

1994

25.7% (1997fy → 2003fy)

1995

Color TV

Color TV

1996

225.0%

1997

250.0%

1998

Energy Efficiency Improvement (result)

1999

appliance

Penetration of Appliances

2000

(Energy Efficiency Improvements of Appliances)

DVD player 2002

37

2003

02 Energy Efficiency Ch 2 2001

FIGURE 2.12 Ownership Status of Energy Consuming Appliances in Household

Energy Efficiency, Conservation Policies and Measures in Japan 37

2004

02 Energy Efficiency Ch 2

38

Standby power consumption 7.3%

Microwave/Electric Oven 4%

Personal Computer 3%

Telephone (extra handset) 2%

TV 5%

Cooling/Heating Airconditioner 7%

VCR 10%

Multi-function Toilet Seat 5%

Telephone 9%

Satellite TV Tuner 4%

Others 38%

Gas Hot water System 13%

Breakdown of annual standby power consumption per household

Source: FY2005 study on standby power consumption, Ener gy Conservation Center, Japan.

Power consumption while in use 92.7%

4209 kWh per annum per household

Household power consumption

Standby power ratio of total power consumption in households

FIGURE 2.13 Trend in Standby Power Consumption

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Energy Efficiency, Conservation Policies and Measures in Japan 39

Figure 2.14 shows the trend in the transportation sector. Energy consumption in that sector had increased even after the oil shock, but has levelled of f in recent years. Figure 2.15 shows that the expanded energy consumption in the transportation sector could be attributed to the increasing number of private passengers vehicles, even though energy consumption intensity is relatively low compared with other transportation. Energy Conservation Policy and Measures The energy conservation policies and measures in Japan consist of some elements, the core of which is the Ener gy Conservation Law, its literal translation from Japanese is “the Law concerning the Rational Use of Energy”. This law and other supplementary measures comprise the whole policies and measures. The preceding section examines the overall situation on energy consumption in Japan, by looking at three sectors: industrial, commercial and residential, and transportation. The Energy Conservation Law was originally designed for factories, but it has been expanded to include other sectors such as commercial and transportation sectors. For the residential sector and private vehicles in transportation sector, it is dif ficult to place such a wide range under government regulation. Therefore, various complementary measures have been planned and implemented. The basic concept of the Ener gy Conservation Law is illustrated in Figure 2.16. Factories and business establishments that have high ener gy consumption are designated as “Type 1”, and those with medium consumption

02 Energy Efficiency Ch 2

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40

23.4

23.5

25.7

24.3

32.2

36.6

43.0

54.3

1970 1973 1975 1980 1985 1990 1995

17.2

19.8

27.3

27.0

40.1

44.1

60.5

41.0

39.2

38.6

61.4

Passenger sector

61.6

61.2

Freight sector

40.9

61.0

38.8

1999 2000 2001 2002 2003 2004

60.1

41.6

Transition of energy consumption in the transportation sector

0.00

0.50

1.00

1.50

2.00

2.50

3.00

3.50

1.00(Japan)

1.24(UK) 1.20(France) 1.06(Germany)

2.99(US)

1973 1980 1985 1990 1995 2000 2002 2003

0.54(Japan)

0.76(UK) 0.71(France) 0.69(Germany)

2.72 (US)

Transition of per-capita energy consumption in the transportation sector

Japan

Germany

France

UK

US

Source: Energy Balance Tables in Japan (left chart) and compilation by the Agency for Natural Resources and Energy based on data in Handbook of Energy and Economic Statistics in Japan (right chart).

0.0

20.0

40.0

60.0

80.0

100.0

120.0

Million Kl in Crude Oil Equivalent

2003 (Japan)=1

FIGURE 2.14 Transition of Energy Consumption in the Transportation Sector

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Energy Consumption Intensity (MJ/passenger - km)

90 91 92 93 94 95 96 97 98 99 00 01 02 03 04

Source: Handbook of Energy and Economic Statistics in Japan.

0

0.5

1

1.5

2

2.5

3

Airplane (Passenger)

Ship (Passenger)

Train (Passenger)

Bus

Vehicle (Private)

FIGURE 2.15 Transition of Energy Consumption Intensity by Transportation

Energy Efficiency, Conservation Policies and Measures in Japan 41

02 Energy Efficiency Ch 2

42

Measures • Appointment of a qualified person for energy management of type 2 designated factory (Training Required) • Preparation & Submission of Periodical Reports • Preparation and Submission of mid - and long-term plans (Participation by a qualified person required)

Measures

• Appointment of Energy Manager (Mandatory to possess a license for a qualified person for energy management of type 1 designated factory) • Preparation & Submission of Periodical Reports • Formulation & Submission of Mid-and long-term Plans Factories

● Business Establishments

● Factories

• Annual energy use: 3000 kl in crude oil equivalent or larger

Factories/business establishments with high energy consumption (Type 1 Designated Energy Management Factories)

Department Store

Schools

Office Building

Business Establishments

• Preparation & Submission of Periodical Reports

• Appointment of a qualified person for energy management of type 2 designated factory

Measures

Hotel

● Factories and business establishments

• Annual energy use: 1500 kl in crude oil equivalent or larger

Factories/business establishments with medium energy consumption (Type 2 Designated Energy Management Factories)

FIGURE 2.16 Factory/Business Establishment Measures Under Energy Conservation Law

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Energy Efficiency, Conservation Policies and Measures in Japan 43

as “Type 2”. The current thresholds are annual consumption of 3,000 kl in crude oil equivalent for Type 1 and 1,500 kl for Type 2. Once factories or business establishments are so designated, they have to appoint qualified persons for energy management. The factories classified in Type 1 have to appoint licensed “ener gy managers”. Those factories or business establishments then have to submit periodical reports on its energy usage. They also have to submit medium and long-term plans for measures to achieve ener gy conservation targets. As shown in the flow chart in Figure 2.17, for Type-1 factories or business establishments, the government conducts on-site investigation or factory inspections to check if they meet the standards. If the results of assessments are below the threshold, they have to prepare and submit a rationalization plan, then implement the plan, and take other relevant steps. If they are deemed to be extremely insufficient against the set criteria, the government will then disclose the factory’s name and issue an order . The Energy Conservation Law is a regulatory measure. However, the regulation or restriction is one-sided and insufficient. Therefore, the government provides “incentives” to support the effort towards energy efficiency in the private sector. For example, the government supports: (i) lar gescale and joint energy saving efforts such as petrochemical industrial complexes, (ii) the installation of the industry’ s first model plant for highly ef ficient plants, and (iii) the installation of highly ef ficient industrial furnaces, whose energy saving ef fect is more than 30 per cent, thanks to waste-heat recovery mechanism and so on (see Figure 2.18).

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Factory subject to investigation

44

(2) Return (1)

(1) Send a preliminary survey form

Local bureau of economy, trade and industry

Flow of general inspection

According to judging criteria, examine the status of energy management standards, records, maintenance checklists, etc. If the assessment result is less than 50 points

Inspection

On - site investigation

02 Energy Efficiency Ch 2

If deemed extremely insufficient against judging criteria

Rationalization plan guidance If the establishment refuses to comply

FIGURE 2.17 Flow Chart for Factory/Business Establishment Measures Under Energy Conservation Law

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Public disclosure/ compliance order

02 Energy Efficiency Ch 2

45

Regenerative body

30-to-60-second switching

Regenerative burner

4-way selector valve

– Industrial furnaces are used at factories throughout the country for heating, dissolving, sintering, and drying purposes. – HighHigh-performance industrial furnaces are industrial furnaces that are confirmed to have an energyenergy-saving effect of more than 30% owing to wasteheat recovery mechanisms etc.

FIGURE 2.18 Example of an Energy-Saving Facility (High-Performance Industrial Furnace)

Energy Efficiency, Conservation Policies and Measures in Japan 45

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Yasushi Akahoshi

Figure 2.19 illustrates a well-known system for ener gy improvement in Japan, called Top Runner Program under the Energy Conservation Law. This program was introduced in 1998 and is applicable to home and of fice appliances as well as to automobiles. Taking automobiles as an example, the basic concept is to set the standard of ener gy efficiency at the best performer currently available in the market. In this example, the standard is set at 16 km per litre. Secondly , a target year is set and all manufactures are required to meet this tar get. Eventually, it can be expected that even the worst ener gyefficient automobile’s performance would meet the tar get of 16 km per litre. At present, twenty-one items are designated under this program, as shown in the list. The Top Runner Program aims to urge manufacturers to accelerate their efforts to compete with their rivals in terms of energy efficiency. The target year, which has been set differently for each item, has already been surpassed for some items, and many items have achieved the outcome beyond the tar get initially set even earlier than the tar get year (see Table 2.2). To further illustrate, Figure 2.20 shows the improvement in energy efficiency of automobiles. In 1999, the tar get for automobiles in the Top Runner Program was set at 2010. In 2004, the average fuel needed for 1 km was 15 litre, compared with the 12.1 km per litre in 1995, which was the “base year” for automobiles, and it was a 22 per cent improvement. Again, the target year is 2010. However, almost 80 per cent of automobiles had already achieved the ener gy-efficiency target for 2010 in advance, as shown in the figure.

02 Energy Efficiency Ch 2

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02 Energy Efficiency Ch 2

47 Stricter energy conservation standard

Fuel Economy (km/ )

Energy conservation standard based on the Top Runner Program

The concept of the program is that fuel economy standards for vehicles and energy conservation standards for electric appliances, etc. shall be set exactly the same as or higher than the best standard value of each product item currently available in the market.

*Top Runner Program :

Fuel Economy (km/ )

Example of Top Runner Program

17. Vending machines 18. Transformers 19. Jar rice cookers 20. Microwave ovens 21. DVD recorders

6. Fluorescent lights 7. Copying machines 8. Computers 9. Magnetic disc units 10. Electric refrigerators

2/26/08, 2:46 PM

*2: Added LCD and plasma TV from April 2006.

*1: Added heavy vehicles (bus and trucks) of 3.5t level from April 2006.

11. Electric freezers

15. Oil water heaters 16. Electric toilet seats

14. Gas water heaters

3. Air conditioners 4. TV sets (*2)

13. Gas cooking appliances

2. Freight vehicles (*1)

5. Videocassette recorders

12. Space heaters

1. Passenger vehicles (*1)

21 Specific Equipment

FIGURE 2.19 Improving Equipment Efficiency with the Top Runner Program

Energy Efficiency, Conservation Policies and Measures in Japan 47

Conventional energy conservation standard

02 Energy Efficiency Ch 2

Improvement in Energy Efficiency (Actual) 25.7% (Fiscal Year 1997–2003) 73.6% (Fiscal Year 1997–2003) 67.8% (Fiscal Year 1997–2004) 55.2% (Fiscal Year 1998–2004) 29.6% (Fiscal Year 1998–2004) 22.0% (Fiscal Year 1995–2004)

Products

TV sets

Video Tape Recorder

48

Air conditioner

Electric refrigerator

Electric freezers

Cars (gasoline)

22.8% (Fiscal Year 1995–2010)

22.9%

30.5%

66.1%

58.7%

16.4%

Improvement in Energy Efficiency (Planned)

TABLE 2.2 Standard Level of Energy Saving for Products with the Top Runner Program

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02 Energy Efficiency Ch 2

49

14.0 13.5 13.2 12.9

2/26/08, 2:46 PM

Fiscal Year

95 996 997 998 999 000 001 002 003 004 19 1 1 1 1 2 2 2 2 2

0

100

200

300

400

Million 500

Fiscal Year

1999 2000 2001 2002 2003 2004

TR completed Total Shipment TR completed VS. total shipment (%)

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Source: (Left chart) Handbook of Fuel Economy of Cars (Jidosha nenpi ichiran); (Right chart) Agency for Natural Resources and Energy.

11.0

11.5

12.0

14.6

15.0 14.7

Fuel economy of gasoline cars

12.4 12.3 12.5 12.1

13.0

13.5

14.0

14.5

15.0

15.5

16.0

(Km/L)

Number of cars completed 2010 standard, and its ratio to total shipment (gasoline cars)

FIGURE 2.20 Example of Improvement through Top Runner Standard (Gasoline Cars) Energy Efficiency, Conservation Policies and Measures in Japan 49

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Yasushi Akahoshi

Next, there is another measure for ener gy-efficiency in the households sector . It is called the Ener gy-Saving Labelling System.1 For the thirteen assigned products, such as air conditioners and fridges, manufacturers are required to label their products to show whether and how the product achieves or fails the target set in the Top Runner Program. This allows consumers to easily identify and compare products in terms of energy efficiency, which would affect the utility costs that they have to pay. High performers can use green labels, while lower performers have to use red labels, which might seem a little harsh for them. The labels on the left in Figure 2.21 are for display by retailers, and the one on the right is an example of a label attached to the unit itself. In 2006, the Uniform Energy Saving Label for retailers was introduced. Retailers are now required to provide accurate information in their stores in a uniform manner . In this system, energy-saving performance is indicated by the number of stars. The label also indicates the utility cost in Japanese yen. In this example, the consumer who buys this product has to pay roughly 9,900 yen per year (see Figure 2.22). Figure 2.23 shows appliances that have been designated the uniform labelling system. A system called Energy Efficient Retailer Assessment System was also introduced in 2003. This is the system for evaluating retailers instead of products.This system is based on the idea that retailers play an important role in ener gyefficient efforts. This system targets retailers whose sales of home appliances account for 50 per cent or more of total

02 Energy Efficiency Ch 2

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51

Target year FY2006

Target year FY2006

91% 206kW/Year

Annual Energy consumption

175kW/Year

108% Energy conservation standard achievement percentage

Annual Energy consumption

Energy conservation standard achievement percentage

FIGURE 2.21 Examples of Energy-Saving Labels

Label for the product's main unit

Energy Efficiency, Conservation Policies and Measures in Japan 51

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02 Energy Efficiency Ch 2

52

Uniform Energy Saving Label

[Expected annual electricity bill] • Expected annual electricity bill is included, in order to make energy consumption efficiency (e.g. annual energy consumption) easily understood.

[Energy-Saving Labeling Program] • Green symbol is for products meeting Top Runner standards, and orange symbol is for ones failing to meet the standards. • Top Runner standard achievement percentage and energy consumption efficiency (e.g. annual energy consumption) are also displayed.

[Multistage rating system] • Energy saving performance of a product is rated according to 5-level criteria. From the best performance to the worst, products in the market are expressed as from 5-star to 1-star. • In order to clarify how many stars are given to products meeting Top Runner standards, arrows are displayed under the stars to show a borderline of 100% achievement of the standards.

FIGURE 2.22 Uniform Energy-Saving Label

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53

2/26/08, 2:46 PM

○

○

○

○

○

○

Electric freezers

Fluorescent lamps

Electric toilet seats

TV sets

Computers

Magnetic disk units

○

○

○

○

○

○

Expected annual electricity bill

○

○

○

Uniform Energy Saving Label (*)

DVD

Due to be applied

Due to be applied

Microwave ovens VCR

Due to be applied

○

○

Electric rice cookers

Transformers

Oil water heaters

○

○

Gas cooking appliances Gas water heaters

○

Energy-Saving Labeling Program

Space heaters

Products

○

○

○

○

○ (Fuel usage)

○ (Fuel usage)

○ (Fuel usage)

Expected annual electricity bill

Uniform Energy Saving Label (*)

Note: Energy-saving label, electricity bill and ener gy saving information based on a multi-stage rating system are provided in a uniform fashion, as Uniform Ener gy Saving Label.

○

○

Energy-Saving Labeling Program

Electric refrigerators

Air conditioners

Products

FIGURE 2.23 Labelling Program for Appliance Retailers Energy Efficiency, Conservation Policies and Measures in Japan 53

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Yasushi Akahoshi

sales. METI recognizes retailers who actively promote energy-efficient products or provide appropriate ener gy conservation information. Those retailers may display the logo shown in Figure 2.24, which states “excellent retailer who promotes energy-efficient products”. It is earlier stated that standby power consumption is not negligible. In order to reduce such consumption, voluntary programmes have been conducted by relevant industry associations, such as that of the electronic and gas industry, as shown in Figure 2.25. High-efficiency equipment are also being promoted in Japan. Taking into consideration that ener gy demand for hot-water supply comprise almost 30 per cent of total energy consumption in a household, the introduction of energy-efficient hot-water supply system, such as the HeatPump Boiler which has 30 per cent ener gy-saving effect, is promoted (see Figure 2.26). High-ef ficiency air conditioning systems as shown in Figure 2.27 are also being promoted. Regulation measures in the Ener gy Conservation Law are also applied to residential and building sectors, and the application was strengthened by the amendment. In such cases, METI cooperates with relevant agencies and local governments. In the past, only lar ge-scale buildings are governed by the regulation, but now it is also applied to large residential construction. Those who intend to construct, extend, or repair extensively these types of buildings have to submit their plan for ener gy conservation to local governments, and if they are regarded as insuf ficient, administrative instructions shall be given (see Figure 2.28).

02 Energy Efficiency Ch 2

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Logo

55

● “Outlets that Excel at Promoting Energy-Efficient Products” are selected each year and publicized along with their rankings. Effective FY2004, Minister of Economy, Trade and Industry Award and Minister of Environment Award are awarded to large stores. ● Selected retailers are authorized to carry a special logo.

･ Large home appliance retailers having a total floor space of at least 800 m2, whose sales from home appliances account for 50% or more of total sales

Modified in FY2005

● Targeted retailers: ● All home appliance retailers whose sales coming from home appliances account for 50% or more of total sales

FIGURE 2.24 Energy Efficient Product Retailer Assessment System

Energy Efficiency, Conservation Policies and Measures in Japan 55

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02 Energy Efficiency Ch 2

56

● Japan Industrial Association of Gas and Kerosene Appliances is planning to achieve the goal of lowering standby power consumption of gas cooking appliances to 1 W or lower by the end of FY2008, as the association considers the reduction of the total energy consumption by gas and oil appliances as the target of their industrial efforts.

● Japan Electronics and Information Technology Industries Associa tion, Japan Electrical Manufacturers' Association, and Japan Refrigeration and Air Conditioning Industry Association worked hard toward the goal of lowering the standby power consumption to 1 W or lower until the end of FY2003 with regard to products that essentially require standby power (until the end of FY2004 with regard to air conditioners), with the target achieved at the end of the target year.

Outline of voluntary efforts by the relevant relevant industries industries

FIGURE 2.25 Example of Voluntary Programme to Reduce Standby Power Consumption

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02 Energy Efficiency Ch 2

LatentLatent-heat Recovery Boiler (ECO JOZU) Recovers the latent heat of exhausted gas, gas, which is usually wasted. Energy saving of approximately 15% compared to a conventional combustioncombustion-type boiler is realized.

CO2 Refrigerant HeatHeat-Pump Boiler (ECO CUTE)

Utilizing the principle of a heatheat-pump used in an airair-conditioner, conditioner, it can be heated with energy of approximately 3 times more than input energy. Energy saving of approximately 30% compared to a traditional combustioncombustiontype boiler is achieved.

57

Uses the gasgas-powered engine's exhaust heat and power to provide heat (main) and electricity (sub) for approximately 10% of overall energy saving for a building.

Gas Engine Boiler (ECO WILL)

FIGURE 2.26 Example of Promotion of High-Efficiency Boilers

Energy Efficiency, Conservation Policies and Measures in Japan 57

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58 Refrigerant piping

Heat source unit

Heat storage tank

Air conditioning unit

Cold & hot water piping

Maximum energy conservation effect by changing to high-efficiency units: Approximately 63%

Maximum energy conservation effect by changing to high-efficiency units: Approximately 25%

Centralized Centralizedcontrol controlsystem system

Air conditioning duct

Guest room

Guest room

Guest room

Guest room

Guest room

Coolant piping

• Refrigerating capacity: 100 Rt to 3000 Rt • The system is mainly used for medium-sized buildings, shopping centers, large-sized buildings, and high-rise buildings.

Banquet hall

Fan coil unit

Cooling tower

• Refrigerating capacity: 8 Rt to 300 Rt • The system is mainly used for small stores, medical clinics, small offices, and suburban stores.

Decentralized Decentralizedseparate-unit separate-unitsystem system

Indoor unit

Outdoor unit

FIGURE 2.27 Example of Promotion of High-Efficiency Air Conditioning Systems

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59

Residence

Building

* Competent authorities: Prefectural authorities, with district construction surveyors, governing construction authorization procedures * Energy-saving measures: Insulation of exterior walls, windows, etc. and effective use of air conditioning systems or the like * Extensive repair: Extensive repair or rearrangement of exterior walls, windows, etc, and new installation or extensive repair of air conditioning systems or the like

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Reinforced

● Those who have submitted the notifications mentioned above shall periodically report the maintained status of energy conservation measures to the competent authorities. (If the maintained status is found significantly insufficient, the authorities shall advise the concerned parties.)

• If the energy conservation measures are found to be significantly insufficient, instructions shall be given and the status shall be announced to the public.

• Submission of notification of energy conservation measures upon new construction, extension, or rebuilding

Buildings with a total floor of 2,000 m2 or larger (non-residential buildings)

Buildings with a total floor of 2,000 m2 or larger (non-residential buildings) • Submission of notification related to energy conservation measures upon new construction, extension or rebuilding, or extensive repair • If the energy conservation measures are found to be significantly insufficient, instructions shall be given and the status shall be announced to the public. Residences with a total floor of 2,000 m2 or larger • Submission of notification related to energy conservation measures upon new construction, extension or rebuilding, or extensive repair • If the energy conservation measures are found to be significantly insufficient, instructions shall be given and the status shall be announced to the public.

Compulsory notification of energy conservation measures (applicable to buildings of a certain scale)

Contents of modification

︻ Efforts concerning energy ︼ conservation measures

02 Energy Efficiency Ch 2

Reinforced measures against stock Compulsory submission of the notification of energy-saving measures to the competent authorities by a party who will extensively repair non-residential buildings of a certain floor size (a total floor area of 2,000 m2 or more) etc. (The current law only requires the responsibility of parties who newly build, extend, or rebuild buildings.) Reinforced measures for residences Compulsory submission of notification of energy-saving measures to the competent authorities for residences of a certain size (a total floor area of 2,000 m2 or more) as in the case of non-residential buildings. (The current law only requires the concer ned parties to make efforts to do so.)

FIGURE 2.28 Reinforced Energy Conservation Measures in Residential and Building Sector

Energy Efficiency, Conservation Policies and Measures in Japan 59

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In such cases, besides the regulation, we provide promotional measures to improve the ener gy efficiency in houses and buildings. We have a programme called “Government program to foster the introduction of high efficiency energy systems in houses and buildings” as shown in Figure 2.29. There are energy-management systems utilizing IT. Such systems for homes are called Home Ener gy Management System (HEMS). The system for buildings is called Building Energy Management System (BEMS). A new business called Ener gy Service Company (ESCO) offers comprehensive services on ener gy conservation to their clients, and the clients pay a part of their energy saving gain, such as savings on utility bills. As shown in Figures 2.30 to 2.32, the ESCO market has been growing since the mid-1990s, and it has reached almost 50 billion yen, which is equivalent to US$400 million. The government promotes such kind of business by partial subsidies and low interest loans. METI also had a contract with one ESCO service provider for METI’ s building in order to accelerate the usage of ESCO in public sectors. It pays 20 million yen for a four-year contract and the contractor guaranteed the minimum reduction of 5.5 million yen per year . Figures 2.33 and 2.34 show ener gy conservation measures in the transportation sector . The regulatory measures are similar to those for the industrial sector . Transportation business operators, as well as other business operators who act as consigners, are subject to the regulation. They have to submit their energy saving plans and periodical

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61

• Energy in houses and buildings is effectively saved by the comprehensive introduction and utilization of highly heat insulating buildings, high-efficiency equipment and appliances, and energy management systems. • Therefore, highly-motivated efforts to introduce multiple "high-efficiency energy systems" are supported with an aim to promoting wide use thereof in a wide range of applications. • As for houses, in particular, it is important to make the functions and advantages of highly energy-saving houses known widely to consumers. For this purpose, studies are now under way in a direction to effectively utilizing budgetary measures by evaluating higher performance in a suitable and appropriate manner and enhancing the collaboration with the program to visualize such performance. High-efficiency airconditioner or central air-conditioning system

High thermal insulation and high airtight specifications

Automatic dimming with sensors to detect the presence of people

Hot water supply to bathroom

Floor heating

High-efficiency airconditioner or central airconditioning system

Photovoltaic power generation or solar energy utilization

High-efficiency water heater

● Example of high-efficiency energy system

Government program to foster the introduction of highhighefficiency energy systems in houses and buildings

FIGURE 2.29 Support Given to High-Efficiency Houses and Buildings

Energy Efficiency, Conservation Policies and Measures in Japan 61

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62

Before the introduction of ESCO business

Utility charge payment Utility charge payment

Initial investment

ESCO expenses Interest

During the implementation of ESCO business

Repayment

Customer gain

ESCO operator shall guarantee the achievement.

Energy conservation effect

02 Energy Efficiency Ch 2

Overview of ESCO business

After the contract term completed

Utility charge payment

Customer Gain Lease/loan

Customer

Service charge

Installation

No initial costs

Shared method

Financial institution

Leasing company

Guaranteed method

FIGURE 2.30 Promotion of ESCO Business

Energy-saving guarantee

ESCO

Shouldering installation cost

Lease/loan

Shouldering installation cost

Customer

Financial institution

Leasing company

ESCO

サービス料 Service charge

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63

1998

170 10

1999

186 19

2000

265 36

2001

74

449

2002

140

2003

353

557

Scale of ESCO - related markets

others Energy audit＋repair construction＋performance contract Energy audit＋repair construction 515 repair construction

2004

172

374

30.3billion Yen 68%

2005 Fy

497

Note: Research estimates its potential market size at 2,470 billion yen (The ECCJ’ s ESCO Introduction Promotion Study Group Report). The market scale of ESCO business in the United States in 2000 is approximately US$2 billion. Source: JAESCO (Japan Association of Energy Service Companies) survey.

0

100

200

300

400

500

600

(billion yen)

FIGURE 2.31 ESCO-Related Market Scale Energy Efficiency, Conservation Policies and Measures in Japan 63

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Energy saving lighting

64

Steam line

■Toilet using gray water

Boiler drain

■ Insulation, integration

Inverter control

monitoring center

Hot/cold Machine water systemroom

Parking

■ Reduced power for air conditioning fan/pump

Power Central disaster prevention room

Fluorescent lights

■ Energy conservation with a three-step light-modulating inverter stabilizer

■ Supply of electricity/heat ■ Effective use of exhaust heat

Co-generation system

■ Updating to the latest Top Runner qualified equipment

Gas driven absorptiontype hot water system

■ Steam drain used as gray water

Reduced water use when using the toilet

Energy conservation effect due to the introduction of ESCO: Approximately 25%

Example of ESCO business introduction (at a hospital)

FIGURE 2.32 Support for the Introduction of ESCO Business

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FIGURE 2.33 Measures for Spread and Promotion of Eco-driving

Energy Efficiency, Conservation Policies and Measures in Japan 65

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66

“Idling-stop” implementation time ratio (25.9%)

Stop time ratio (48.3%)

(Fuel Economy Reduction Rate)

[Stop & “idlingidling-stop” stop” implementation time ratio in urban area]

Nationwide (3719km)...5.8% on average Or 13.4% in city areas

Results of “The Idling-Stop 2002 Caravan Throughout Japan”

Urban area

02 Energy Efficiency Ch 2

Result of the driving experiments by “idlingidling-stop” stop” cars

IdlingIdling-free promotional event (Osaka)

An event for “idling-stop-at-stoplight” experiments is scheduled for October 2005

PR activities

FIGURE 2.34 Promotion of Cars with the “Idling-Stop” System

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Energy Efficiency, Conservation Policies and Measures in Japan 67

reports to the relevant ministries. If these are regarded to be insufficient, they will be given some advice, and if the advice is not followed through, measures such as disclosure of names or fines may be applied. Relevant ministries, METI, National Police Agency, Ministry of Land, Infrastructure andTransport, and Ministry of Environment are also promoting eco-driving, which could have a 25 per cent ener gy-saving effect. We have also been promoting cars with the “idlingstop” system that can improve fuel economy by almost 10 per cent, through subsidy and other measures. Japan has also introduced the “automobile greening tax”, which reduces the burden on the purchaser of automobiles with excellent fuel-economy (see Figure 2.35). Measures such as Electronic Toll Collection (ETC) have been promoted as one of the tools for energy conservation. The Government of Japan published a New National Energy Strategy in 2006. The target for energy efficiency is at least 30 per cent improvement by 2030. Based on this strategy, METI has prepared a Strategy for Ener gy Conservation Technology. This strategy focuses on five priority fields, such as energy conservation technology for living space or technology for advanced traffic society. The budget will be distributed according to its priority in the strategy . The government is promoting the development of energy conservation technology in many ways and spends almost 50 billion yen, equivalent to US$400 million, per year .

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FIGURE 2.35 Measures to Reduce Drivers’ Burdens with Automobile Greening Tax

68

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Yasushi Akahoshi

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Transportation Business Transportation Business Operators Operators

One-coin bus (\100 per ride), etc.

Measures for improving the convenience of public transport

Combination=TDM

National Police Agency/ Ministry of Land, Infrastructure and Transport certify and partially subsidize (1/3 of costs) for verification trials expected to gain effectiveness on congestion alleviating measures.

Government Support

Control on illegal parking

Local Police Local Police

12 trillion yen in economic loss each year Limitations to road development aimed for transport capacity increase

Measures for managing traffic demand

? ?

Serious traffic congestion in city areas

ETC promotion measures

Source: Organization for Road System Enhancement (What is ETC?)

Two-way Radio

Roadside aerial

Raise ETC usage rate to around 70% by the end of FY2007 to alleviate congestion at toll gates.

Source: METI Japan/Organization for Road System Enhancement.

Verification Trial

Experimental measure for Experimental measurein for alleviating congestion alleviatingbetween congestion partnership localin partnership between local governments, the police governments, the police and transportation and transportation businesses businesses

Park & Ride, etc.

Road RoadManager Manager

Current Status

Promotion of TDM (Transportation demand management) trial

FIGURE 2.36 Traffic Management Measures

Energy Efficiency, Conservation Policies and Measures in Japan 69

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International Cooperation for Energy Efficiency and Conservation Figure 2.37 shows the projection by the Institute for Energy and Economy of Japan (IEEJ). According to their Asia/ World Energy Outlook 2006, the ener gy demand in Asia would grow rapidly by 2.8 per cent per year up to 2030, compared with 1.7 per cent for world and 1 per cent for North America. Therefore, Asia will use up nearly twothirds of world’s energy demand in 2030, while the figure in 2004 was only half of world’ s demand. Among the Asian countries, growth of ener gy demand from India and China are expected to have the most significant impact (Figure 2.38). From 2004 to 2030, while Asia’s increase would be twofold, China’ s increase would be 2.1 times and India’s would be 2.9 times. Energy intensity per GDP indication, compared with Japan set as 1.0, are 18 in Russia, 9.2 in India, and 8.7 in China (Figure 2.39). Figure 2.40 shows the progress in ener gy conservation in Japan from a different perspective. The growth in energy consumption in Japan remains at a low level compared with its economic growth. Figure 2.41 shows the dif ferent perspective for ener gy consumption. The energy intensity, shown as a figure of ton-oil equivalent divided by billion yen, has improved 37 per cent over the last thirty years. Japan believes that the cooperation in energy efficiency and conservation should be the main focus of cooperation in Asia, and it has been very aggressive in promoting the widespread use of Japan’ s advanced ener gy-saving

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Mtoe

1.0%

N.America

1980 1990

* Average annual growth rate

2.8%

1.7%

Asia

World

’04-‘30

AAGR*

2000

2010

2020

Non-OECD Europe

OECD Europe

N.America

Asia

Source: Asia/World Energy Outlook 2006, The Institute of Energy Economics, Japan.

1971

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

FIGURE 2.37 Perspective of World Energy Demands

2030

L.America Middle East Africa Oceania

(2.0-fold increase)

6.2 billion toe

2030

↓

3.1 billion toe

2004

Asia

(1.6-fold increase)

15.9 billion toe

2030

↓

10.2 billion toe

2004

World

Energy Efficiency, Conservation Policies and Measures in Japan 71

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72 AAGR

Mtoe

Philippines

Malaysia 7.6% 4.5%

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1990 2004 2010

3.6% 4.6%

India

2020

China

Japan

South Korea

2030

46%

9%

6%

16%

China/India

6.2 billion toe (2.0-fold increase)

2030

3.1 billion toe ↓

2004

Asia

(2.1-fold inc.) ( 2.8-fold inc.)

2030 2.9 bil. toe 1.0 bil. toe

↓

2004 1.4 bil. toe 0.4 bil. toe

Source: Asia/World Energy Outlook 2006, The Institute of Energy Economics, Japan.

1980

45%

17%

7%

12%

5.0% 1.4%

Hong Kong Other Asia

India Indonesia Taiwan Singapore 5.5% 8.4% 7.2% 6.8% 4.0% 3.6% 2.0% 2.7%

Thailand Vietnam 7.9% 4.0% 4.1% 4.4%

8.0% 1.8%

South Korea

Japan India Taiwan Malaysia Thailand Hong Kong

4.2% 4.2%

Japan 2.1% 0.0%

China 5.5% 2.8%

China South Korea Indonesia Singapore Philippines Vietnam Other Asia

2004-2030

1971-2004

0 1971

1000

2000

3000

4000

5000

6000

7000

2. Asian Primary Energy Demand by Region

FIGURE 2.38 Asian Primary Energy Demand by Region

72 Yasushi Akahoshi

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n

pa Ja

1 EU

1.7

A US

2.0

Source: IEA Energy Balance 2006.

0

5

10

15

20

ea

r Ko

3.2

C

da

a an

nd

a ail

Th

3.2

id

M

sia e on d In

6.0

st

a eE

dl

6.0

8.1

na i Ch

8.7

ia d In

9.2

ia

18.0

ss Ru

FIGURE 2.39 Comparison of Energy intensity per GDP by Country Energy Efficiency, Conservation Policies and Measures in Japan 73

02 Energy Efficiency Ch 2

74 65

4.54

7.07

70 75 80 85

Real GDP

90

95

Final energy consumption

00

03

15.92

523

Real GDP (yen in trillions: the price in the reference year 2000)

0

100

200

300

400

500

600

Note: The partial changes were made in the calculation method for the numerical values after 1990 in the “Comprehensive Energy Statistics”, such as the final ener gy consumption, which was changed from the statistics of the supply side to that of the consumer side. Source: Comprehensive Energy Statistics, by Agency for Natural Resources and Energy; and Energy and Economy Statistics Handbook, by The Institute of Energy Economics, Japan (IEEJ).

0

5

10

15

20

25

30

Amount of energy

FIGURE 2.40 Progress in Energy Conservation in Japan 74 Yasushi Akahoshi

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'75 '76

'73

'74

Primary energy consumption / GDP

1,101

1,192

Source: METI/General Energy Statistics.

900

1,000

1,100

'77 '78

1,273

1,345

'81

1,200

1,327

1,405

'79 '80

1,300

1,438

1,059

1,142 1,101

1,131

'82 '83

1,400

1,059

1,091

1,021

1,060

1,036 1,037

1,038

1,050

1,064

1,086

989982

1,055 1,041 1,055

1,071

Improvement by 37%

Fiscal Year

'84 '85

1,467

'86 '87

1,500

'88 '89

1,573

'90 '91

1,566

'92 '93

1,600

'94 '95

1,700

'96 '97

Ton oil eq. / Billion yen

'98 '99

75

'00 '01

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'02

FIGURE 2.41 Changes in Energy Intensity in Japan Energy Efficiency, Conservation Policies and Measures in Japan 75

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Yasushi Akahoshi

technology. In that context, Japan supports the capacitybuilding of Asian countries in the ener gy efficiency and conservation field by dispatching experts and accepting trainees. Dispatched experts provide information and lectures on Japan’s energy saving technology, legal system, among others. Invited trainees study Japan’s energy saving efforts and visit energy saving facilities (see Figure 2.42). The New Energy Development Organization (NEDO), a semi-governmental or ganization, has been conducting projects by which Japan transfers its ener gy-saving technology into Asian countries. Examples of these projects are shown in the right-hand-side of Figure 2.42. China’s surging energy demand will af fect the world energy balance. Therefore, the need for energy efficiency is most critical in China. Last year, Japan held a Japan-China Energy Conservation and Environment Forum, whereby both government officials and private sectors exchanged a wide range of opinions regarding energy and environment. Both sides have agreed to continue such dialogues in the future. Following the forum, the cooperation between the two countries has been developing in various ways, which include training and sending missions, at both governmental and private sector levels. Both sides also agreed to establish the Policy Dialogues between Japanese and Chinese Ener gy Ministers and to implement some model projects in the energy conservation and environment fields (see Figures 2.43 and 2.44). It is expected that energy demand of India and ASEAN countries would continue to grow . Under such situations, ASEAN countries and India are now addressing ener gy

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Source: METI, Japan.

FIGURE 2.42 Japan’s International Cooperation in EEC for Asia

Energy Efficiency, Conservation Policies and Measures in Japan 77

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Source: METI, Japan.

( However, it is necessary to pay attention to the prevention of drains of technologies, issues of intellectual properties, etc.)

○reinforcement of the business-based cooperative relations in consideration of intentions of industry circles.

○Government-level cooperation is expanded to the cooperative relations between the two countries.

Future efforts

○exchange Information about energy conservation on the basis of industrial associations ○exchange of opinions with Chinese Premier Wen Jiabao about energy conservation cooperation and sending mission Japan-China Economic Association (September 3 to 9, 2006: about 150 persons). ○establishment of the "Japan-China Conference to Promote Energy Conservation and Environmental Businesses" (December, 2006).

acceptance of research mission for the proposed revision of the Energy Conservation Law (October 25 to November 2, 2006), and for the development of energy conservation standards (November, 2006). ○ training for Chinese Communist Party s staff about an energy conservation model building (December, 2006). ○ plans to provide energy conservation training for the central and local governments of China (the first training on November 9 to 22, 2006).

○

・Continuation of energy efficiency & conservation cooperation for China, based on the results of the forum ・reinforcement cooperation in the energy and environment fields (October 2006).

Recent developments

FIGURE 2.43 Recent Development about Energy Efficiency and Conservation for China

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Source: METI, Japan.

○The ministry and commission aim to facilitate the matching between Japanese and Chinese companies, designating model projects, providing guidance, advice and support to model projects, preventing and quickly settling disputes over such model projects, etc.

○For the preparation and smooth implementation of such projects, a committee is formed between the Japanese METI and the Chinese NDRC to properly promote the projects.

○The model projects in the energy conservation and environment fields to promote businessbased cooperation are implemented.

Implementation of model projects in the energy conservation and environment fields

○concerning a wide range of energy fields such as energy conservation and environment, coal, oil, nuclear energy, etc.

Creation of "Policy Dialogues between Japanese and Chinese Energy Ministers"

Facility to recover waste heat from coke ovens

✍ Japanese METI Minister Akira Amari and Chinese National Development and Reform Commission Minister Ma Kai met in Beijing in December 2006 and agreed to promote the cooperation in the energy field of the two countries. [Minister Akira Amari and Minister Ma Kai.]

FIGURE 2.44 Recent Cooperation about Energy Efficiency and Conservation for China Energy Efficiency, Conservation Policies and Measures in Japan 79

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Yasushi Akahoshi

conservation, and Japan is also willing to support such efforts through various measures (see Figures 2.45 and 2.46). According to IEEJ projections (Figure 2.47), there would be room for energy reduction of 15 per cent or 940 million ton equivalent in Asia in 2030, if we can take advantage of the energy saving technology. This is 1.8 times the scale of Japan’s current primary energy demand. The Government of Japan published the New National Energy Strategy in 2007. Based on the strategy, METI also formulated an Asian Energy Efficiency and Conservation Program, by which Japan strengthens the support for Asian countries in this field (Figure 2.48). In conclusion, we note that the Second EastAsia Summit in Cebu in January 2007 discussed ener gy as the most important issue (Figure 2.49). At the summit, Japan’s Prime Minister Abe proposed the cooperation plan named “Fuelling Asia-Japan’s Cooperation Initiative for Clean Ener gy and Sustainable Growth”, which was welcomed by other leaders. It contains cooperation measures including biomass energy and clean use of coal, but the ener gy efficiency and conservation is top priority, as shown in Figure 2.50.

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Japan

India Others

Other Asian countries

China

Central and South America 2004-2030

OECD countries in Europe

North America

Non-OECD countries in Europe

13%

North America 26%

China

0%

Japan

11%

India

18%

Other Asian countries

Share of amount of increase in 2004-2030

Source: Asia/World Energy Outlook 2006, The Institute of Energy Economics, Japan.

Oil equivalent 0 million -200 tons

200

400

600

800

1,000

1,200

1,400

1,600

[The amount of increase in consumption of primary energy (by region) in the world in 2004-2030]

FIGURE 2.45 Current Status in India and ASEAN Countries

Energy Efficiency, Conservation Policies and Measures in Japan 81

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Source: METI, Japan.

・Japan sent experts and provided training to ASEAN countries to develop human resources for energy conservation. ・Japan plans to accept trainees from the governments of ten ASEAN countries (February 2007). ・ Japan is considering to provide training to Indonesian people engaged in energy conservation.

ASEAN countries

• Energy conservation experts were sent to the Indian government (from October, 2006) • "Japan-India Energy Forum" was held in New Delhi in December. • Japan and India agreed to create the energy dialogues between ministers. Promotion of energy conservation cooperation is written in the agreement between the leaders of the two countries. • Japan accepts trainees from India's central and local governments and other relevant organizations

India

FIGURE 2.46 Examples of Cooperation with India and ASEAN Countries in Energy Conservation

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83

669

2.1

Tech. Advanced

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1990 2000

3,063

4,460

5,007

2010

2020

Technological Advanced

3,636

3,828

Reference

2030

5,266

6,209

Source: Asia/World Energy Outlook 2006, The Institute of Energy Economics, Japan.

1980

1,684

2.8

Reference

1,060

3.9

2004-2030

GDP

AAGR(%)

Mtoe

1971 197

0

1,000

2,000

3,000

4,000

5,000

6,000

7,,000

FIGURE 2.47 Primary Energy Demand in Asia

Energy Efficiency, Conservation Policies and Measures in Japan 83

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Source: METI, Japan.

ASEAN

2. To help Japanese companies promote the businesses involving energy-saving equipment and facilities. Countries

India

China

Others

"Reinforcement of support to establish energy conservation systems"

"Inauguration of cooperation in energy conservation"

"Top priority country for cooperation in energy conservation"

1.To support the establishment of energy conservation systems.

Improvement of energy demand and supply structure Measures to cope with global environmental issues International contribution

Significance of cooperation in energy conservation

FIGURE 2.48 Reinforcement of Cooperation in Energy Conservation Based on the New National Energy Strategy (Asian Energy Efficiency and Conservation Programs)

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Source: ASEAN Website.

-Take concrete actions toward improving energy efficiency through enhancing international cooperation. Set individual goals and formulate action plans voluntarily for improving energy efficiency. -Encourage the use of biofuels. Work toward freer trade on biofuels and a standard on biofuels. Encourage collective efforts on searching for new and renewable energy resources. -Promote clean use of coal and development of clean coal technologies. -Explore possible modes of strategic fuel stockpiling, etc.

Member countries work closely together toward the goals such as i) improving the efficiency and environmental performance of fossil fuels, ii) reducing dependence on conventional fuels, iii) the open and competitive international markets, and take following measures.

CEBU DECLARATION ON EAST ASIAN ENERGY SECURITY [summary]

FIGURE 2.49 Summary of Cebu Declaration on East Asian Energy Security

Energy Efficiency, Conservation Policies and Measures in Japan 85

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Source: METI, Japan.

4. Eradication of Energy Poverty - Provide energy-related ODA of approximately USD 2.0billion over the next 3 years.

3. Clean Use of Coal - Establish “Coal liquefaction Assistance Center.” - Provide technical cooperation on clean coal technology

2. Promotion of Biomass Energy - Establish “Asia Biomass Energy Research Core.” - Receive 500 trainees in five years. - Organize seminars on best practices. - Establish “Asia Biomass Energy Cooperation Promotion Office.”

1. Promotion of Energy Efficiency and Conservation - Receive 1,000 trainees and dispatch 500 experts in five years. - Establish “Asia Energy Conservation Collaboration Center.” - Make full use of yen loan and JBIC loan facility.

Fueling Asia- Japan’s Cooperation Initiative for Clean Energy and Sustainable Growth

FIGURE 2.50 Asia-Japan’s Cooperation Initiative for Clean Energy and Sustainable Growth 86 Yasushi Akahoshi

Energy Efficiency, Conservation Policies and Measures in Japan 87

Note 1.

Singapore government’s National Environmental Agency (NEA) also sets up a “green” label as a mandatory requirement for air conditioners and refrigerators starting January 2008. The scheme was actually introduced in April 2002, but so far only about 20 per cent of those appliances have been labelled. This is in line with steps taken in other countries such as Australia, China, and United States, apart from Japan. (“ ‘Green’ labels a must for air -cons, fridges”, Straits Times, 30 June 2007.)

02 Energy Efficiency Ch 2

87

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Index

89

Index A Abe, Shinzo, 1 Agency for Natural Resources and Energy, 22 air-conditioning system energy saving performance, 34 perception of coolness, 16 appliance retailers labelling program, 53 ASEAN countries cooperation in energy conservation, 82 current status, 81 Asia primary energy demand, 83 Asia-Japan Cooperation Initiative for Clean Energy and Sustainable Growth, 80, 86 Asian Energy Efficiency and Conservation Programs, 84 Asian primary energy demand, by region, 72 Automobile Greening Tax, 68

03 Energy Efficiency Index

89

automobiles drivers’ burden of Automobile Greening Tax, 68 B biomass ethanol United States bias towards, 7 Building Energy Management System (BEMS), 60 building sector application of Energy Conservation Law, 54 reinforced energy conservation measures, 59 Bush, George W. State of the Union Address (2007), 7 business establishments Energy Conservation Law, 39, 42 measures under Energy Conservation Law, 44

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90

Index

C cars idling-stop system, 66 Cebu Declaration on East Asian Energy Security, 21, 85 China cooperation on energy efficiency and conservation, 79 developments in energy efficiency, 78 energy efficiency, 2 increase in energy demand, 9, 76 rise in domestic consumption, 28 clathrate hydrated slurry air conditioning system, 11, 12, 13 commercial sector energy consumption, 32 rise in energy consumption, 28 CRT television energy saving performance, 34 E East Asia Summit regional economic cooperation, 21 Second, 1

03 Energy Efficiency Index

90

eco-driving promotion of, 65 Electronic Toll Collection (ETC), 67 energy conservation cooperation with China, 79 dawn of, 2 Japan’s government target, 2 need for change in attitude, 13 progress in Japan, 74 Energy Conservation Law, 39 appointment of qualified persons for energy management, 43 basic concept, 39 building sectors, 54 factories and business establishments, 39 flow chart for measures, 44 residential sectors, 54 energy conservation technologies financial responsibility for, 14 energy consuming appliances ownership of, 37 energy consumption by sector, 23, 26 commercial and residential sectors, 28

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Index

91

commercial sector in major developed countries, 33 commercial/residential sector in Japan, 32 comparison of three sectors, 22 effect of change in lifestyle, 35 effect of social change, 35 per GDP in industrial sector by country, 31 per household, 36 per index of industrial production, 30 transportation sector, 40 energy consumption intensity transportation sector, 41 energy demand Asia, 83 energy efficiency China, 78 improvement in commercial and residential sectors, 22 improvement in Japan, 2 individual equipment base, 28 Energy Efficient Product Retailer Assessment System, 55 Energy Efficient Retailer Assessment System, 50

03 Energy Efficiency Index

91

energy intensity changes in Japan, 75 comparison per GDP by country, 73 energy management qualified persons for, 43 energy management systems utilization of IT, 60 energy managers licensed, 43 energy saving facility example of, 45 Energy Saving Labelling System, 50 Energy Saving labels examples, 51 energy saving performance CRT television, 34 energy saving technologies difficulty in transferring out of Japan, 13 problems exporting, 1–19 energy self-sufficiency major countries, 6 Energy Service Company (ESCO), 60 promotion of business, 62 support for introduction of, 64 energy sources effect of developing new, 7 Japan, 24 ESCO-related market scale, 63

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92

Index

F factories Energy Conservation Law, 39, 42 flow chart for measures under Energy Conservation Law, 44 First East Asia Energy Ministers Meeting, 21 flow chart measures under Energy Conservation Law, 44 G Gas Engine Boiler, 57 H Heat-Pump Boiler, 54, 57 high-efficiency air condition system promotion, 58 high-efficiency boilers promotion, 57 high-efficiency buildings support given to, 61 high-efficiency equipment promotion of, 54 high-efficiency houses support given to, 61 Home Energy Management System (HEMS), 60 households decrease in size, 35

03 Energy Efficiency Index

92

energy consumption, 36 energy-consuming appliances, ownership of, 37 hybrid cars, 9 I India cooperation in energy conservation, 82 current status, 81 increase in energy demand, 9 Indonesia rise in domestic oil consumption, 28 industrial furnaces, 43 industrial sector energy conservation, 24 rise in energy consumption, 28 Institute for Energy and Economy of Japan, 70 intelligent lighting and cooling system, 15 International Cooperation for Energy Efficiency and Conservation, 70 J Japan assistance to Asian countries, 1

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Index

93

diversification of energy sources, 24 examples of energy-saving technologies, 11 final energy consumption and real GDP, 25 improvement of primary energy consumption per GDP, 4 incentives for energy efficiency, 43 international cooperation in EEC for Asia, 77 office buildings, energy consumption in, 11 present energy consumption, 22–39 promotion of research and development, 11 Japan-China Energy Conservation and Environment Forum, 76 Japan Electronics and Information Technology Industries Association, 56 Japan government financial support for newly developed energy-saving technology, 11 target for energy conservation, 2

03 Energy Efficiency Index

93

Japan Industrial Association of Gas and Kerosene Appliances, 56 Japanese energy conservation technologies, 9 Japanese energy-saving technology Kanban process, 10 Smart Office Environment System, 14 K Kanban process, 10 L labelling program appliance retailers, 53 Latent-Heat Recovery Boiler, 57 Law concerning the Rational Use of Energy, 39 M METI, 67 Strategy for Energy Conservation Technology, 67 Middle East decreasing dependency on oil from, 28 rising dependency on crude oil from, 29 Ministry of Environment, 67

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94

Index

Ministry of Land Infrastructure and Transport, 67 N National Environmental Agency (NEA), 87 National Police Agency, 67 New Additional Energy Strategy (2007), 80 New Energy Development Organization (NEDO), 76 New National Energy Strategy, 67, 84

Japan, 4 per GDP, 3, 27 production technologies close integration with energy-conservation technologies, 9

O office buildings Singapore, 13 oil refineries cost of construction, 7 United States, 8 Oil Shock effect in Japan, 1, 2

R reinforced energy conservation measures, 59 residential sector energy consumption, 32 energy consumption in major developed countries, 33 reinforced energy conservation measures, 59 rise in energy consumption, 28 residential sectors application of Energy Conservation Law, 54

P petrochemical industrial complexes, 43 policy dialogues Japan and Chinese Energy ministers, 76 primary energy consumption certain countries, 5

S Second East Asia Summit, 80 Singapore air-conditioning in office buildings, 13 green labels, 87 Smart Office Environment System, 14, 16

03 Energy Efficiency Index

94

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Index

95

standby energy consumption, 35, 38 voluntary programme to reduce, 56 Strategy for Energy Conservation Technology, 67 T Task Ambient AirConditioning System, 17 Top Runner Program, 46, 47 energy saving for products with, 48 example of improvement (gasoline cars), 49 Top Runner Standard, 11 traffic management measures, 69 transportation sector energy consumption, 40 energy consumption intensity, 41 increase in energy consumption, 39

03 Energy Efficiency Index

95

U Uniform Energy Saving Label, 50, 52 United States biomass ethanol, 7 energy efficiency, 2 Energy Policy Act, 7, 2005 Katrina Shock, 2 paradigm shift, 2 summary of oil refineries, 8 wasteful consumption of energy, 9 V voluntary programme reduction of standby energy consumption, 56 W waste-heat recovery mechanism, 43 world energy demands perspective of, 71

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