Characteristic analysis and forecast of electricity supply and demand in APEC

1 Introduction

The Asia-Pacific Economic Cooperation (APEC) is a group of 21 economies located in the Asia-Pacific region that are dedicated to achieving shared prosperity through economic growth and free trade.The forum was formed in 1989 as an informal dialogue among government officials from 12 economies,and its membership and scope has expanded to 21 economies since then.The member economies have a combined population of about 2.9 billion people.In 2017,the APEC accounted for 60% of gross domestic product (GDP) and 47% of the world trade [1,2].

According to the International Renewable Energy Agency (IEA),in 2016,the worldwide total primary energy supply and final energy consumption were 13,081 Mtoe and 9,556 Mtoe,respectively [3,4],of which those of the APEC were 7,891.81 Mtoe and 4,736.61 Mtoe,thus accounting for 60.3% and 50.0%,respectively,of the worldwide totals (Fig.1) [2].From 1990 to 2016,as a result of the rapid economic growth,primary energy supply and final energy consumption increased rapidly in the APEC region,with an average annual growth rate of about 2.5% and 2.1%,respectively.As of 2016,coal,oil,and natural gas constitute the main primary energy sources,accounting for 35.4%,29.5%,and 21.7%,respectively,while coal,oil,natural gas and electricity constitute the main final energy consumption,accounting for 16.4%,35.4%,14.9%,and 24.3%,respectively.Coal supply and consumption peaked in 2011 and then began to decline.Renewable energy (RE) and electricity have been on an upward trend in both primary energy supply and final energy consumption,with an average annual growth rate of about 4.3% and 4.8%,respectively,between 1990-2016.But the share of RE is still far below fossil energy,which was less than 8% by the end of 2016.

China,the United States,Russia and Japan are the top 4 energy markets (Fig.2) [2],respectively accounting for 36.5%,27.5%,9.3%,5.4% in total primary energy supply and 36.7%,29.4%,8.2%,5.5% in total final energy consumption in 2016.

In terms of primary energy supply,the coal share is above 25% in 6 economies:China (65.6%),Hong Kong Special Administrative Region (HKSAR) (46.5%),Vietnam (40.2%),Chinese Taipei (34.1%),Australia (33.7%),Korea (28.9%) and Japan (27.4%).Except for Vietnam (28.1%),HKSAR (25.8%),Russia (23.7%),China (19.0%),and Brunei (15.9%),the oil share in other economies is over 30%.The natural gas share is over 25% in 10 economies:Brunei (84.1%),Russia (50.7%),Mexico (35.7%),Malaysia (34.8%),Canada (33.8%),Singapore (32.0%),Peru (31.2%),the United States (30.1%),Thailand (29.8%),and Australia (26.6%).The RE share of primary energy supply is above 10% in only 9 economies,which are New Zealand (41.6%),the Philippines (36.9%),Indonesia (28.0%),Chile (27.1%),Peru (21.1%),Thailand (20.2%),Vietnam (19.5%),Canada (17.5%),and Papua New Guinea (14.1%).

In terms of final energy consumption,the electricity share is above 25% in 10 economies:HKSAR (55.8%),Chinese Taipei (42.5%),Singapore (37.5%),Korea (34.5%),Brunei (32.8%),Japan (32.0%),Malaysia (27.3%),Vietnam (26.8%),New Zealand (25.4%),and China (25.3%).Indonesia has the lowest share of electricity consumption,at a mere 12.1%.Oil is the primary type of final energy consumed; except in China (23.8%) and Russia (22.4%),the oil share in the other APEC economies is over 30%.The natural gas share is over 25% in 10 economies:Russia (30.1%),Canada (25.4%),the United States (23.0%),Korea (16.7%),Australia (16.2%),New Zealand (12.8%),Malaysia (12.1%),Mexico (11.8%),Japan (11.1%),and Singapore (10.5%).The coal share is above 10% in 4 economies,which are China (37.4%),Vietnam (22.8%),Chinese Taipei (15.9%),and Japan (12.4%).

Fig.1 Total primary energy supply and final energy consumption of APEC by sources (1990-2016)

Fig.2 Primary energy supply and final energy consumption of APEC economies by source (2016)

2 Electricity supply and demand of APEC

2.1 Electricity generating capacity and generation

According to the IEA,in 2016,the total electricity generation worldwide was 25,082 TWh [5],and the APEC’s total electricity generating capacity and generation were 4,019.15 GW and 15,791.04 TWh,respectively (Fig.3) [2],accounting for 63.0% of the world’s electricity generation.From 2006 to 2016,electricity generating capacity and generation increased rapidly in the APEC regions,with an average annual growth rate of about 3.3% and 4.9%,respectively.Thermal power is the biggest part of electricity generation; in 2016,coal and oil accounted for 47.2% and 21.8% of it,respectively,and their shares continue to grow slowly.While nuclear power is declining,RE is growing rapidly; in 2016,their respective electricity generation shares were found to be 10% and about 20%.Non-hydro RE is growing the fastest,with an average annual growth rate of about 117.7% and 29.7% in electricity generating capacity and generation,respectively,between 2006-2016.China,the United States,Japan and Russia are the top 4 electricity consumption markets (Fig.4) [2],accounting for 38.9%,27.2%,6.7%,6.9% in total electricity generating capacity and 41.0%,27.2%,7.5%,6.4% in total electricity generation in 2016 respectively.

In terms of electricity generating capacity,except for Canada (24.4%) and New Zealand (23.9%),the thermal power share of other economies is over 55%.The hydro power share is over 25% in 6 economies:New Zealand (57.5%),Canada (55.7%),Vietnam (43.1%),Peru (37.0%),Papua New Guinea (29.0%),and Chile (27.1%).Only eight economies have nuclear power; these include Korea (20.8%),Japan (3.9%),Chinese Taipei (10.3%),Russia (10.2%),Canada (9.7%),the United States (9.1%),Mexico (2.2%),and China (2.0%).The non-hydro RE share is over 10% in 8 economies:Indonesia (19.9%),New Zealand (18.6%),the Philippines (15.6%),Australia (13.8%),China (13.6%),Thailand (12.6%),the United States (11.0%),and Canada (10.2%).

In terms of electricity generation,coal and natural gas are the dominant sources; the share of coal-fired power generation or gas-fired power generation is over 30% in more than half the APEC economies.The hydro power share is over 10% in 9 economies:New Zealand (59.87%),Canada (58.02%),Peru (46.51%),Vietnam (35.44%),Chile (29.35%),Papua New Guinea (22.61%),China (19.43%),Russia (16.95%),and Malaysia (12.78%).Although non-hydro RE has developed rapidly in recent years,its share remains very low.The wind power share is over 3% in only 7 economies:New Zealand (5.36%),the United States (5.34%),Australia (4.76%),Canada (4.61%),China (3.86%),Mexico (3.24%),and Chile (3.09%),and the solar power share is over 3% in only 2 economies:Japan (3.84%) and Chile (3.33%).The geothermal power share is over 3% in only 4 economies:New Zealand (17.28%),the Philippines (12.19%),Papua New Guinea (9.45%),and Indonesia (4.30%).

Fig.3 Total electricity generating capacity and generation of APEC by source (2006-2016)

Fig.4 Electricity generating capacity and generation in APEC economies by source (2016)

2.2 Electricity consumption by end-use sector

Industry,transport,and building (including commercial and public services and residential use) are three main final energy consumption sectors (Fig.5) [2],accounting for about 39.0%,29.5%,and 26.6% of consumption,respectively,in 2016.However,transport is not a primary electricity consumption sector,as its share is only 2.0%.Industry,commercial and public services,and residential use accounts for about 45.5%,20.4%,and 25.4% of electricity consumption,respectively,in 2016.The industry sector has the largest electricity consumption share and shows an upward trend.

In 7 economies,the industry sector share of electricity consumption is over 50% (Fig.6) [2]; these economies are China (65.73%),Chile (62.16%),Peru (60.15%),Chinese Taipei (57.38%),Mexico (53.98%),Vietnam (53.81%),and Korea (51.30%).The building sector share of electricity consumption is over 50% in 12 economies:Brunei (95.00%),HKSAR (92.64%),the United States (72.75%),Indonesia (68.35%),the Philippines (63.92%),Australia (59.72%),Canada (58.96%),Thailand (58.12%),Japan (57.51%),New Zealand (56.67%),Singapore (55.01%),and Malaysia (52.41%).

Fig.5 Total final energy and electricity consumption of APEC by sector (2006-2016)

Fig.6 Electricity consumption share of APEC economies by sector (2016)

2.3 Access to electricity

The 21 APEC member economies are at different stages of development; as a result,part of the population in some economies does not have access to electricity yet.According to World Bank statistics,as of the end of 2017,there are still four APEC economies in which access to electricity has not yet reached 100%; the total population without access to electricity is 16.93 million (Fig.7) [6].

In particular,in Papua New Guinea,only 54.43% of the population has access to electricity,leaving about 3.68 million people without it.The other three economies are the Philippines (93.00%),Peru (96.36%),and Indonesia (98.14%); the corresponding populations without access to electricity are about 7.23,1.16,and 4.86 million,respectively.

2.4 Annual per capita electricity consumption

Fig.7 Access to electricity of APEC economies (2017)

According to the United Nations and the IEA,in 2016,the world average annual per capita electricity generation and GDP were 3,360.4 kWh and 10,665.0 USD,respectively,while those of the APEC were 5,500.7 kWh and 15,791.0 USD,respectively,which is about 1.5 times the world average (Fig.8) [7-9].

The annual per capita electricity consumption is directly proportional to the annual per capita GDP.The annual per capita electricity generation is over 10,000 kWh in six economies:Canada (18,397.9 kWh),the United States (13,291.2 kWh),Chinese Taipei (11,231.0 kWh),Brunei (11,212.3),Korea (10,882.3 kWh),and Australia (10,595.7 kWh).The corresponding annual per capita GDP is over 20,000 USD,far beyond the world and APEC averages.

The annual per capita electricity generation is below the world average in seven economies:Thailand (2,724.8 kWh),Mexico (2,511.8 kWh),Vietnam (1,907.1 kWh),Peru (1,635.6 kWh),Indonesia (949.5 kWh),the Philippines (878.8 kWh),and Papua New Guinea (549.8 kWh).The corresponding annual per capita GDP is far below the world and APEC averages.In particular,the annual per capita electricity generation in Papua New Guinea,the Philippines,Indonesia,and Peru is less than half of the world average.

3 Renewable energy and electricity generation trends in APEC

3.1 APEC targets doubling of renewable energy

Fig.8 Annual per capita electricity generation and GDP of APEC economies (2016)

To keep pace with the rising demand and ease the environmental impact of economic development across the Asia-Pacific,in the 2014 APEC Energy Ministerial Meeting,the APEC proposed the target of “doubling the share of renewables in the APEC energy mix,including in power generation,from 2010 levels by 2030” [10].As per the 57th APEC Energy Working Group Meeting [11],the RE share in primary energy supply increased from 4.80% in 2010 to 6.29% in 2016,a mere 1.49% increase from 2010 to 2016,leaving it at only 31.1% of the target.The RE share in final energy consumption increased from 6.17% in 2010 to 7.79% in 2016,a 1.62% increase from 2010 to 2016,only 26.3% of the way to the goal.To reach the APEC renewable energy doubling target,the APEC economies need to significantly accelerate RE development.

Table 1 summarizes the RE policies and RE power targets in all 21 APEC economies [12].Power targets with an RE share of over 10% were proposed by 13 economies:Brunei,Chile,China,Indonesia,Japan,Korea,Malaysia,Mexico,New Zealand,Papua New Guinea,Chinese Taipei,Thailand and Vietnam.

Table 1 Selected APEC renewable energy policies

Economy Most influential policy framework Renewable energy target in terms of power Australia Australia’s Renewable Energy Target (2001) 33 TWh by 2020 Brunei Energy White Paper (2014) 10% of generation by 2035 Canada Pan-Canadian Framework on Clean Growth and Climate Change (2016) —Chile Energy 2050 (2015); Energy Roadmap (2015) Minimum of 60% by 2035 and 70% by 2050 China 13th Five-Year Plan,2016-2020 15% by 2020 and 20% by 2030 in final energy mix HKSAR Future Fuel Mix for Electricity Generation Consultation Document (2015) Fuel mix 1% (2023)Indonesia Presidential Regulation 22/2017 General Plan of National Energy (2015-50)Renewable electricity as a share of TPES:11% in 2025 and 17% in 2050 Japan 4th Strategic Energy Plan (2014); Long-term Energy Supply and Demand Outlook (2015) 22%～24% of generation by 2030 Korea 4th National Basic Plan for New and Renewable Energy (2014); 8th Electricity Demand and Supply Basic Plan (2017) 20% generation and 34% capacity by 2030 Malaysia National Renewable Energy Policy and Action Plan (2009); Renewable Energy Act(2011); Sustainable Energy Development Authority Act (2011); 11th Malaysia Plan (2016-2020); National Biofuel Policy (2006)7.8% of generation and 11% of capacity by 2020,17% of generation by 2030,and 21 GW of capacity by 2050 Mexico Mexico’s Energy Transition Law (2015) At least 35% of generation by 2024 and 50% by 2050 New Zealand New Zealand Energy Strategy 2011-2021; National Policy Statement for Renewable Electricity Generation (2011); Climate Change Response (Emissions Trading) Amendment Act 2008 90% of generation by 2025 Papua New Guinea Vision 2050 (2009) 100% of generation by 2050 Peru Legislative Decree No.1002 Reach 5% share (excluding large hydro) by 2023 Philippines Renewable Energy Act (2008); Biofuels Roadmap 2017-2040; Biofuels Act (2006) 20 GW of capacity by 2040 4%～6% (excluding large hydro) of generation by 2030 Singapore Handbook for PV Systems (2011); White Paper on Renewable Energy (2014)Russia The Basic Directions of a State Policy of Renewable Energy Utilisation up to 2020 (2009); Energy Strategy 2030 (2009)PV reaches ～ 4.5% of peak electricity demand (350 MWp) by 2020 Chinese Taipei Renewable Energy Development Act (2009); New Energy Policy (2016) 20% of generation by 2025 Thailand Alternative Energy Development Plan 2015-2036 (AEDP) 30% of generation by 2036 United States US Energy Independence and Security Act (2007); RPS:29 states+Washington,DC+3 territories,RPG:8 states and 1 territory RPS up to 100% (2045 in Hawaii); 50% (2030 in California,New York,New Jersey); 50% (2040 in Oregon)Vietnam Renewable Energy Development Strategy (2015); Biofuels Development Scheme (2007) and Roadmap (2017)38% of generation by 2020,32% by 2030 and 43% by 2050

3.2 Renewable power generation cost

Table 2 shows the global weighted-average electricity cost and installed cost of renewable power [13].The costs for renewable energy technologies reached new lows in 2018.Hydro power is an extremely viable renewable technology because of the low cost of the electricity and the flexibility it can provide to the grid; its electricity cost is 0.047 USD/kWh in 2018,11% lower than in 2017.Solar photovoltaic (PV) and onshore wind power have electricity costs of 0.085 and 0.056 USD/kWh in 2018 respectively,13% lower than in 2017; they are on the verge of costing less than the operating costs of existing coal-fired plants.

Table 2 Global weighted-average electricity cost and installation cost of renewable power in 2018

Change in installation cost 2017-2018 Bioenergy 0.062-14%——Geothermal 0.072-1%——Hydro 0.047-11%——Solar PV 0.085 -13% 1,210 -13%CSP 0.185 -26% 5,204 -28%Offshore wind 0.127 -1% 4,353 -6%Onshore wind 0.056 -13% 1,497 -6%Renewable power Electricity cost (USD/kWh)2018 Change in electricity cost 2017-2018 Installation cost (USD/kW)2018

The cost of electricity from both geothermal and offshore wind projects has declined slightly,by about 1% in 2018.The electricity and installation costs of concentrated solar power (CSP) declined by 26% and 28%,respectively,in 2018; although this is the most significant decline in cost,it remains the costliest RE source.Steady increase in market competition has made RE the backbone of the world’s energy transformation.

3.3 Primary energy supply of APEC by 2030

Using top-down methodologies,Asia Pacific Energy Research Centre (APERC) carried out scenario analysis of APEC energy and supply [12].Taking 2016 as the base year,the models use consistent assumptions (GDP,population,energy prices).Energy projections are demanddriven and the supply model balances flows.Three scenarios were analyzed:

(1) Bussiness-As-Uaual (BAU):The BAU scenario reflects current policies and trends within the APEC energy sector.In turn,it largely projects past trends into the future.

(2) APEC Targets (TGT):The TGT scenario is driven by APEC’s goals of reducing energy intensity while increasing the share of renewables.

(3) Two Degrees Celsius Scenario (2DC):The 2DC is inspired by the COP21 declaration:“Holding the increase in the global average temperature to well below 2DC above pre-industrial levels”.The 2DC generally follows the carbon emissions reduction pathway included in the Energy Technology Perspectives (ETP) publication by the International Energy Agency.This pathway provides a 50% chance of limiting average global temperature increases to 2 degrees Celsius.

According to scenario analysis by the APERC [12],under the business-as-usual (BAU) scenario,APEC target (TGT) scenario,and 2 degrees Celsius (2DS) scenario,the primary energy supply of APEC by 2030 will reach 8,927.8,8,282.1 and 7,585.2 Mtoe,respectively.In the three scenarios,coal,oil and natural gas would remain the dominant primary energy supply.The total share of fossil energy would be no less than 75% (Fig.9).

Fig.9 Primary energy supply of APEC (2030) in BAU,TGT,and 2DC scenarios

In the TGT scenario,the main sources of the net additions of primary energy supply would be RE,nuclear energy,and natural gas,and the predicted net growth would be about 495,260,and 126 Mtoe,respectively,as compared to 2016.The supply of coal and oil is predicted to reduce by about 463 and 75 Mtoe,respectively (Fig.10).

Fig.10 Net additions of primary energy supply of APEC (2030) in TGT scenario

3.4 Electricity generation of APEC by 2030

In the TGT scenario,by 2030,the APEC’s electricity generation and generating capacity would reach 18,417.9 TWh and 5,919.1 GW,an increase of 17% and 47%,respectively,as compared to 2016.The RE share is predicted to account for about 34% of electricity generation and 48% of electricity generating capacity (Fig.11).

Fig.11 Electricity generation and generating capacity of APEC (2030) in TGT scenario

In the TGT scenario,the primary sources of the net additions of electricity generation capacity would be solar,wind,and hydro power,as well as natural gas,and the predicted net growth would be about 963,497,157,and 252 GW,respectively,as compared to 2016.Coal-fired and oilfired power generating capacity would not change significantly,but the utilization hour would decline,and as a result,the electricity generation by coal and oil would have a net decrease of about 1,129 and 165 TWh,respectively (Fig.12).

Fig.12 Net additions of electricity generation of APEC (2030) in TGT scenario

4 Conclusions

In this study,the characteristics of electricity supply and demand in APEC economies were analyzed and the renewable energy and electricity generation projections up to 2030 based on trends in the APEC were assessed.Based on our findings,the following conclusions could be made:

(1) Coal,oil,and natural gas are the dominant primary energy sources,accounting for 35.4%,29.5%,and 21.7% in 2016,but coal supply and consumption peaked in 2011 and then began to decline.Renewable energy has been on an upward trend; its share in primary energy supply increased from 4.80% (2010) to 6.29% (2016),and that in final energy consumption increased from 6.17% (2010) to 7.79% (2016).

(2) Coal and natural gas are the dominant electricity generation sources; the share of coal-fired power generation or gas-fired power generation is above 30% in over half of the APEC economies.The electricity share in final energy consumption has been on an upward trend,reaching 24.3% in 2016 with an average annual growth rate of about 4.8% between 2006-2016.The industry sector has the largest share in electricity consumption,accounting for about 45.5% of consumption in 2016,with an upward trend.

(3) The annual per capita electricity generation of the APEC was 5,500.7 kWh in 2016,which is about 1.5 times of world average.However,as of the end of 2017,four APEC economies have not yet achieved 100% population access to electricity,including Papua New Guinea (54.43% access),the Philippines (93.00% access),Peru (96.36% access),and Indonesia (98.14% access); the combined total corresponding population without access to electricity is about 16.93 million.

(4) The costs of RE technologies reached new lows in 2018; solar photovoltaic and onshore wind power are on the verge of costing less than the operating cost of existing coalfired plants,with corresponding electricity costs of 0.085 and 0.056 USD/kWh,respectively,in 2018.In the APEC renewable-energy-doubling target scenario,the predicted net growth from 2017 to 2030 of solar,wind,and hydro power is about 963,497,and 157 GW respectively,and to reach the APEC target,the APEC economies need to accelerate renewable energy development.

Acknowledgements

This work was sponsored by the National Key Research and Development Program of China (Grant No.2018YFC0704400) and the Programmer of Introducing Talents (Grant No.B13011).