1 evaluation of energy paths for the dprk asian energy security (aes)/east asia energy futures...
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EVALUATION OF ENERGY EVALUATION OF ENERGY PATHS FOR THE DPRKPATHS FOR THE DPRK
Asian Energy Security (AES)/East Asia Energy Futures (EAEF) Project
Fifth Asian Energy Security Fifth Asian Energy Security WorkshopWorkshop
12 to 14 May, 2004, Beijing, China
David Von Hippel, Senior AssociateNautilus Institute for Security and Sustainable Development
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OUTLINE OF PRESENTATION: Background to DPRK Energy Analyses
History and general analytical approach Preparation and Analysis of Energy Paths for
the DPRK—National and Regional Goals and philosophy in preparing paths Overall Approach and Scope
Descriptions of Paths Considered “Recent Trends” Path “Redevelopment” Path “Sustainable Development” Path “Regional Alternative” Path
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OUTLINE OF PRESENTATION:
Selected Details of Modeling Approach by Path Selected Draft Results of Analysis of Future
Energy Paths for the DPRK Energy Demand Fuel Supply/Transformation Energy Imports and Exports Costs Environmental Emissions
Initial Lessons Learned from Analysis Next Steps in Analysis of Energy Futures for the
DPRK
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PREVIOUS AND ONGOING NAUTILUS INSTITUTE DPRK ENERGY WORK
1986-94: Nuclear Weapons/Proliferation Issues 1992-97: UN Energy-Environment Missions 1995: DPRK Energy Supply/Demand and
Energy Efficiency Study 1996: KEDO-HFO Supply and Demand Study 1997: Supply and Demand for Electricity in the
DPRK--1990, 1996, and Future Paths 1997: Spent Fuel Scenarios for East Asia 1997-02: DPRK Village Energy Project, Study
Tours, and Proposal Collaboration 2002: Update to 2000 base year
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PREVIOUS AND ONGOING NAUTILUS INSTITUTE DPRK ENERGY WORK
OVERALL APPROACH TO DPRK ENERGY SECTOR ANALYTICAL WORK
Obtain as much information as possible about the DPRK economy and energy sector from media sources, visitors to the DPRK, and other sources
Use available information, comparative analysis, and judgment to assemble a coherent and consistent picture of the DPRK energy sector
Think about possible future paths for DPRK energy sector and economy, what changes (national, regional, global) might bring those paths about, what changes might mean at end-use, infrastructure levels
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PREPARATION AND ANALYSIS OF ENERGY PATHS FOR THE DPRK
Goals of Paths Analysis Assemble plausible, internally-consistent
alternative energy paths for the DPRK, based on the best information available
Explore, in a quantitative manner whenever possible (but not exclusively) the relative energy security implications of the different paths, including the implications of energy sector cooperation between countries of Northeast Asia
Use energy paths as focus, starting point for discussions of how regional/other actors might assist in sustainable re-development of DPRK energy sector
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PREPARATION AND ANALYSIS OF ENERGY PATHS FOR THE DPRK
Philosophy in Paths Preparation/Evaluation Design paths that are plausible, and, under the right
conditions, potentially achievable At the same time, paths shown are not intended in
any way to judge what should happen Paths are built upon best, most internally-consistent
DPRK information we can find, but there are undoubtedly many inaccuracies in the analysis
We look forward to working with DPRK colleagues to improve analysis, make more applicable
Paths are therefore a starting point for further discussion and analysis
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PREPARATION AND ANALYSIS OF ENERGY PATHS FOR THE DPRK
Overall Approach in Paths Preparation/Evaluation Start with older DPRK LEAP dataset that includes
several paths evaluated briefly in previous work Update data set to reflect most recent Nautilus
estimates of 1996 and 2000 DPRK energy use (overall analysis period for paths, 1990 to 2025)
Develop overall “themes” for several (4) paths to be evaluated
Identify specific assumptions for use in implementing the themes within LEAP
Modify paths so that all paths have the same 2005 energy picture
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PREPARATION AND ANALYSIS OF ENERGY PATHS FOR THE DPRK
Overall Approach in Paths Preparation/Evaluation Prepare demand-side data entries (and document
assumptions in Excel workbook) Enter demand-side assumptions in LEAP De-bug demand-side datasets Prepare approximate supply-side data entries (and
document in Excel workbook) Enter supply-side assumptions in LEAP, calculate, and
modify parameters so that supply and demand balance Enter cost and environmental data for all paths Run all paths, check results, debug, re-run, and
evaluate relative demand, transformation, cost, environmental results of paths
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DPRK ENERGY PATHS CONSIDERED
“Redevelopment” Path Used as National Reference path for DPRK Current political stalemate solved within next few
years, DPRK receives international assistance/cooperation in redevelopment
Industrial sector is revitalized, but mostly not rebuilt as it was before More iron and steel from scrap, efficiency improvements in
iron and steel, cement Most industry 50% of 1990 output by 2015, growth at
1.5%/yr thereafter; textiles, fertilizer higher Natural gas begins to be used in industry ~2015
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DPRK ENERGY PATHS CONSIDERED
“Redevelopment” Path (continued) Considerable increase in new light-industrial production
(IT, auto parts, joint ventures…) Increase in diesel, electricity use for light industry
Agricultural sector re-mechanized Cropped area decreases, but electricity, oil use in agriculture
increases (coal/biomass use decreases) Increase in residential electricity consumption
Fraction of population in urban areas increase Consumption of electricity, LPG, kerosene increase, NG use
begins, coal use declines Commercial sector expands rapidly
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DPRK ENERGY PATHS CONSIDERED
“Redevelopment” Path (continued) Transport sector, particularly personal transport,
expands markedly Civilian auto, plane, train, bus transport per person rise Efficiency improvements in road, rail transport modes
Military ground forces activity decreases Energy efficiency in military sector improves
Investment in new electricity infrastructure New coal, gas combined-cycle, some rehabilitation of
older plants, particularly hydro, new small hydro, existing coal plants retired over time, KEDO reactors completed 2013 (export power)
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DPRK ENERGY PATHS CONSIDERED
“Redevelopment” Path (continued) Re-investment in East Coast refinery
Back on line by 2012, expanded 2015, with power plant expanded as well
Oil products imported as needed to meet demand above domestic refining output
Natural gas, first as LNG, begins to play a role in powering industry, electricity generation, urban residences starting in about 2012 Smaller LNG terminal built (Nampo?), part of output exported
Coal/Coke Exports/Imports at 2000 levels
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DPRK ENERGY PATHS CONSIDERED
“Recent Trends” Path Assumes that current political difficuties remain,
or are addressed only very slowly DPRK economy opens a very little, aid flows
modest, infrastructure erodes Very gradual increase in industrial output relative
to 2000 (after 2005) Industrial energy intensities remain high Other Minerals (magnesite) production increases
Transport activity increases slowly Civilian auto transport grows most
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DPRK ENERGY PATHS CONSIDERED
“Recent Trends” Path (continued) Residential energy demand increases slowly
Continued emphasis on coal, but electricity gradually more available
Some modernization/re-mechanization of the agricultural sector Fertilizer, oil, electricity use up slightly over time Cropped area doesn’t change
Fisheries effort increases slowly Military sector energy use, activity change little Commercial sector floorspace, electricity/coal use grow
somewhat
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DPRK ENERGY PATHS CONSIDERED
“Recent Trends” Path (continued) Transmission and distribution losses remain high
through 2015, decrease slightly after 2015 Fraction of fuel inputs to coal-fired power plants as
HFO declines with end of KEDO oil deliveries 10 MW of small hydro power plants are added
each year from 2005 on Total capacity at existing hydro and oil-fired power
plants does not change over time Coal-fired capacity meets net electricity demand after
hydro, oil-fired plant output are factored in. KEDO nuclear reactors not completed
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DPRK ENERGY PATHS CONSIDERED
“Recent Trends” Path (continued) Imports of heavy fuel oil via KEDO cease in 2003. Other oil products (and HFO from elsewhere)
continue to be imported at year 2000 levels West Coast refineries continue to operate
Output increases slightly over time to cover demand net of imports
Coal and coke imports and exports remain the same as in 2000 throughout the period modeled.
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DPRK ENERGY PATHS CONSIDERED
“Sustainable Development” Path (National Alternative Path)
Provides the same energy services as “Redevelopment” Path—with same demographic assumptions, economic output—but…
Applies energy efficiency, renewable energy, other measures, in an aggressive fashion Upgrading of industrial infrastructure goes above
average standards to high-efficiency international standards
Rapid phase-out of existing coal-fired power plants. Earlier addition of LNG (liquefied natural gas) terminal
and gas CC (combined cycle) generating plants
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DPRK ENERGY PATHS CONSIDERED
“Sustainable Development” Path (continued) Industrial sector modifications
Industrial boiler improvements (25 percent by 2025) Improvements in motors and drives/motor systems Substitution of gas (15% by 2025) for coal to produce
process heat in most industries Transport sector modifications
Diesel/gasoline truck/bus efficiency, diesel train efficiency, improved 25% by 2025
Improvements in electric rail efficiency (27% by 2025) Introduction of gasoline, CNG, hydrogen hybrid
vehicles (starting in 2010/2015/2020) in civilian autos
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DPRK ENERGY PATHS CONSIDERED
“Sustainable Development” Path (continued) Residential sector modifications
Domestic coal boiler/stove/heater improvements In urban subsector, more switching from coal to natural
gas and district heat. Urban/Rural residential building shell improvements,
resulting in savings of coal, coal and biomass fuels Electric lighting and appliance efficiency improvements
Agricultural Sector modifications Improvements in efficiency of diesel fuel use per hectare
of land cropped; improvements in boilers used to produce heat for processing of farm products, electric pump/machinery improvements
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DPRK ENERGY PATHS CONSIDERED
“Sustainable Development” Path (continued) Fisheries Sector Modifications
Improvements in efficiency of diesel fuel use per unit of fisheries effort; improvements in electric motor/drive systems used in fisheries products processing
Military Sector Modifications Improvement in efficiency of land vehicles, diesel-
fueled naval vessels Improvement in coal-fired boilers, electric motors and
drives in Military Manufacturing subsector; improvement in coal-fired boilers, building envelopes, electric motors and drives Buildings/Other subsectors
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DPRK ENERGY PATHS CONSIDERED
“Sustainable Development” Path (continued) Public and Commercial Sectors Modifications
Improvement in coal-fired boilers, building envelope improvements, and overall electricity use improvement
Electricity Generation Modifications Accelerated phase-out of existing coal-fired generating
capacity (all 2005 capacity retired by 2025) The addition of an integrated-gasification combined-cycle
(IGCC ) generating plant in 2020 (300 MW) Aggressive wind power development, new small/ medium
hydro, focus on refurbishment of existing hydro Less new coal-fired and gas combined-cycle capacity is
built, especially in the years 2015 to 2025
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DPRK ENERGY PATHS CONSIDERED
“Sustainable Development” Path (continued) Other Transformation Modifications
Additional district heating capacity is built to provide for expanded residential sector use
LNG capacity is built earlier (first phase started in 2010, and second and third phases brought on line one year earlier) than in the Redevelopment case, but the same final capacity is in place by 2025 as in the Redevelopment path
Costs Cost estimates included for all demand end-uses,
transformation processes, and fuels whose use changes relative to the Redevelopment case
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DPRK ENERGY PATHS CONSIDERED
“Regional Alternative” Path Follows modifications identified for the DPRK in
Regional Alternative paths document Demand-sector Modifications
As a result of regional cooperation, efficiency improvement targets reached two years earlier at costs 10% less than in Sustainable Development path
Costs of cooperation reflected as module cost Transformation-sector Modifications
Gas pipeline from RFE begins operation in 2011; 3% of gas used in DPRK initially, 10% by 2020, 15% by 2030
DPRK gets $10 million/yr “rent” for hosting the pipeline
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DPRK ENERGY PATHS CONSIDERED
“Regional Alternative” Path (continued) Transformation-sector Modifications (continued)
LNG facility roughly 3 times larger than in Redevelopment case starts operation in 2012; most output exported to the ROK
A power line from the Russian Far East through the DPRK to ROK is modeled as importing 100 MW of power to DPRK at discounted price of $0.02/ kWh
Participation in regional cooperative activities related to nuclear research and to nuclear waste handling, with annual costs (most possibly in-kind) to the DPRK from 2006
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DPRK ENERGY PATHS CONSIDERED
“Regional Alternative” Path (continued) Transformation-sector Modifications (continued)
Cooperation in renewable energy technologies with annual costs to the DPRK from 2007 on, earlier deployment,10% reduction in cost of wind, small hydro technologies
Some changes in the schedule of additions of new coal-fired plants and gas-fired plants occurs
Last of the coal-fired plants existing as of 2005 are retired in 2020
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DPRK ENERGY PATHS: SELECTED DRAFT RESULTS
DPRK Total Final Energy Use by Path
0
200
400
600
800
1,000
1,200
1,400
1,600
1,800
1990 1996 2000 2005 2010 2015 2020 2025
Mill
ion
GJ
Redevelopment
Recent Trends
Sustainable Development
Regional Alternative
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DPRK ENERGY PATHS: SELECTED DRAFT RESULTS
Final Energy Use by Sector: Redevelopment Case
0
200
400
600
800
1000
1200
1400
1600
1800
1990
1992
1994
1996
1998
2000
2002
2004
2006
2008
2010
2012
2014
2016
2018
2020
2022
2024
Mill
ion
GJ
Industrial Transport
Residential AgriculturalFisheries Military
Public&Commercial NonspecifiedNonEnergy
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DPRK ENERGY PATHS: SELECTED DRAFT RESULTS
Final Energy Use by Fuel: Redevelopment Case
0
200
400
600
800
1000
1200
1400
1600
1800
1990
1992
1994
1996
1998
2000
2002
2004
2006
2008
2010
2012
2014
2016
2018
2020
2022
2024
Mill
ion
GJ
VEGETAL WASTES RESIDUALFUELOILOTHER PETRO PROD NATURAL GASLPGBOTTLED GAS KEROSENEJETFUELHYDROGEN HEAT DISTRICTGASOLINE FIREWOODELECTRICITY DIESELGAS OILCommercial Wood COKING COALCOKECOAL AVG DOMES. CHARCOALAVIATION GAS
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DPRK ENERGY PATHS: SELECTED DRAFT RESULTS
DPRK Total Final Electricity Use by Path
0
5
10
15
20
25
30
35
40
45
50
1990 1996 2000 2005 2010 2015 2020 2025
TW
h
Redevelopment
Recent Trends
Sustainable Development
Regional Alternative
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DPRK ENERGY PATHS: SELECTED DRAFT RESULTS
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DPRK ENERGY PATHS: SELECTED DRAFT RESULTS
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DPRK ENERGY PATHS: SELECTED DRAFT RESULTS
Reserve Margin by Path: DPRK Electricity Sector
0
50
100
150
200
250
300
1990
1992
1994
1996
1998
2000
2002
2004
2006
2008
2010
2012
2014
2016
2018
2020
2022
2024
Pe
rce
nt
Sustainable DevelopmentRegional Alternative TotalRedevelopment CaseRecent Trends Case
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DPRK ENERGY PATHS: SELECTED DRAFT RESULTS
Generation Capacity Summary: Redevelopment Path
0
2,000
4,000
6,000
8,000
10,000
12,000
14,000
16,000
1990
1992
1994
1996
1998
2000
2002
2004
2006
2008
2010
2012
2014
2016
2018
2020
2022
2024
MW
Existing Coal Existing OilExpanded Oil Large HydroKEDO LWR New CoalSmall Hydro Oil CCGas CC
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DPRK ENERGY PATHS: SELECTED DRAFT RESULTS
Generation Capacity Summary: Sustainable Development Path
0
2,000
4,000
6,000
8,000
10,000
12,000
1990
1992
1994
1996
1998
2000
2002
2004
2006
2008
2010
2012
2014
2016
2018
2020
2022
2024
MW
Existing Coal Existing OilExpanded Oil Large HydroKEDO LWR New CoalSmall Hydro Oil CCGas CC IGCC
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DPRK ENERGY PATHS: SELECTED DRAFT RESULTS
Global Warming Potential by Case
0
5
10
15
20
25
30
35
40
1990
1992
1994
1996
1998
2000
2002
2004
2006
2008
2010
2012
2014
2016
2018
2020
2022
2024
Mill
ion
To
nn
es
C E
qu
iv.
Sustainable Development
Regional Alternative Total
Redevelopment Case
Recent Trends Case
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DPRK ENERGY PATHS: SELECTED DRAFT RESULTS
Relative Cost (NPV) Relative to Redevelopment Case
($1,200)
($1,000)
($800)
($600)
($400)
($200)
$0
$200
$400
$600
$800
$1,000
Demand Transformation Resources Total Net Costs
Mill
ion
US
D (
Ne
t P
res
en
t V
alu
e)
Sustainable Development Case
Regional Alternative Case
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DPRK ENERGY PATHS: INITIAL CONCLUSIONS FROM RESULTS
Sustainable Development Case indicates significant reductions in energy use, emissions, are possible relative to Redevelopment Case, and…
Net costs of those reductions may be relatively small or even negative May offer opportunity for application of Clean
Development Mechanisms to share costs, carbon credits
Regional Alternative Case offers similar benefits, but net costs very dependent on resource prices
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NEXT STEPS IN DPRK ENERGY PATHS ANALYSIS
Next Steps on DPRK Paths Analysis Refine and improve reference cost and performance
assumptions, particularly on the demand side, but for transformation, resources as well (Regional Alternatives)
Additional debugging of dataset Sensitivity analysis (key costs, prices) Consideration of non-quantitative impacts on energy
security Consideration of other path variants
Work with DPRK Colleagues to Improve Analysis, Fully Implement in DPRK