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Transformation of energy systems for carbon neutrality and the role of innovation ALPS International Symposium Keigo Akimoto Group Leader, Systems Analysis Group Research Institute of Innovative Technology for the Earth (RITE) Toranomon Hills Forum February 13, 2020
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Transformation of energy systems for carbon neutrality and ... · sides (over 400 specific technologies including CCUS are modeled.) Primary energy: coal, oil, natural gas, hydro&geothermal,

May 22, 2020

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Page 1: Transformation of energy systems for carbon neutrality and ... · sides (over 400 specific technologies including CCUS are modeled.) Primary energy: coal, oil, natural gas, hydro&geothermal,

Transformation of energy systems

for carbon neutrality and

the role of innovation

ALPS International Symposium

Keigo AkimotoGroup Leader, Systems Analysis Group

Research Institute of Innovative Technology for the Earth (RITE)

Toranomon Hills Forum

February 13, 2020

Page 2: Transformation of energy systems for carbon neutrality and ... · sides (over 400 specific technologies including CCUS are modeled.) Primary energy: coal, oil, natural gas, hydro&geothermal,

1. The status and ways of climate change response

measures

2. Role and issues of energy storage technologies

3. Potential drastic changes of energy demands

induced by progresses of digitalization

4. Scenario analyses for the carbon neutrality

5. Conclusion

Contents2

Page 3: Transformation of energy systems for carbon neutrality and ... · sides (over 400 specific technologies including CCUS are modeled.) Primary energy: coal, oil, natural gas, hydro&geothermal,

1. The status and ways of climate

change response measures

Page 4: Transformation of energy systems for carbon neutrality and ... · sides (over 400 specific technologies including CCUS are modeled.) Primary energy: coal, oil, natural gas, hydro&geothermal,

Global CO2 emissions

Source: Global Carbon Project

4

- The increase rate of global CO2 emissions has been rapidly since 2000 although some international

frameworks on climate change had been developed such as the Kyoto protocol in 1997.

- Between 2013 and 2016, the emissions were almost constant, because the adjustment for productions

of iron & steel, cement etc. particularly in China, and shale gas in the US had large impacts on the

emissions. After 2017, the emissions are increasing again with finish of the production adjustment.

Page 5: Transformation of energy systems for carbon neutrality and ... · sides (over 400 specific technologies including CCUS are modeled.) Primary energy: coal, oil, natural gas, hydro&geothermal,

5Complexity of Int’l & Domestic Politics

US: Trump Administration

- Announced in June 2007 its intention to withdraw from the Paris Agreement

because of a negative impact on US industry, economy and employment and

its benefits to other countries. ("I was chosen by US citizens, e.g. Pittsburgh,

not the citizens of Paris.")

- Employment issues in manufacturing led to the Trump’s inauguration

- Promoting policies that lower energy prices, e.g. shale gas development and

coal utilization. CO2 emission regulatory policies are being abolished

- Negotiations on the topic of climate was also the most challenging one at the

G20 Osaka with the negative position to the Paris by the President Trump.

France: Movement of yellow vests

- Massive protests began in November 2018 in opposition to the fuel tax

hike. It irked rural residents who do not have valid alternative transport

- By globalization, it appears to be linked to the worsening employment

conditions for manufacturing workers (rural middle class), and has a

similar background to the US Trump’s inauguration and the UK Brexit

The Bolsonaro administration inaugurated in January 2019 in Brazil also dismisses the Paris

Agreement. (Originally, 2019 COP25 was scheduled to be held in Brazil, but changed to Chile

(The venue was changed to Spain due to riots against subway fare increase in Chile))

The COP25 in December 2019, in effect, did not agree on key issue negotiations.

Page 6: Transformation of energy systems for carbon neutrality and ... · sides (over 400 specific technologies including CCUS are modeled.) Primary energy: coal, oil, natural gas, hydro&geothermal,

0

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1

4

12

14

27

33

54

58

70

85

95

144

166

210

378

380

0 50 100 150 200 250 300 350 400

China

Ukraine

India

Turkey

South Africa

Russia

Belarus

Kazakhstan

Mexico

Australia

Thailand

East Europe (Non-EU member)

Norway

United States

New Zealand

Korea

Canada

EU28

Japan

Switzerland

CO2 marginal abatement cost ($/tCO2)

CO2 marginal abatement costs of NDCs:

Additional Costs by non-uniform MACs

- Emission reduction costs are an important indicator for measuring emission reduction efforts.

- The estimated marginal abatement costs of NDCs are largely different among countries, and the

mitigation costs are much larger than those under the least cost measures due to such large difference

in marginal abatement costs.

Source: K. Akimoto et al., Evol. Inst. Econ. Rev., 2016

2030 (2025 for the U.S.)

【World GDP loss due to mitigation】 NDCs:0.38%; the global least cost:0.06%The least cost (equal marginal abatement costs):6$/tCO2

6

Page 7: Transformation of energy systems for carbon neutrality and ... · sides (over 400 specific technologies including CCUS are modeled.) Primary energy: coal, oil, natural gas, hydro&geothermal,

7

Image of global GDP losses for 2 C target and

requirement of disruptive innovations

0%

10%

20%

30%

40%

Least cost(IPCC AR5)

non-uniform MAC amongnations

non-uniform MAC amongsectors within a nation

GD

P loss

2%

5%

(Additional costs due to non-uniform MAC among sectors

within a nation: 1.55.1 time s for Japan, US, and Europe

Additional costs due to non-uniform MACs of NDCs among nations:

about 6.5 times

Requirement

of disruptive

innovations

Page 8: Transformation of energy systems for carbon neutrality and ... · sides (over 400 specific technologies including CCUS are modeled.) Primary energy: coal, oil, natural gas, hydro&geothermal,

Final energy sources are required to be electricity and hydrogen in principle

(+ bioenergy and direct heat use by solar heat etc.). Fuel cells by hydrogen

provide also electricity for final use.

Syn. methane from CO2-free hydrogen and recovered CO2 can be used for

final energy. (In this case, recovered CO2 plays only a carrier for hydrogen

energy.)

Productions of electricity and hydrogen are required to be decarbonized

using renewables, nuclear power, CCS etc.

However, the completely no use of hydrocarbon will be unrealistic, and

therefore, even for carbon neutrality (net zero emissions), some gross

emissions combined with negative emission technologies (NETs) of

forestation, bioenergy with CCS (BECCS), DACS etc. can be accepted as

real world response measures.

Because the scenarios based on strong dependence on NETs will be weak in

achievability and exert high negative impacts on biodiversity, (economically

autonomous) low energy demands will be important for the achievement of

decarbonized society.

The transition to decarbonization is inevitable. Emission reductions should

be implemented, considering total costs of both climate change damages

and mitigation costs on the way to decarbonization.

For Carbon Neutrality8

Page 9: Transformation of energy systems for carbon neutrality and ... · sides (over 400 specific technologies including CCUS are modeled.) Primary energy: coal, oil, natural gas, hydro&geothermal,

Categorization of deep emission reduction scenarios

Source: IPCC SR15

Depend on NETs Low High

SSP1(large expansion of

service industries)

SSP2(Middle scenario)

SSP5(tech. improvement of

fossil fuel mining: large)

LED(Low energy demand scenario;

technological and social

innovation in end-use: large)

The comprehensive risk management is important and different kinds of technologies must

be prepared for the possible deployment under large uncertainties.

Multiple achievement

of SDGs

Relatively high

achievability

Final energy consumption Low High

Mitigation costs (difficulty in mitigation) Low High

Depend on adaptation(under the achievability of mitigation) Low High

Barrier of tech. development

High? High?

Barrier of tech. develop. and deployment

Relatively low

achievability

9

Page 10: Transformation of energy systems for carbon neutrality and ... · sides (over 400 specific technologies including CCUS are modeled.) Primary energy: coal, oil, natural gas, hydro&geothermal,

2. Role and issues of energy

storage technologies

Page 11: Transformation of energy systems for carbon neutrality and ... · sides (over 400 specific technologies including CCUS are modeled.) Primary energy: coal, oil, natural gas, hydro&geothermal,

11Goals of technology development of battery

Source) METI 自動車新時代戦略会議資料

The performance of batteries is improving. Much larger improvements are not

visible at present, but will be expected.

Japan Korea

US China

Europe

Innovative battery

Advanced LIB

Current LIB

All solid LIB

Energy density

Page 12: Transformation of energy systems for carbon neutrality and ... · sides (over 400 specific technologies including CCUS are modeled.) Primary energy: coal, oil, natural gas, hydro&geothermal,

12

Electricity storage technologies: cover ranges

Technologies for energy storage will have different advantageous areas.

Source: IEA Technology RoadmapHydrogen and Fuel Cell、2015

Page 13: Transformation of energy systems for carbon neutrality and ... · sides (over 400 specific technologies including CCUS are modeled.) Primary energy: coal, oil, natural gas, hydro&geothermal,

3. Potential drastic changes of

energy demands induced by

progresses of digitalization

Page 14: Transformation of energy systems for carbon neutrality and ... · sides (over 400 specific technologies including CCUS are modeled.) Primary energy: coal, oil, natural gas, hydro&geothermal,

Global Exergy by Sector14

Exergy of primary energy = 100

Required services need only 4-5% of

primary energy consumption.Source) A. Grubler (IIASA), ALPS International Symposium (2016)

There is large room to improve energy productivity in end-use sectors. However, currently

there are large barriers to enjoy the possible productivity improvement because of hidden

costs. IT, AI and other related technologies may overcome the barriers at affordable costs.

Page 15: Transformation of energy systems for carbon neutrality and ... · sides (over 400 specific technologies including CCUS are modeled.) Primary energy: coal, oil, natural gas, hydro&geothermal,

photo

Transport: CASE15

Source) Jari Kauppila, ALPS International Symposium (2019)

EV ”e-Palette” only for Autono-MaaS

Airbus, Audi

Possibility of integration of cars

and near distance airplaneThe sharing may reduce number of cars

and the consumptions of materials, and

change the form of cities.

Changing the shape of cars

Connected; Service & Shared

Autonomous; ElectricOperation ratio of automobiles

is about 5%. The large room for

the improvement exists by the

achievement of fully

autonomous cars.

Page 16: Transformation of energy systems for carbon neutrality and ... · sides (over 400 specific technologies including CCUS are modeled.) Primary energy: coal, oil, natural gas, hydro&geothermal,

Publication16

Progresses of digitization

Reduction of paper medium books and newspaper circulation (Paper reduction,

Embodied energy reduction)

Decrease of physical bookstores (Energy reduction for construction and

maintenance, Energy reduction for access to physical bookstores)

Newspaper delivery declining? (Reduction of transport energy)

Page 17: Transformation of energy systems for carbon neutrality and ... · sides (over 400 specific technologies including CCUS are modeled.) Primary energy: coal, oil, natural gas, hydro&geothermal,

amazon

Apparel17

It is said that 50% of clothes are unused and disposed.

Preference changes especially among young generations, e.g. wearing suits is

not popular among young people, and progress of E-commerce, e.g. anything is

available without traveling.

Just-in-time system using AI / ICT, enabling accurate demand forecast and not

dependent on mass production.

Large spaces for display and huge energy for construction and air conditioning

are needed in large commercial facilities, however, they would be reduced.

As department stores and large commercial complexes become less popular,

there will be less necessity to own cars and it could accelerate car-sharing.

These are technological or social changes not directly driven by global warming countermeasures.

E-commerceincl. used goods

trading or sharing

clothes

Changes in

department stores

and large commercial

complexes

rakuten

Alibaba

mercari

Page 18: Transformation of energy systems for carbon neutrality and ... · sides (over 400 specific technologies including CCUS are modeled.) Primary energy: coal, oil, natural gas, hydro&geothermal,

Food18

It is regarded that approx. 30% of GHG emission (even more depending on

boundaries) comes from food system. Also food wastes and losses are about

one third of total production globally (would be less in Japan).

More accurate food demand forecast through AI / ICT could lead to decrease of

food wastes and losses and to reduction of energy consumption and GHG

emission accordingly.

Consequently, reduction of plastic containers, store spaces in supermarkets,

energy for refrigerators / freezers and transport energy could be triggered.

They could be huge contribution to the achievements of SDGs as well.

Page 19: Transformation of energy systems for carbon neutrality and ... · sides (over 400 specific technologies including CCUS are modeled.) Primary energy: coal, oil, natural gas, hydro&geothermal,

4. Scenario analyses for

the carbon neutrality

Page 20: Transformation of energy systems for carbon neutrality and ... · sides (over 400 specific technologies including CCUS are modeled.) Primary energy: coal, oil, natural gas, hydro&geothermal,

Energy Assessment Model: DNE21+

Linear programming model (minimizing world energy system cost)

Evaluation time period: 2000-2100

World divided into 54 regions

Bottom-up modeling for technologies both in energy supply and demand

sides (over 400 specific technologies including CCUS are modeled.)

Primary energy: coal, oil, natural gas, hydro&geothermal, wind,

photovoltaics, CSP, biomass and nuclear power

Electricity demand and supply are formulated for 4 time periods:

instantaneous peak, peak, intermediate and off-peak periods

Interregional trade: coal, crude oil/oil products, natural gas/syn. gas, syn.

oil, ethanol, hydrogen, electricity and CO2

Existing facility vintages are explicitly modeled.

Representative time points: 2000, 2005, 2010, 2015, 2020, 2025, 2030, 2040, 2050,

2070, 2100

Large area countries are further divided into 3-8 regions, and the world is divided

into 77 regions.

- The model has regional and technological information detailed enough to analyze regional

and sectoral measures. Consistent analyses are obtained across regions and sectors .

20

Page 21: Transformation of energy systems for carbon neutrality and ... · sides (over 400 specific technologies including CCUS are modeled.) Primary energy: coal, oil, natural gas, hydro&geothermal,

Assumed Scenarios21

Scenario

name

Global emission

scenarios

Renewable costs

(PV costs)

Share mobilities acceleration

(Fully autonomous cars)

REF_1 Baseline

(without specific

CO2 emission

constraints)

Mid. cost reduction w.o. consideration

2DS_1 Below 2 C

(>50%):

Corresponding to

IEA ETP2017

[2DS]

Mid. cost reduction w.o. consideration

2DS_2 Low cost particularly

in Middle-East & N.

Africa2DS_3 Share mobilities acceleration

(Fully autonomous cars)

B2DS_1 Well below 2 C

(>66%):

Corresponding to

IEA ETP2017

[B2DS]

Mid. cost reduction w.o. consideration

B2DS_2 Low cost particularly

in Middle-East & N.

AfricaB2DS_3 Share mobilities acceleration

(Fully autonomous cars)

Socioeconomic scenarios SSP2 (“Middle of the Road” scenario); Global population: 9.2 billion in 2050, and global GDP growth:

2.4%/yr between 2000 and 2050.

SSP1 (“Sustainability” scenario); Global population: 8.6 billion in 2050, and global GDP growth:

2.6%/yr between 2000 and 2050.

Page 22: Transformation of energy systems for carbon neutrality and ... · sides (over 400 specific technologies including CCUS are modeled.) Primary energy: coal, oil, natural gas, hydro&geothermal,

-20

-10

0

10

20

30

40

50

60

70

80

2000 2010 2020 2030 2040 2050 2060 2070 2080 2090 2100

CO

2e

mis

sio

ns

[GtC

O2/y

r]

Historical

Baseline

2DS (GHG -40% in 2050)

B2DS (GHG -70% in 2050)

22

Baseline Global Emissions and the Assumed 2 C Scenarios

※ The emissions of 2DS and B2DS by 2030

were constrained by the submitted emission

targets of NDCs of individual nations.

GHG emissions

CO2 emissions

Note) Baseline emissions are not the assumed scenarios but

are the resulting emissions by using the DNE21+ model.

The figure shows the emissions of SSP2.

-20

0

20

40

60

80

100

2000 2020 2040 2060 2080 2100

GH

G e

mis

sio

ns

[GtC

O2eq/y

r]

Historical

Baseline

2DS (GHG -40% in 2050)

B2DS (GHG -70% in 2050)

Page 23: Transformation of energy systems for carbon neutrality and ... · sides (over 400 specific technologies including CCUS are modeled.) Primary energy: coal, oil, natural gas, hydro&geothermal,

Image of the assumed cases for cost reductions of PV:

middle and low costs

Source) IRENA

23

Middle case(SSP2-base)

Low case(mainly in Middle-East & N. Africa)

10 ¢/kWh(1% of total potential)1213 ¢/ /kWh(20%)1518 ¢/kWh(79%)

In 2050

In 2010

Distributions are estimated by GIS of solar radiation

Global PV potentials: around 1,270,000 TWh/yr

Around 3 ¢/kWh has been already

observed in UAE, for example.

※ DNE21+ model assumes the requirement of additional costs for maintaining grid stability in the case of large share of VRE.

2 ¢/kWh(1% of total potential)34 ¢/ /kWh(20%)69 ¢/kWh(79%)

Page 24: Transformation of energy systems for carbon neutrality and ... · sides (over 400 specific technologies including CCUS are modeled.) Primary energy: coal, oil, natural gas, hydro&geothermal,

24

Major assumptions of car- and ride-sharing and

the estimated impacts

[Major assumptions] (mainly following Fulton et al. (2017))

Fully autonomous car can be realized in 2030

Additional costs for fully autonomous cars:

+10,000$ in 2030, +5,000$ in 2050, +2,800$ in 2100

Operation ratio of cars: depending on travel service demands of cars per area

Considering driving free benefits, time costs for waiting shared cars, and safety

benefits for fully autonomous cars

Life times of cars: 13-20 years for conventional cars, 6-20 years for share cars

Number of riding per car:

1.1-1.5 people in 2050 and 1.1-1.3 people in 2100 for conventional cars

1.75 people in 2050 and 2 people in 2100 for shared cars

[Estimated impacts] Number of shared car owned in 2050: 60% compared to that of conventional car owned

Number of shared car sales in 2050: 70% compared to that of conventional car sales

[Impacts on iron and steel productions] Ton of steel for shared cars: 78% compared to that for conventional cars

Total iron and steal productions in the SSP1 and car- & ride-sharing scenario: 98% of

those in the SSP1 without consideration in car- & ride-sharing

[Impacts on productions of ethylene and propylene] Share of productions of ethylene and propylene in productions of plastics:85%

The share for cars in the productions of ethylene and propylene: 8%

Total productions of ethylene and propylene: 99% (accordingly reductions in naphtha

and ethane)

Page 25: Transformation of energy systems for carbon neutrality and ... · sides (over 400 specific technologies including CCUS are modeled.) Primary energy: coal, oil, natural gas, hydro&geothermal,

25

Emission Reduction Costs in 2050

Large differences can be estimated for the emission reduction costs for the

achievement of 2 C target with >50% probability (2DS) and >66% probability (B2DS).

Costs reductions of renewable energy mainly in Middle-East etc. (Cases 2 and 3) will

contribute to the reductions of global mitigation costs.

Accelerating share-mobility induced by fully autonomous cars (Case 3) will decrease

the MAC considerably and may achieve negative costs even for 2 C target.

SSP2 SSP1 SSP2 SSP1

2℃、>50% 2℃、>66%

2DS_1 2DS_2 2DS_3 2DS_3 B2DS_1 B2DS_2 B2DS_3 B2DS_3

Carbon

price

(MAC)

[$/tCO2]

166 158 129 120 530 483 299 252

CO2

emission

reduction

costs

[billion

US$/yr]

1761 1313 Negative Negative 5601 4757 Negative Negative

Page 26: Transformation of energy systems for carbon neutrality and ... · sides (over 400 specific technologies including CCUS are modeled.) Primary energy: coal, oil, natural gas, hydro&geothermal,

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2D

S_1

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P1-B

2D

S_3

2015 2030 2050 2100

CO

2em

issio

n[G

tCO

2/y

r]

Industrial process

LULUCF

Other energy conversion

Power

Residential & Commercial

International marine bunker

Other transportation

Road transportation

Other industry

Chemical

Petrochemical

Pulp & Paper

Cement

Iron & Steel

26

Global CO2 Emissions by Sector

Deeper the emission reductions are, larger the emission reductions in power sector (renewables, nuclear,

CCS etc.), and by afforestation, HV and PHV in transport sector etc. can be estimated.

Much deeper emission reductions will require larger deployments of BECCS, CCS for steel productions, EV

and FCV in road sector etc.

Net nearly zero or negative CO2 emissions will require FCV trucks and methanation etc.

The achievement of fully autonomous cars and the induced sharing mobility will alleviate efforts for large

remission reductions in power sector around 2050.

2050 21002030REF 2DS B2DS REF 2DS B2DSREF 2DS

Page 27: Transformation of energy systems for carbon neutrality and ... · sides (over 400 specific technologies including CCUS are modeled.) Primary energy: coal, oil, natural gas, hydro&geothermal,

0

20000

40000

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100000

120000

SS

P2-R

EF

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P1-2

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SS

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2D

S_1

SS

P2-B

2D

S_3

SS

P1-B

2D

S_3

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EF

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EF

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_1

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P1-2

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2D

S_1

SS

P1-B

2D

S_3

2015 2030 2050 2100

Ele

ctr

icity g

enera

tion

[TW

h/y

r]

Solar Photovoltaics w/o grid

Wind power w/o grid

Hydrogen co-firing

Hydrogen

Solar Thermal

Solar Photovoltaics

Wind power

Nuclear power

Hydro & Geothermal

Biomass co-firing w/ CCS

Biomass w/ CCS

Biomass co-firing w/o CCS

Biomass w/o CCS

Gas w/ CCS

Gas CGS

Gas w/o CCS

Oil w/ CCS

Oil w/o CCS

Coal w/ CCS

Coal w/o CCS

27

Global Electricity Supply

Global electricity consumption will increase greatly for any of the scenarios。 In the 2 C scenarios, the gas uses increase toward 2030, and after 2050 renewables, nuclear power and

CCS increase. In the 2DS scenarios, co-generation will be cost-efficient toward 2030.

In 2DS and B2DS which require net CO2 zero emissions around 2100 and 2070, respectively, BECCS will

be cost-effective. (while the reality in such a large amount of the use of BECCS should be discussed.)

In the sharing mobility cases, the role of BECCS will decrease particularly around 2050.

In the low PV cost scenarios, the PV share including for the productions of hydrogen increases in 2100.

2050 21002030REF 2DS B2DS REF 2DS B2DSREF 2DS

Page 28: Transformation of energy systems for carbon neutrality and ... · sides (over 400 specific technologies including CCUS are modeled.) Primary energy: coal, oil, natural gas, hydro&geothermal,

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SS

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EF

_1

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S_1

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2D

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2D

S_3

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EF

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P1-R

EF

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DS

_1

SS

P1-2

DS

_3

SS

P2-B

2D

S_1

SS

P1-B

2D

S_3

2015 2030 2050 2100

Fin

al

Energ

y C

onsum

ption

[Mto

e/y

r]

Electricity

CGS Elec. (Syn. CH4)

CGS Elec. (Natural gas)

CGS Heat (Syn. CH4)

CGS Heat (Natural gas)

Gaseous: Hydrogen

Gaseous: Syn. CH4

Gaseous: Natural gas

Liquid: Bio fuel

Liquid: Oil

Solid: Biomass

Solid: Coal

28Global final energy consumption: Industry

In all the scenarios, electricity and gas shares increase excepting the gas share around 2100 in B2DS.

For the 2 C scenarios, steel productions through direct hydrogen reduction will be a cost efficient

option in the second half of 21st century (switching from coal to hydrogen in iron & steel sector).

For the 2 C scenarios, switching from coal to gas in cement sector will be cost efficient after around

2050.

Synthetic methane (methanation) will be also cost efficient in industry sector around 2100.

2050 21002030REF 2DS B2DS REF 2DS B2DSREF 2DS

Page 29: Transformation of energy systems for carbon neutrality and ... · sides (over 400 specific technologies including CCUS are modeled.) Primary energy: coal, oil, natural gas, hydro&geothermal,

0

1000

2000

3000

4000

5000

6000

7000S

SP

2-R

EF

_1

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DS

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SS

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EF

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S_1

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2D

S_3

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2D

S_3

SS

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EF

_1

SS

P1-R

EF

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P2-2

DS

_1

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P1-2

DS

_3

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2D

S_1

SS

P1-B

2D

S_3

2015 2030 2050 2100

Fin

al

energ

y c

onsum

ption

[Mto

e/y

r]

Electricity

CGS Elec. (Syn. CH4)

CGS Elec. (Natural gas)

CGS Heat (Syn. CH4)

CGS Heat (Natural gas)

Gaseous: Hydrogen

Gaseous: Syn. CH4

Gaseous: Natural gas

Liquid: Bio fuel

Liquid: Oil

Solid: Biomass

Solid: Coal

29

Global final energy consumption: Building

In all the scenarios, electricity and gas shares increase.

In the 2 C scenarios, the increases particularly in electricity share compared with those in the REF

scenario are observed.

In the B2DS, gas uses decrease considerably after 2050. But in the case 3 which assume sharing mobility,

the decrease in gas use in 2050 will be mitigated due to the decrease in MAC.

In the 2 C scenario with the low PV cost assumption, a part of city gas will be switched to syn. methane

(methanation) around 2100.

2050 21002030

REF 2DS B2DS REF 2DS B2DSREF 2DS

Page 30: Transformation of energy systems for carbon neutrality and ... · sides (over 400 specific technologies including CCUS are modeled.) Primary energy: coal, oil, natural gas, hydro&geothermal,

0

500

1000

1500

2000

2500

3000

3500

SS

P2-R

EF

_1

SS

P2-2

DS

_1

SS

P2-R

EF

_1

SS

P1-R

EF

_3

SS

P2-2

DS

_1

SS

P2-2

DS

_3

SS

P1-2

DS

_3

SS

P2-B

2D

S_1

SS

P2-B

2D

S_3

SS

P1-B

2D

S_3

SS

P2-R

EF

_1

SS

P1-R

EF

_3

SS

P2-2

DS

_1

SS

P1-2

DS

_3

SS

P2-B

2D

S_1

SS

P1-B

2D

S_3

2015 2030 2050 2100

Fin

al

energ

y c

onsum

ption

[Mto

e/y

r]

Electricity

Gaseous: Hydrogen

Gaseous: Natural gas

Liquid: Bio fuel

Liquid: Oil (Others)

Liquid: Oil (HV, PHV)

Solid: Biomass

Solid: Coal

30

Global final energy consumption: Transport

In the 2 C scenarios, EV, FCV and bioenergy increase.

In B2DS, hydrogen uses particularly for FC truck increase after 2050.

The gas use for the international marine bunkers around 2050 is observed. But toward 2100, the gas use will shift to

the hydrogen use.

In B2DS, bioenergy in the transport sector decreases around 2100, because the biomass uses are more cost-effective

in power sector as BECCS.

The final electricity uses (HV, PHV, EV, FCV) in total transport uses in 2050 are about 35% and 55% in 2DS and B2DS,

respectively.

2050 21002030REF 2DS B2DS REF 2DS B2DSREF 2DS

Page 31: Transformation of energy systems for carbon neutrality and ... · sides (over 400 specific technologies including CCUS are modeled.) Primary energy: coal, oil, natural gas, hydro&geothermal,

-40

-30

-20

-10

0

10

20

30

40

SS

P2-2

DS

_1

SS

P2-2

DS

_3

SS

P1-2

DS

_3

SS

P2-B

2D

S_1

SS

P2-B

2D

S_3

SS

P1-B

2D

S_3

SS

P2-2

DS

_1

SS

P1-2

DS

_3

SS

P2-B

2D

S_1

SS

P1-B

2D

S_3

2050 2100

CO

2 c

aptu

re a

nd u

sage o

r sto

rage

[GtC

O2/y

r]

Methanol Synthesis

Concrete CCU

Methane Synthesis

CO2 Storage:Aquifer

CO2 Storage:Depleted gas well

CO2 Storage:ECBM

CO2 Storage:EOR

CO2 Capture:Clinker production

CO2 Capture:Blast furnace

CO2 Capture:Hydrogen production

CO2 Capture:Biomass fired power plant

CO2 Capture:Gas fired power plant

CO2 Capture:Oil fired power plant

CO2 Capture:Coal fired power plant

31

Global balances of CO2 recovery, utilization and storage

in 2050 and 2100

For a deeper emission reduction scenario, B2DS, the amounts of recovered CO2 particularly for BECCS will increase.

For the case 3 which assumes fully self-driving cars and sharing mobility, the MAC decreases, and it induces the

decreases in the amounts of the recovered CO2 from biomass power and hydrogen productions and the CO2 storage.

Capture2050

Storage

/utilization

2100 CO2 capture

-40

-30

-20

-10

0

10

20

30

40

SS

P2-2

DS

_1

SS

P2-2

DS

_3

SS

P1-2

DS

_3

SS

P2-B

2D

S_1

SS

P2-B

2D

S_3

SS

P1-B

2D

S_3

SS

P2-2

DS

_1

SS

P1-2

DS

_3

SS

P2-B

2D

S_1

SS

P1-B

2D

S_3

2050 2100

CO

2 c

aptu

re a

nd u

sage o

r sto

rage

[GtC

O2/y

r]

Methanol Synthesis

Concrete CCU

Methane Synthesis

CO2 Storage:Aquifer

CO2 Storage:Depleted gas well

CO2 Storage:ECBM

CO2 Storage:EOR

CO2 Capture:Clinker production

CO2 Capture:Blast furnace

CO2 Capture:Hydrogen production

CO2 Capture:Biomass fired power plant

CO2 Capture:Gas fired power plant

CO2 Capture:Oil fired power plant

CO2 Capture:Coal fired power plant

-40

-30

-20

-10

0

10

20

30

40

SS

P2-2

DS

_1

SS

P2-2

DS

_3

SS

P1-2

DS

_3

SS

P2-B

2D

S_1

SS

P2-B

2D

S_3

SS

P1-B

2D

S_3

SS

P2-2

DS

_1

SS

P1-2

DS

_3

SS

P2-B

2D

S_1

SS

P1-B

2D

S_3

2050 2100

CO

2 c

aptu

re a

nd u

sage o

r sto

rage

[GtC

O2/y

r]

CO2 Capture:Coal fired power plant

CO2 Capture:Oil fired power plant

CO2 Capture:Gas fired power plant

CO2 Capture:Biomass fired power plant

CO2 Capture:Hydrogen production

CO2 Capture:Blast furnace

CO2 Capture:Clinker production

CO2 Storage:EOR

CO2 Storage:ECBM

CO2 Storage:Depleted gas well

CO2 Storage:Aquifer

Methane Synthesis

Concrete CCU

Methanol Synthesis

CO2 storage/utilization

Page 32: Transformation of energy systems for carbon neutrality and ... · sides (over 400 specific technologies including CCUS are modeled.) Primary energy: coal, oil, natural gas, hydro&geothermal,

-3000

-2000

-1000

0

1000

2000

3000S

SP

2-2

DS

_1

SS

P2-2

DS

_3

SS

P1-2

DS

_3

SS

P2-B

2D

S_1

SS

P2-B

2D

S_3

SS

P1-B

2D

S_3

SS

P2-2

DS

_1

SS

P1-2

DS

_3

SS

P2-B

2D

S_1

SS

P1-B

2D

S_3

2050 2100

Hydro

gen s

upply

and u

tiliz

ation [M

toe/y

r]

Methanol Synthesis

Methane Synthesis

Residential & Commercial

International marine bunker

Truck

Bus

Passenger vehicle

Other industry

Cement

Iron & Steel

Electricity generation

Water electrolysis (Electricity grid)

Water electrolysis (Wind power w/o Grid)

Water electrolysis (Solar PV w/o Grid)

Biomass gasification

Gas reforming

Coal gasification

Olefin production (Net Output)

Oil refinery (Net output)

32Global hydrogen balances in 2050 and 2100

In the standard scenario of PV cost reduction, hydrogen productions from coal gasification with CCS

are cost-efficient, but in the acceleration scenario of PV cost reduction, hydrogen productions from

electrolysis by using the electricity from PV are cost-efficient.

There are several kinds of demands for hydrogen uses.

Supply Supply2050 2100

Demand

Demand

-3000

-2000

-1000

0

1000

2000

3000

SS

P2-2

DS

_1

SS

P2-2

DS

_3

SS

P1-2

DS

_3

SS

P2-B

2D

S_1

SS

P2-B

2D

S_3

SS

P1-B

2D

S_3

SS

P2-2

DS

_1

SS

P1-2

DS

_3

SS

P2-B

2D

S_1

SS

P1-B

2D

S_3

2050 2100

Hydro

gen s

upply

and u

tiliz

ation [M

toe/y

r]Methanol Synthesis

Methane Synthesis

Residential & Commercial

International marine bunker

Truck

Bus

Passenger vehicle

Other industry

Cement

Iron & Steel

Electricity generation

Water electrolysis (Electricity grid)

Water electrolysis (Wind power w/o Grid)

Water electrolysis (Solar PV w/o Grid)

Biomass gasification

Gas reforming

Coal gasification

Olefin production (Net Output)

Oil refinery (Net output)

-3000

-2000

-1000

0

1000

2000

3000

SS

P2-2

DS

_1

SS

P2-2

DS

_3

SS

P1-2

DS

_3

SS

P2-B

2D

S_1

SS

P2-B

2D

S_3

SS

P1-B

2D

S_3

SS

P2-2

DS

_1

SS

P1-2

DS

_3

SS

P2-B

2D

S_1

SS

P1-B

2D

S_3

2050 2100

Hydro

gen s

upply

and u

tiliz

ation [M

toe/y

r]

Oil refinery (Net output)

Olefin production (Net Output)

Coal gasification

Gas reforming

Biomass gasification

Water electrolysis (Solar PV w/o Grid)

Water electrolysis (Wind power w/o Grid)

Water electrolysis (Electricity grid)

Electricity generation

Iron & Steel

Cement

Other industry

Passenger vehicle

Bus

Truck

International marine bunker

Residential & Commercial

Methane Synthesis

Methanol Synthesis

Page 33: Transformation of energy systems for carbon neutrality and ... · sides (over 400 specific technologies including CCUS are modeled.) Primary energy: coal, oil, natural gas, hydro&geothermal,

5. Conclusion

Page 34: Transformation of energy systems for carbon neutrality and ... · sides (over 400 specific technologies including CCUS are modeled.) Primary energy: coal, oil, natural gas, hydro&geothermal,

34

Conclusion

The Paris Agreement states the 2 C/1.5 C targets and the net zero emission target in

the second-half of this century. On the other hand, there are several kinds of

uncertainty such as climate physical science, international policies. Better risk

management will be required recognizing the uncertainties. But in order to stabilize

temperature, global net CO2 emissions are required to be nearly zero regardless of the

temperature level.

Increase in electrification is important with improvement of and achievement of zero

emission intensity of electricity. But there exist several opportunities to decarbonize in

the series of energy conversion processes to final electricity uses including which

energy carriers should be utilized.

The role of the technologies for the carbon neutrality is different depending on the

outlook of each technology. Multiple technologies should be developed while

continuing the evaluation of the economic efficiency of each technology at different

development stages and at levels of uncertainties resolution.

Energy storage technologies such as battery and hydrogen will be important options

for decarbonization of energy and electricity. For the wide deployments of hydrogen

system, the great cost reductions will be required, but for the reductions, appropriate

levels of demand increase will also be required.

Large mitigation costs for achieving the 2 C, net zero emissions etc. have been

estimated even assuming the strong international cooperation, and therefore wide and

disruptive innovations will be necessary for lowering the cost. Digital technologies and

the induced social changes are progressing. The acceleration particularly of the energy

end-use technologies and the social change will be key for the carbon neutrality world

as well as the innovations of energy supply technologies.

Page 35: Transformation of energy systems for carbon neutrality and ... · sides (over 400 specific technologies including CCUS are modeled.) Primary energy: coal, oil, natural gas, hydro&geothermal,

Appendix

Page 36: Transformation of energy systems for carbon neutrality and ... · sides (over 400 specific technologies including CCUS are modeled.) Primary energy: coal, oil, natural gas, hydro&geothermal,

CO2

emission

Carbon

price

Baseline scenario

Intervention scenario

Carbon price/

Marginal abatement cost

High carbon prices are unlikely to be accepted globally in a real world. Under high carbon

prices, the international cooperation for emission reductions will be really challenging, and the

large difference of carbon prices will induce carbon leakage.

Technology and social innovations which will bring low (implicit or explicit) carbon prices

(including coordination of secondary energy prices) are key to achieve deep emission cuts.

The technologies having cost efficiency under high carbon prices such as BECCS and DACS

will play a role for responses to risks in the case of high climate damages.

Model world: Ordinary technology progress

【P2P4】

CO2

emission

Carbon

price

Baseline

scenario

Intervention scenario

Implicit or explicit carbon price/

Marginal abatement cost

By technology

and social

innovations

Realistic world requirement:Innovations stimulated & implemented

【P1】

36

Image of standard scenarios by models and

scenarios required for deep cuts in a real world

(additional costs)(additional costs)

Page 37: Transformation of energy systems for carbon neutrality and ... · sides (over 400 specific technologies including CCUS are modeled.) Primary energy: coal, oil, natural gas, hydro&geothermal,

37

CO2 marginal abatement cost for the U.S, EU and Japan:

Additional costs by domestic policies

0

100

200

300

400

500

CO

2m

arg

ina

l ab

ate

me

nt co

st ($

/CO

2)

I. US II. EU III. Japan

I-a

III-a

I-a: -26%; the least costI-b: -28%; the least costI-c: -26%; power sector

according to CPPI-d: -28%; power sector

according to CPP

I-b

II-a: the least costII-b: Brexit (-40% for UK)II-c: splitting into ETS and

non-ETS sectors

III-a: the least cost under nuclear of maximum 20%

III-b: the least cost undernuclear of maximum 15%

III-c: following the NDC including the energy mix (nuclear of 20%)

III-d: following the NDC including the energy mixbut nuclear of 15%

I-c

I-d

II-a

III-c

III-d

III-bII-b

II-c

Source: estimated by RITE DNE21+

- It is not easy to achieve the least cost measures because there are several kinds of social and

political constraints in each nation.

- The mitigation costs constrained by other policies can be much higher than those under the

least cost measures.

* CPP: Clean Power Plan

Page 38: Transformation of energy systems for carbon neutrality and ... · sides (over 400 specific technologies including CCUS are modeled.) Primary energy: coal, oil, natural gas, hydro&geothermal,

38Global Primary Energy Supply

0

5000

10000

15000

20000

25000

30000S

SP

2-R

EF

_1

SS

P2-2

DS

_1

SS

P2-R

EF

_1

SS

P1-R

EF

_3

SS

P2-2

DS

_1

SS

P2-2

DS

_3

SS

P1-2

DS

_3

SS

P2-B

2D

S_1

SS

P2-B

2D

S_3

SS

P1-B

2D

S_3

SS

P2-R

EF

_1

SS

P1-R

EF

_3

SS

P2-2

DS

_1

SS

P1-2

DS

_3

SS

P2-B

2D

S_1

SS

P1-B

2D

S_3

2015 2030 2050 2100

Prim

ary

energ

y s

upply

[Mto

e/y

r]

Solar Thermal

Solar Photovoltaics

Wind power

Nuclear power

Hydro & Geothermal

Biomass w/ CCS

Biomass w/o CCS

Gas w/ CCS

Gas w/o CCS

Oil w/ CCS

Oil w/o CCS

Coal w/ CCS

Coal w/o CCS

2050 21002030

REF 2DS B2DS REF 2DS B2DSREF 2DS

Renewable energy, nuclear power, and CCS are expanding toward 2100 in both scenarios with the 2

C targets.

However, even in 2100, a certain amount of fossil fuel use without CCS will remain.

Page 39: Transformation of energy systems for carbon neutrality and ... · sides (over 400 specific technologies including CCUS are modeled.) Primary energy: coal, oil, natural gas, hydro&geothermal,

0

200

400

600

800

1000

1200

1400

1600S

SP

2-R

EF

_1

SS

P2-2

DS

_1

SS

P2-R

EF

_1

SS

P1-R

EF

_3

SS

P2-2

DS

_1

SS

P2-2

DS

_3

SS

P1-2

DS

_3

SS

P2-B

2D

S_1

SS

P2-B

2D

S_3

SS

P1-B

2D

S_3

SS

P2-R

EF

_1

SS

P1-R

EF

_3

SS

P2-2

DS

_1

SS

P1-2

DS

_3

SS

P2-B

2D

S_1

SS

P1-B

2D

S_3

2015 2030 2050 2100

Fin

al

energ

y c

onsum

ption

[Mto

e/y

r]

Electricity

Gaseous: Hydrogen

Gaseous: Natural gas

Liquid: Bio fuel

Liquid: Oil (Others)

Liquid: Oil (HV, PHV)

Solid: Biomass

Solid: Coal

39Global final energy consumption: automobiles

210020502030

REF 2DS B2DS REF 2DS B2DSREF 2DS

Even under the 2 C scenarios, in many of the scenarios, oil fuels (HV, PHV) still play a main role by

around 2050.

In the sharing mobility scenarios (case 3), the EV share will increase compared with that in the

standard scenarios (cases 1 and 2).

In 2100, EV plays a main role in all of the 2 C scenarios.

Page 40: Transformation of energy systems for carbon neutrality and ... · sides (over 400 specific technologies including CCUS are modeled.) Primary energy: coal, oil, natural gas, hydro&geothermal,

40Global final energy consumption: Truck

0

200

400

600

800

1000

1200S

SP

2-R

EF

_1

SS

P2-2

DS

_1

SS

P2-R

EF

_1

SS

P1-R

EF

_3

SS

P2-2

DS

_1

SS

P2-2

DS

_3

SS

P1-2

DS

_3

SS

P2-B

2D

S_1

SS

P2-B

2D

S_3

SS

P1-B

2D

S_3

SS

P2-R

EF

_1

SS

P1-R

EF

_3

SS

P2-2

DS

_1

SS

P1-2

DS

_3

SS

P2-B

2D

S_1

SS

P1-B

2D

S_3

2015 2030 2050 2100

Fin

al

energ

yconsum

ption

[Mto

e/y

r]

Electricity

Gaseous: Hydrogen

Gaseous: Natural gas

Liquid: Bio fuel

Liquid: Oil (Others)

Liquid: Oil (HV, PHV)

Solid: Biomass

Solid: Coal

210020502030

REF 2DS B2DS REF 2DS B2DSREF 2DS

Even in the 2 C scenarios, oil fuels will be dominant by around 2050. Biofuels also play a

considerable role.

For the 2 C scenarios, hydrogen (FCV) plays a main role in 2100.

Page 41: Transformation of energy systems for carbon neutrality and ... · sides (over 400 specific technologies including CCUS are modeled.) Primary energy: coal, oil, natural gas, hydro&geothermal,

41Global final energy consumption: Int’l marine bunkers

0

50

100

150

200

250

300

350

SS

P2-R

EF

_1

SS

P2-2

DS

_1

SS

P2-R

EF

_1

SS

P1-R

EF

_3

SS

P2-2

DS

_1

SS

P2-2

DS

_3

SS

P1-2

DS

_3

SS

P2-B

2D

S_1

SS

P2-B

2D

S_3

SS

P1-B

2D

S_3

SS

P2-R

EF

_1

SS

P1-R

EF

_3

SS

P2-2

DS

_1

SS

P1-2

DS

_3

SS

P2-B

2D

S_1

SS

P1-B

2D

S_3

2015 2030 2050 2100

Fin

al

energ

y c

onsum

ption [M

toe/y

r]

Hydrogen

Biodiesel (high eff.)

Biodiesel (low eff.)

LNG (high eff.)

LNG (low eff.)

Diesel (high eff.)

Diesel (low eff.)

Low sulfur heavy oil (high eff.)

Low sulfur heavy oil (low eff.)

High sulfur heavy oil+Sscrubber+EGR/SCR (high eff.)

High sulfur heavy oil+Sscrubber+EGR/SCR (low eff.)

High sulfur heavy oil (high eff.)

High sulfur heavy oil (low eff.)

2050 21002030

REF 2DS B2DS 2DS B2DSREF 2DS REF

国際海事機関(IMO)によるSOx、NOx規制をすべてのシナリオで想定。 2DSでは2050年頃以降はLNG利用の経済効率性が大。B2DSでは2050年以降、水素利用が支配的。