Changing Energy Production Structures and CO2 Emissions in the ASEAN Countries: Decomposition Analysis of Drivers Behind the ChangesAuthors: Vehmas, Jarmo, Luukkanen, Jyrki, Kaivo-oja, Jari, Snäkin, Juha-Pekka & Jusi, Sari Note: This is extended version of conference paper materials.Venue: International Conference on Energy Security and Climate Change: Issues, Strategies, and Options (ESCC 2008) Sofitel Centara Grand, Bangkok, Thailand. 6-8 August 2008

Presentation by: Dr, Research Director Jari Kaivo-ojaFinland Futures Research CentreTurku School of EconomicsRehtorinpellonkatu 320500 TURKUFinlandEmail jari.kaivo-oja@tse.fiTel. +358-50-50207030

5 Effects analyzed by decomposition analysis

• The objective of decomposition analysis in this article is to divide the observed change in carbon dioxide (CO2) emissions from fuel combustion into contributions of different factors of interest identified in the master equation (Equation 1).

POPPOP

GDP

GDP

FEC

FEC

TPES

TPES

COCO

22 (1)

Effects explained..

• As a result of the complete decomposition analysis presented above, five different factors (effects) are identified in a way that their sum equals to the total change of CO2 emissions from fuel combustion.

• The effect of CO2/TPES refers to the contribution of the

change in the CO2 intensity of the entire energy system to CO2 emissions. A positive value indicates that decreased CO2 intensity has decreased CO2 emissions. In practice, change in CO2 intensity is a result of several things.

Effects explained• The effect of TPES/FEC refers to the efficiency of the energy transformation

system, i.e. efficiency in transforming primary energy into different energy carriers such as electricity or heat. This can be influenced by e.g. a switch from fuel use to electricity use, or vice versa, or technological changes in fuel combustion such as a shift from separate heat and electricity production to combined heat and power production (CHP) or vice versa.

• The effect of FEC/GDP refers to the energy intensity of the whole economy. This can be influenced by several factors, such as changes in the industrial structure from energy intensive to less energy intensive industrial branches, a shift from industrial production towards services in terms of GDP shares, or technological development inside energy-consuming fields of the economy. This effect is another one which is widely studied with decomposition analysis. In the most common applications a structural effect related to energy intensity changes have been identified and analysed. The structure in this context deals with the shares of FEC and GDP in different economic sectors and industrial branches, for example.

• The effect of GDP/POP refers to the amount of economic activity per capita which can be influenced foremost by economic growth.

• The effect of POP refers to changes in the amount of population brought about by changing birth and death rates as well as changes n international migration.

CO2 emissions in the ASEAN countries, 1971-2005

0

2

4

6

8

10

12

14

16

1971 1976 1981 1986 1991 1996 2001

CO2 emissions, 1971 = 1

Brunei

Indonesia

Malaysia

Myanmar

Philippines

Singapore

Thailand

Vietnam

China

India

Japan

USA

OECD Europe

Figure 1. CO2 emissions from fuel combustion in the ASEAN countries and in some reference countries 1971-2005, 1971=1. Source: IEA 2007a.

GDP index 1971-2005

0

2

4

6

8

10

12

14

16

18

20

1971 1976 1981 1986 1991 1996 2001

GDP (PPP), 1971 = 1

Brunei

Cambodia

Indonesia

Malaysia

Myanmar

Philippines

Singapore

Thailand

Vietnam

China

India

Japan

USA

OECD Europe

Figure 2. GDP index (using purchasing power parities PPP) in the ASEAN countries and in some reference countries 1971-2005 (1971=1). Source: IEA 2007a.

Development of CO2 emissions from fuel combustion and GDP (PPP)in

the ASEAN vcun

0.0

2.0

4.0

6.0

8.0

10.0

12.0

0.0 5.0 10.0 15.0 20.0 25.0 30.0

CO2/POP

GDP/POP

Cambodia

Indonesia

Malaysia

Myanmar

Philippines

Singapore

Thailand

Vietnam

China

India

Japan

Figure 3. Development of CO2 emissions from fuel combustion and GDP (PPP) in the ASEAN countries and some reference countries 1971-2005, Source: IEA 2007a.

TPES by energy source in Brunei, 1980-2005

Figure 5. Total Primary Energy Supply (TPES) by energy source in Brunei 1980-2005. Source: IEA 2007b.

TPES by energy source in Indonesia, 1980-2005

Figure 7. Total Primary Energy Supply (TPES) by energy source in Indonesia 1980-2005. Source: IEA 2007b.

TPES by energy source in Malaysia, 1980-2005

Figure 9. Total Primary Energy Supply (TPES) by energy source in Malaysia 1980-2005. Source: IEA 2007b.

TPES by energy source in Myanmar, 1980-2005

Figure 11. Total Primary Energy Supply (TPES) by energy source in Myanmar 1980-2005. Source: IEA 2007b.

TPES by energy source in Philippines, 1980-2005

Figure 13. Total Primary Energy Supply (TPES) by energy source in the Philippines 1980-2005. Source: IEA 2007b.

TPES by energy source in Singapore, 1980-2005

Figure 15. Total Primary Energy Supply (TPES) by energy source in Singapore 1980-2005. Source: IEA 2007b.

TPES by energy source in Thailand, 1980-2005

Figure 17. Total Primary Energy Supply (TPES) by energy source in Thailand 1980-2005. Source: IEA 2007b.

Figure 19. Total Primary Energy Supply (TPES) by energy source in Vietnam 1980-2005. Source: IEA 2007b.

TPES by energy source in Vietnam, 1980-2005

Decomposition of CO2 emissions from fuel combustion in Indonesia,

1980-2005Indonesia

-100

0

100

200

300

400

CO2/TPES TPES/FEC FEC/GDP GDP/POP POP DCO2(sum)

% o

f 19

80 C

O 2

1980-19901980-20001980-2005

Figure 6. Decomposition of CO2 emissions from fuel combustion in Indonesia 1980-2005, contributions of five factors in percentage of 1980 CO2 emission level.

Decomposition of CO2 emissions from fuel combustion in Malaysia,

1980-2005Malaysia

-50

50

150

250

350

450

CO2/TPES TPES/FEC FEC/GDP GDP/POP POP DCO2(sum)

% o

f 19

80 C

O 2

1980-19901980-20001980-2005

Figure 8. Decomposition of CO2 emissions from fuel combustion in Malaysia 1980-2005, contributions of five factors in percentage of 1980 CO2 emission level.

Decomposition of CO2 emissions from fuel combustion in Myanmar,

1980-2005Myanmar

-200

-100

0

100

200

CO2/TPES TPES/FEC FEC/GDP GDP/POP POP DCO2(sum)

% o

f 19

80 C

O 2

1980-19901980-20001980-2005

Figure 10. Decomposition of CO2 emissions from fuel combustion in Myanmar 1980-2005, contributions of five factors in percentage of 1980 CO2 emission level.

Decomposition of CO2 emissions from fuel combustion in Philippines,

1980-2005Philippines

-50

0

50

100

150

CO2/TPES TPES/FEC FEC/GDP GDP/POP POP DCO2(sum)

% o

f 19

80 C

O 2

1980-19901980-20001980-2005

Figure 12. Decomposition of CO2 emissions from fuel combustion in Philippines 1980-2005, contributions of five factors in percentage of 1980 CO2 emission level.

Decomposition of CO2 emissions from fuel combustion in Singapore,

1980-2005Singapore

-100

0

100

200

CO2/TPES TPES/FEC FEC/GDP GDP/POP POP DCO2(sum)

% o

f 19

80 C

O 2

1980-19901980-20001980-2005

Figure 14. Decomposition of CO2 emissions from fuel combustion in Singapore 1980-2005, contributions of five factors in percentage of 1980 CO2 emission level.

Decomposition of CO2 emissions from fuel combustion in Thailand,

1980-2005Thailand

-50

50

150

250

350

450

550

CO2/TPES TPES/FEC FEC/GDP GDP/POP POP DCO2(sum)

% o

f 19

80 C

O 2

1980-19901980-20001980-2005

Figure 16. Decomposition of CO2 emissions from fuel combustion in Thailand 1980-2005, contributions of five factors in percentage of 1980 CO2 emission level.

Decomposition of CO2 emissions from fuel combustion in Vietnam,

1980-2005Vietnam

-300

-100

100

300

500

CO2/TPES TPES/FEC FEC/GDP GDP/POP POP DCO2(sum)

% o

f 19

80 C

O 2

1980-19901980-20001980-2005

Figure 18. Decomposition of CO2 emissions from fuel combustion in Vietnam 1980-2005, contributions of five factors in percentage of 1980 CO2 emission level.

Decomposition of CO2 emissions from fuel combustion in China,

1980-2005People's Republic of China

-400

-200

0

200

400

600

CO2/TPES TPES/FEC FEC/GDP GDP/POP POP DCO2(sum)

% o

f 19

80 C

O 2

1980-19901980-20001980-2005

Figure 20. Decomposition of CO2 emissions from fuel combustion in China 1980-2005, contributions of five factors in percentage of 1980 CO2 emission level.

Decomposition of CO2 emissions from fuel combustion in India,

1980-2005India

-250

-150

-50

50

150

250

350

CO2/TPES TPES/FEC FEC/GDP GDP/POP POP DCO2(sum)

% o

f 19

80 C

O 2

1980-19901980-20001980-2005

Figure 21. Decomposition of CO2 emissions from fuel combustion in India 1980-2005, contributions of five factors in percentage of 1980 CO2 emission level.

Decomposition of CO2 emissions from fuel combustion in U.S.A.,

1980-2005United States of America

-80

-60

-40

-20

0

20

40

60

CO2/TPES TPES/FEC FEC/GDP GDP/POP POP DCO2(sum)

% o

f 19

80 C

O 2

1980-19901980-20001980-2005

Figure 22. Decomposition of CO2 emissions from fuel combustion in the United States 1980-2005, contributions of five factors in percentage of 1980 CO2 emission level.

Decomposition of CO2 emissions from fuel combustion in Japan,

1980-2005Japan

-30

-10

10

30

50

70

CO2/TPES TPES/FEC FEC/GDP GDP/POP POP DCO2(sum)

% o

f 19

80 C

O 2

1980-19901980-20001980-2005

Figure 23. Decomposition of CO2 emissions from fuel combustion in Japan 1980-2005, contributions of five factors in percentage of 1980 CO2 emission level.

Decomposition of CO2 emissions from fuel combustion in the World,

1980-2005World

-50

-30

-10

10

30

50

CO2/TPES TPES/FEC FEC/GDP GDP/POP POP DCO2(sum)

% o

f 19

80 C

O 2

1980-19901980-20001980-2005

Figure 25. Decomposition of CO2 emissions from fuel combustion in the World 1980-2005, contributions of five factors in percentage of 1980 CO2 emission level.

Decomposition of CO2 emissions from fuel combustion in OECD

Europe, 1980-2005OECD Europe

-40

-30

-20

-10

0

10

20

30

40

50

CO2/TPES TPES/FEC FEC/GDP GDP/POP POP DCO2(sum)

% o

f 19

80 C

O 2

1980-19901980-20001980-2005

Figure 24. Decomposition of CO2 emissions from fuel combustion in the European OECD countries 1980-2005, contributions of five factors in percentage of 1980 CO2 emission level.

Short summary• In this paper, we have analysed empirically the reasons which have

caused a change in CO2 emissions from fuel combustion in the ASEAN countries using the data from International Energy Agency (IEA). Instead of an ordinary three-factor (activity, intensity and structural effects) decomposition analysis, a new method capable of taking five different factors into account has been used.

• The CO2 emissions per capita are considerably low in many ASEAN countries (except Singapore), but the emissions are increasing fast due to the rapid economic growth and increased reliance on fossil fuels. The emission intensities in the countries have been increasing in the industrialization process, but with shift to more service sector oriented production and higher level of GDP per capita, the intensities can decrease. However, the trend of increasing CO2 emissions is difficult to cut due to the increasing population.

I thank you for attention!

Dr, Research Director Jari Kaivo-ojaFinland Futures Research Centre (FFRC)

Turku School of Economics (TSE) Rehtorinpellonkatu 3

20500 TURKUFinland

Email jari.kaivo-oja@tse.fiTel. +358-50-50207030