Natural Gas Pipeline Development in Southeast Asia

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         APERC
            ASIA PACIFIC ENERGY RESEARCH CENTRE




REPORT TO THE 20 TH MEETING OF THE APEC ENERGY WORKING GROUP

                        CUSCO, PERU



                OCTOBER 18 - 19, 2000




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                                               F OR E WOR D


     APERC began its fifth year of operation in July 2000. After completing its six 1999/2000 studies in March
2000, APERC in 2000/01 began phase two for four projects from the previous year plus added two new studies
-- Clean Development Mechanism (CDM) and New and Renewable Energy (NRE). In addition, APERC
started work on the Annual Energy Overview project requested by the EWG 19 in April 2000 in Bandar Sri
Begawan. This exercise will become an annual APERC project. Some preparatory work will be undertaken in
2000 for the update of the APEC Energy Demand and Supply Outlook which is planned for 2001. Researchers
are currently preparing these new studies.

    The Mid-Year July 2000 Workshop in Tokyo was a success. To ensure that the end product meets the needs
of APEC member economies, EGEDA members, energy planners and experts were asked to give input and
provide guidance for our 2000/01 studies.

    Meanwhile, reports from APERC’s 1999/2000 studies have been distributed widely to APEC member
economies. These reports have also been posted on the website in PDF format to enable greater access to
findings and results. APERC continues to receive useful input and comments on these publications. Updates
on certain studies have been requested to keep readers abreast of recent energy sector developments in APEC
economies.

    This report outlines APERC’s activities over the last year but focuses on the events that have taken place
since EWG 19 in Brunei Darussalam. The activities to be discussed include research progress, other activities
and various administrative matters.

    I look forward to working with the APEC EWG and its affiliated Expert Groups.


    Keiichi Yokobori
    President

    September 2000




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                                                                                 CONTENTS



Foreword ......................................................................................................................................................................ii

Executive Summary ....................................................................................................................................................4

Research Themes for 2000/01 .................................................................................................................................5

Other Major Activities of APERC .......................................................................................................... 9

Personnel and Administrative Matters ................................................................................................................. 18



APPENDIX 1.                   TERMS OF REFERENCE OF APERC 2000/01 RESEARCH THEMES

     APEC Energy Pricing Practices: Natural Gas End-Use Prices
     Energy Efficiency Indicators for APEC Economies
     Energy Supply Infrastructure Development in the APEC Region
     CDM: A Case Study and Other Issues
     New and Renewable Energy in the APEC Region: Current Status and Future Potential
     APEC Energy Overview

APPENDIX 2.                 APERC’S MID-YEAR WORKSHOP, 13TH – 14TH JULY, 2000

APPENDIX 3.                 APEC 14 NON-BINDING ENERGY POLICY PRINCIPLES

APPENDIX 4.                 APERC ADVISORY BOARD




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                                     EXECUTIVE SUMMARY


    Following the completion of its six projects in 1999/2000 in March 2000, in Financial Year 2000/01,
APERC proceeded with phase two for four projects from the previous year, two new projects and one
project assigned by the APEC EWG 19 in April 2000 in Bandar Sri Begawan.
    The four projects to be continued in 2000/01 are: energy pricing practices, energy efficiency indicators,
power interconnection and the gas infrastructure development – with the latter two themes merged into one
study called energy supply infrastructure development. The new studies are clean development mechanism
(CDM) and new and renewable energy (NRE). The project requested by the EWG 19 in April 2000 is the
APEC Energy Overview. In addition, initial preparations for revising the APEC Energy Supply and Demand
Outlook have begun. Full scale work on the Outlook will start in 2001.

    Hence there are six plus one APERC research themes for 2000/01:

    o   APEC Energy Pricing Practices: Natural Gas End-Use Prices
    o   Energy Efficiency Indicators for the APEC Economies
    o   Energy Supply Infrastructure Development in the APEC Region
    o   CDM: A Case Study and Other Issues
    o   New and Renewable Energy in the APEC Region: Current Status and Future Potential
    o   APEC Energy Overview
    o   Revised APEC Energy Supply and Demand Outlook (initial preparation).


    Meanwhile, the six projects in 1999/2000 resulted in seven hard-copy reports released in April and May
2000. The reports have been widely distributed within the energy sectors of APEC economies. These reports
have also been posted on APERC’s website (http://www.ieej.or.jp/aperc/) to enable other interested parties
both inside and outside of the APEC region to access the results and findings of the studies. APERC
continues to receive positive feedback on these reports. These comments provide useful insight on both
current and previous themes, particularly if this work is to be revisited in the future.

     Other APERC activities related to its research work include: organising conferences and workshops and
publishing the resulting proceedings; actively participating in other conferences, workshops and meetings;
and publishing a bi-annual bulletin to update EGEDA Members and other interested parties on APERC’s
activities.

    On the 13th and 14th of July 2000 APERC organised its Mid-Year 2000 Workshop to hear the views and
opinions of EGEDA Members and energy experts regarding APERC’s current (2000/01) research projects.

   APERC currently has a staff of 24. Of the 18 researchers, 2 are from Japan and 16 are from other APEC
member economies. Working in teams, each researcher is assigned to two to four projects.

   Despite tight budgetary conditions in recent years, funding by the Japanese government for APERC has
remained relatively stable.



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    More detailed information about APERC’s research and other activities is provided in the next two
chapters. Research progress-to-date is discussed in greater detail in the Appendix.

                               RESEARCH THEMES FOR 2000/01


   This section outlines the scope and objectives of the seven projects on which APERC is currently
working. The preparatory work has begun for the revised APEC Energy Demand and Supply Outlook. The
main work on this project will begin in year 2001.

    These projects have progressed to varying degrees. Appendix 1 provides a more detailed Terms of
Reference of each of the projects including some research progress and outcomes to date.




          A P E C E N E RG Y P R I C I N G P R A C T I C E S : N A T U R A L G A S E N D - U S E P R I C E S


OBJECTIVES

   o   To provide an overview of end-use pricing practices for natural gas in the APEC region;
   o   To investigate cross-subsidisation issues in the natural gas market; and
   o   To discuss policy implications for natural gas pricing practices.


SCOPE OF RESEARCH

   o   To provide an overview of end-use pricing practices for natural gas;
   o   To provide an overview of the literature on multi-product utility pricing, such as peak-load pricing,
       subsidy-free pricing, cost-axiomatic pricing, and performance-based ratemaking;
   o   To investigate and improve the methodology for cross-subsidy testing in natural gas pricing;
   o   To develop a case study on the practice of cross-subsidisation in the natural gas market;
   o   To discuss implications for natural gas pricing policy; and
   o   To collect and accumulate data and information on natural gas pricing practices.


                 E N E RG Y E F F I C I E N C Y I N D I C A TO R S F O R A P E C E C O N OM I E S


OBJECTIVES

   o   To establish a common methodology for constructing a basic set of energy efficiency indicators for
       APEC economies.
   o   To construct energy efficiency indicators for the whole economy, major energy consuming sectors
       and for selected industrial and transportation        sub-sectors of APEC member economies.




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   o    To identify areas with potential for energy efficiency improvements in the sub-sectors studied.
   o    To identify barriers to energy efficiency improvements and energy efficiency policies.
   o    To identify the environmental implications of the energy efficiency indicators.
   o    To develop a network of energy efficiency experts and agencies in APEC member economies.


SCOPE OF RESEARCH

   o    The geographical scope is the 21 APEC member economies, as data permits.
   o    The time span is from 1980 to 1998, as data permits.
   o    Energy efficiency indicators will be calculated for the whole economy, for major energy consuming
        sectors i.e. industrial, residential, services and transport, and if data permits, a detailed analysis will be
        carried out for the sub-sectors in industry and transport. Descriptive as well as explanatory
        indicators will be derived.
   o    Energy efficiency policies.
   o    CO2 intensities and emissions related to energy consumption will be calculated.


       E N E RG Y S U P P LY I N F R A S T R U C T U R E D E V E L O P M E N T I N T H E A P E C R E G I O N


OBJECTIVES

   o    To investigate the merits, competition and complementarity between power grid and natural gas
        pipeline interconnection;
   o    To identify critical factors in choosing either power grid or gas infrastructure development;
   o    To assist energy planners in policy decisions between power grid and natural gas pipeline
        interconnection in bilateral or regional energy-trade.


SCOPE OF RESEARCH

   o    Two APEC sub-regions, Northeast Asia and Southeast Asia have been chosen for this study
        because, as was discussed in two previous studies by APERC, a number of interconnection proposals
        are currently under development in these regions.
   o    Northeast Asia covers China, Chinese Taipei, Hong Kong, Japan, Korea and Russia while Southeast
        Asia covers Brunei Darussalam, Indonesia, Malaysia, Philippines, Singapore, Thailand and Viet Nam.
   o    The study will focus on the competition and complementarity between power interconnection and
        gas pipeline interconnection.
   o    Where information and data are available, cost-benefit analysis will be conducted in a real or a
        hypothetical situation where the interconnection points are known.
   o    Existing and future cross-border interconnections will be highlighted.




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   o   Case-studies of/between power grid and natural gas pipeline projects in Northeast Asia and
       Southeast Asia will be included.



                           C D M : A C A S E S T U DY A N D OT H E R I S S U E S


OBJECTIVES

   o   To carry out an economic-environmental feasibility studies on some potential CDM energy projects,
       taking into account CO2 emission reduction potential.
   o   To identify a range of practical problems and barriers as well as benefits in carrying out these
       projects.
   o   To develop pragmatic recommendations to assist implementation of the CDM flexibility mechanism
SCOPE OF RESEARCH

   o   To evaluate CDM – identification of important aspects and relationship with other mechanisms
              A literature survey on key issues under the current Climate Change negotiation
   o   To provide economic and environmental assessment of one or two potential CDM projects
              Assessment of national as well as sectoral energy efficiency level and the cost associated with
               potential greenhouse gas reduction
              Environmental cost and benefit analysis including not only greenhouse gases, but also
               implications for other pollutants
              Sensitivity analysis of rate of return with respect to different carbon prices and alternative
               baselines
   o   To analyse institutional issues such as national energy and economic policies, energy industry
       structure, energy pricing practices, and taxation
   o   To draw policy implications


                 N E W A N D R E N E WA B L E E N E RG Y I N T H E A P E C R E G I O N :
                       C U R R E N T S TA T U S A N D F U T U R E P OT E N T I A L



OBJECTIVES

   o   To assess the current status of NRE in member economies and to establish a current inventory of
       NRE sources, installations and technologies;
   o   To study possible growth patterns for NRE, to assess its future potential and to contribute NRE
       research to the revised APERC Demand and Supply Outlook (in 2001);
   o   To study the potential for NRE policies in member economies to enhance energy supply security and
       to reduce emissions; institutional and               regulatory frameworks as well as innovative
       financing mechanisms to support these                policies; specific biomass technologies in


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       member economies; the economics and commercialisation of NRE systems;
   o   To explore possible areas of co-operation in NRE among member economies.


SCOPE OF RESEARCH

   o   The study will cover the current status of NRE policies, development potential as well as initiatives
       and technologies which could improve the outlook for NRE as an energy option in all 21 APEC
       member economies;
   o   The definition of NRE for the purposes of this study is the following: biomass (e.g. wood & wood
       waste, other agricultural wastes, municipal solid wastes, biogas, animal manure, industrial wastes);
       solar (photovoltaic, solar thermal); wind; geothermal; hydro (mini hydro – 1 MW to 10 MW, and
       micro hydro – below 1 MW); and others (e.g. fuel cells, hydrogen, tidal energy, biocrops).
   o   Large hydro and geothermal are considered to be sources of renewable energy (RE); however, they
       are available in large generation capacities and are highly commercially viable so they are not
       considered to be “new”. Nevertheless, an inventory of these resources will be assembled.
   o   Issues such as NRE technology development, technology transfer, innovative financing mechanisms
       and regional energy cooperation will also be discussed.


                                       A P E C E N E RG Y OV E RV I E W


PROJECTIVE OBJECTIVES

   o   To compile up-to-date data and information on energy use in the APEC region.
   o   To assemble an overview of recent energy developments in each member economy.


SCOPE OF THE PROJECT

   o   A summary of the latest energy demand and supply data from official sources for each member
       economy.
   o   A compilation of key energy policies and notable energy developments in each member economy.


 R E V I S E D A P E C E N E RG Y S U P P LY A N D D E M A N D OU T L OOK ( I N I T I A L P R E PA R A T I O N )



OBJECTIVES

   o   To establish a new database for the demand and supply forecast.
   o   To revise the model and re-estimate the behavioural equations for the forecast.
   o   To develop scenarios based on recent developments in the APEC energy sector. Factors to be




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       considered include economic growth, policy changes, technology development, and socio-economic
       changes.
   o   To update the previous energy supply and demand outlook.
   o To draw policy implications.


SCOPE OF RESEARCH

   o   Review the previous methodology: re-examine each sectoral models.
   o   Revise the model using a new base year and a new time horizon for the forecast
   o   Scenario and sensitivity analyses with respect to some key variables
   o   Consolidate the outlook with major findings from other projects
   o   Draw policy implications for energy security, environment, and infrastructure development




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                          OTHER MAJOR ACTIVITIES OF APERC


                        C O M P L E T I O N OF 1 9 9 9 / 2 0 0 0 R E S E A RC H T H E M E S


    APERC achieved a major milestone in March 2000 when it published reports based on its six research
themes for 1999/2000. These projects were the second set of research activities completed by APERC.
APERC’s first research project was the APEC Energy Demand and Supply Outlook 1998, released in March
1998. To address the financial crisis which hit many APEC economies in mid-1997 and sharply reduced
economic growth and energy consumption, a revised APEC Demand and Supply Outlook was completed in
September 1998.

    The six research themes of 1999/2000 were:

    o   Energy Pricing Practices: Implications for Energy Efficiency, the Environment and Supply
        Infrastructure;
    o   Energy Efficiency Indicators: A Study of Energy Efficiency Indicators for Industry in APEC
        Economies;
    o   Natural Gas Infrastructure Development in the Asia-Pacific Region (Southeast Asia and Northeast
        Asia);
    o   Power Interconnections in the APEC region;
    o   Electricity Sector Deregulation in APEC Economies;
    o   Emergency Oil Stocks and Energy Security in the APEC Region.


    Seven reports were produced from these studies, with the natural gas infrastructure study split into two
separate reports, one focusing on Northeast Asia and the other on Southeast Asia. The reports were printed
on high-quality paper and pages containing charts and diagrams were printed in colour to make them easier to
read.

    To give interested parties better access to results and findings, the seven reports were posted on
APERC’s website in PDF form. Publication requests by energy planners, experts and organisations beyond
the APEC framework can now be fulfilled.

    APERC continues to receive positive feedback, comments and suggestions from various parties on the
results and findings in the reports. The Energy Regulators’ Forum, in its back-to-back meeting with the
EWG 19 in April 2000 in Brunei Darussalam, expressed interest in developing closer ties with APERC,
particularly in collaborating with APERC on studies dealing with regulatory issues. Attendees of the Energy
Business Network at its 4th Meeting in Phuket, Thailand on 17 – 19 August 2000, also expressed their
appreciation for APERC’s studies. At the meeting, many of the participants requested copies of the reports.

   Member economies have also encouraged APERC to revisit its recently completed Electricity
Deregulation Study as electricity restructuring is an ongoing process in most APEC economies.




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                      M I D - Y E A R WO R K S H OP, 1 3 T H - 1 4 T H J U LY 2 0 0 0 , TOK YO


     The key objective of APERC’s Mid-Year Workshop was to bring together energy officials (EGEDA or
their representatives) and other experts to discuss and provide feedback on APERC’s research themes for
2000/01. Thirty-four invited participants attended the workshop including speakers and sessions chairmen.

    Since these projects were in their initial stages, the workshop was seen as a good opportunity to identify
areas of interest to member economies and to procure additional direction for research work.

     The two-day workshop, which was held at the Hotel New Otani in Tokyo, was divided into four plenary
sessions. Research themes were presented in the related plenary session:

    Plenary Session 1: Sustainable Energy Projects

    o   A Case Study of a Clean Development Mechanism (CDM)
    o   Energy Supply Infrastructure in the APEC Region

    Plenary Session 2: Sustainable Energy Use

    o   Energy Efficiency Indicators for the APEC Economies
    o   New and Renewable Energy in the APEC Region: Current Status and Future Potential

    Plenary Session 3: Energy Planning & Policy Issues

    o   APEC Energy Demand and Supply Outlook (an update)
    o   APEC Energy Pricing Practices: Natural Gas End-Use Prices
    o   Energy Overview in the APEC Region

    Plenary Session 4: Chairman Summary.

    The workshop programme is provided in Appendix 2A.

     Volume 1 of the Workshop Proceedings includes summaries of the presentations, floor discussions,
overall sessions, the workshop programme and participants’ list. Volume 2 compiles all papers and
presentation materials provided by the speakers including APERC’s researchers. Workshop Proceedings are
expected to be a valuable resource to each project team. The proceedings are available to the EWG and other
interested parties in the EWG structure upon request.




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  A P E RC P L A N N I N G S E M I N A R TO T H E E WG 1 9 , 4 A P R I L , 2 0 0 0 , BA N DA R S R I B E G AW A N


    At the EWG 18 Meeting in Wellington in November 1999 closer cooperation among APERC, the APEC
Energy Working Group and various sub-groups of the EWG was recommended. The APERC planning
seminar was organised to respond to these concerns. Members of the EWG, Expert Group Chairs, and other
persons associated with the EWG attended the seminar. See Appendix 2B for the seminar programme.

    Mr Yokobori, the President of APERC, first reported on the general activities of APERC since its
establishment – mentioning in particular the APERC Energy Demand and Supply Outlook, and the six
research themes carried out in 1999. He also discussed the four topics which were to be carried over from the
1999 research themes. The Electricity Interconnection and Natural Gas Infrastructure projects were merged
into one study (Energy Infrastructure Development) due to the complementarity of the two subjects.

    Presentations were made by: Dr Ki-Joong Kim (Pricing), Mr Ivan Jaques (Efficiency Indicators), Dr
Yonghun Jung (Natural Gas Pipeline-Northeast Asia, CDM), Dr Hassan Ibrahim (Natural Gas
Pipeline-Southeast Asia, New and Renewable Energy), Mr Zhong-an Wang (Interconnection), Dr David
Cope (Electricity Sector Deregulation), and Mr Keiichi Yokobori (Emergency Oil Stocks). Mr Abdul Shawal
Yaman and Ms Naoko Doi assisted the presenters.

   Discussion at the seminar, particularly with regards to APERC’s most recent research themes, was
documented for future reference.


                               R E L E VA N C E T O A P E C E W G A C T I V I T I E S


    APERC’s studies, conferences and workshops complement the activities of the APEC EWG. Research
themes for APERC’s work are often derived from statements made by APEC energy ministers during
meetings of APEC Energy Ministers and from the APEC 14 Non-Binding Energy Principles (agreed upon by
APEC Energy Ministers).

    APERC continues to assist the EWG in meeting its objectives. At EWG19 in Brunei Darussalam,
APERC was asked to compile on an annual basis an APEC Energy Overview to keep member economies
up-to-date on recent developments in the energy sector.

     Over the previous 12-month period (October 1999 – September 2000), APERC researchers have
participated in meetings, seminars and conferences held under the auspices of the APEC EWG. These
activities include:

    o   15th Meeting of the APEC Expert Group on Energy Efficiency and Conservation (4 -- 5 November
        1999, Canberra);
    o   APEC EWG 18 Meeting (17 -- 19 November 1999, New Zealand);
    o   16th Meeting of the APEC Experts Group on New and Renewable Energy Technologies (28 -- 29
        February, 2000, New Zealand)
    o   Joint 7th Meeting of the Steering Group on Energy Standards and 16th Meeting of the APEC Expert




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          Group on Energy Efficiency and Conservation (1 -- 3 March, 2000, New Zealand);
    o     11th Meeting of the APEC Expert Group on Energy Data and Analysis (6 -- 7 March, 2000, Japan).
    o     APEC Energy Regulators’ Forum 7th Meeting (5 April, 2000)
    o     APEC EWG 19 Meeting (6 – 7 April 2000, Brunei Darussalam)
    o     APEC EWG EBN 4th Meeting (17 – 19 August 2000, Thailand)


     EWG’s interest in APERC’s activities was demonstrated at EWG 18 in New Zealand in November
1999, when APERC was asked to hold its Planning Seminar back-to-back with the EWG 19 in Brunei
Darussalam. The timing of the meetings was beneficial since APERC would have the opportunity to present
the key results of its recently completed research projects to the EWG and its various sub-groups.


                                      I N T E R NA T I ON A L C OO P E R A T I ON


     APERC is working cooperatively with other research organisations within and outside the Asia Pacific
region. These organisations include the Australian Bureau of Agricultural and Resource Economics
(ABARE), the University of Calgary in Canada, Lawrence Berkeley National Laboratory (LBNL), Agence de
l’environnement et de la maîtrise de l’énergie (ADEME) of France and the International Energy Agency
(IEA).

    In 1999, APERC was invited to work with ABARE on an APEC Energy TILF study. APERC is
currently working with New Zealand, Korea, and the Philippines to procure funding from the APEC central
fund for a workshop on energy efficiency indicators. APERC is also working with ADEME on a joint project
on energy efficiency policies and indicators under WEC supervision. ADEME and APERC met the 26-28th
June 2000 in Tokyo to coordinate the work of APERC on its member economies with that of ADEME for
other countries.

    APERC has also worked on a variety of joint research and database development projects with LBNL in
the United States, and ADEME in France as well as international organisations such as the Asian Institute of
Technology (AIT), the World Energy Council (WEC), and the IEA.

    The first meeting of the APERC Advisory Board was held on 12 November 1999, in Tokyo, Japan to
seek research advice from other energy research institutions in the APEC region.1

    To gather ideas for future research projects and to enhance the profile of APERC globally, APERC has
also participated in a wide range of conferences and workshops.




1       Please see Appendix 4 for details of the APERC Advisory Board.



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                                R E S E A RC H C A PA C I T Y BU I L D - U P


    A statistical package, Micro-fit 4.0, was recently acquired by APERC for analytical work. The GTEM
model, a global computable general equilibrium model developed by the Australian Bureau of Agricultural
and Resource Economics (ABARE), is being considered for future projects, such as the CDM study and the
new energy demand and supply outlook.




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                         S U M M A RY O F A P E RC ’ S M A J OR A C T I V I T I E S

                              ( O C TO B E R 1 9 9 9 – S E P T E M B E R 2 0 0 0 )




Table 1

  Month                                                   Activities
               APERC Research Themes
September
                o   Workshop on Energy Pricing Practices (28 – 29/Sep, Tokyo)
1999
                o   APERC 1999 Mid-year Workshop on Current Research Themes (30/Sep –
                    01/Oct, Tokyo)
               Other Activities
                o   WEC Executive Assembly (18 – 25, Cracow, Poland)
                o   UN/ESCAP Ad-hoc Expert Group Meeting on Commericialisation of Renewable
                    Energy Technologies and their Technology Transfer (22 – 24, Bangkok)
                o   Seminar on IEA Oil Stock Strategy (25 – 27, Paris)
               APERC Research Themes
October
                o   Prepared workshop proceedings
1999
                o   Discussed installation of GTEM model with ABARE
               Other Activities
                o   Business Forum on Trans-ASEAN Gas Pipeline and Power Grid (5 – 7, Kuala
                    Lumpur)
                o   Conference of International Gas Union (13, Cheju, Korea)
                o   PECC 99: The Pacific Economy of the 21st Century (21 – 23, Manila)
                o   Energy Working Group Meeting: China Council (CCICED) (22 – 27, Beijing)




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              APERC Research Themes
November
               o   Prepared APERC’s report to APEC EWG 18
1999
               o   APERC Pacific Rim Workshop (9 – 10, Shonan Village, Japan)
               o   APERC Advisory Board Meeting (12, Tokyo)
               o   Published workshop proceedings
               o   APEC EWG Activities
               o   APEC EWG 18 Meeting (17 – 19, New Zealand)
               o   15th Meeting of APEC Expert Group on Energy Efficiency and Conservation
                   (4 – 5, Canberra)
               o   Prepared first issue of APERC Bulletin
              Other Activities
               o   Second International Symposium on Clean Coal Technology (8 – 10, Beijing)
               o   IEA-China Conference on Natural Gas Industry (9 – 10, Beijing)
               o   Asia-Pacific Natural Gas Workshop (22 – 23, East West Center, Honolulu)

              APERC Research Themes
February
               o   APERC Annual Conference 2000 (17 - 18, Tokyo)
2000
               o   Participated in APEC Expert Group Meetings (NREL)
               o   Prepared Annual Conference proceedings
              Other Activities
               o   16th Meeting of the APEC Experts Group on New and Renewable Energy
                   Technologies (28 -- 29, New Zealand)

              APERC Research Themes
March
               o   Incorporated input and comments of February conference in research studies
2000
               o   Completed research projects
               o   11th Meeting of the APEC Expert Group on Energy Data and Analysis (6 -- 7,
                   Tokyo)
               o   Joint 7th Meeting of the Steering Group on Energy Standards and 16th Meeting of
                   the APEC Expert Group on Energy Efficiency and Conservation (1 -- 3, New
                   Zealand)
               o   Refined and proof-read 1999/2000 research reports
               o   Printed reports
              Other Activities
               o   IEA Non-Member Countries Committee Meeting (15 -- 16, Paris)




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            APERC Research Themes
April
             o   APERC Planning Seminar (4 April, Brunei Darussalam)
2000
             o   EWG Energy Regulators’ Forum 7th Meeting (5 April, Bandar Sri Begawan)
             o   APEC EWG 19 (6 – 7 April, Brunei Darussalam)
            Other Activities
             o   UNFCCC Workshop on Best Practices on Policies and Measures (11 – 13,
                 Denmark)
             o   APEC Energy Expert Training Seminar – Roundtable with APERC (28, Ginza
                 Tokyu Hotel)
            APERC Research Themes
May
             o   Started work on new research themes (2000/01)
2000
             o   Posted APERC reports on website
             o   Distributed reports by mail
             o   APEC Energy Ministers’ Meeting (10 – 12, USA)
            Other Activities
             o   CCICED Energy Working Group Meeting (12 – 17, China)
             o   WEC/IEA Symposium on Renewable Energy Development (22 – 25, Guilin,
                 China)
             o   IEA/ASCOPE Asia Oil and Energy Security Seminar (26 – 30, Kuala Lumpur)
             o   Fifth Annual Asia Oil Conference and Gas Conference, (29 –30, Kuala Lumpur)


            Other Activities
June
             o   ADEME-APERC-ENERDATA meeting on energy efficiency indicators and
2000             policies (26 – 28, Tokyo)
            APERC Research Themes
July
             o   Prepared of 2nd issue of APERC Bulletin
2000
             o   Prepared progress report and presentation materials for the Mid-Year Workshop
             o   APERC Mid-Year Workshop (13 -- 14)
             o   Project Lectures (Revisiting of Mid-Year Workshop presentations)
             o   Prepared of workshop proceedings
            APERC Research Themes
August
             o   Research projects and internal lectures on progress
2000
            Other Activities
             o   APEC EBN4 Meeting (19, Phuket)




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                  APERC Research Themes
September
                   o   Research projects and internal lectures on progress
2000
                   o   Refinement of research objectives and issues
                  Other Activities
                   o   Business & Investment Forum for RE and EE in Asia and the Pacific Region 2000
                       (RE&EE2000) (4 – 7, Kuala Lumpur)
                   o   International Conference on Energy Integration in Northeast Asia (21 -- 22,
                       Irkutsk)




                                       A P E RC P U B L I C A T I O N S



                                                REPORTS

APEC Energy Demand and Supply Outlook, APEC #98-RE-01.2, ISBN 4-93148201-5, April 1998.
Supplement to APEC Energy Demand and Supply Outlook, Part I Energy Profile by Economy, Part II
   Model Documentation, APEC # 98-RE-01.2 (Supplement), ISBN 4-93148202-3, June 1998.
APEC Energy Demand and Supply Outlook.' updated, APEC # 98-RE-01.2, ISBN 4-931482-03-1, September
   1998.
Energy Pricing Practices: Implications for Energy Efficiency, the Environment and Supply Infrastructure,
   March 2000.
Energy Efficiency Indicators: A Study of Energy Efficiency Indicators for Industry in APEC Economies,
   March 2000.
Natural Gas Pipeline Development in Southeast Asia, March 2000.
Natural Gas Pipeline Development in Northeast Asia, March 2000.
Power Interconnections in the APEC Region, March 2000.
Electricity Sector Deregulation in APEC Economies, March 2000.
Emergency Oil Stocks and Energy Security in the APEC Region, March, 2000.
                                             PROCEEDINGS

Proceedings of the APERC Conference on Energy Demand and Supply Outlook in the Asia Pacific
   Region, APERC # 98-PROC98-01-98.05.06, May 1998.
Proceedings of the Workshop on Costs and Benefits of Large Scale Development of Natural Gas
   Resources, APERC # 98-PROC98-03-98.08.26, August 1998.
Proceedings of the Workshop on Feasibility Study of Regional Power Interconnection Network in APEC
   Region, APERC # 98-PROC98-01-98.07.17, August 1998.
Proceedings of the APERC Workshop on the Implications of Recent Economic Changes for Energy
   Demand and Supply in the APEC Region, APERC # 98-PROC98-01-98.10.21-22, November 1998.
Proceedings of the APERC Workshop on Energy Pricing Practices in APEC Economies, APERC #
   98-PROC98-01-98.07.15, November i998.
Proceedings of the Workshop on Energy Efficiency Indicators for Industry, APERC #
   98-PROC98-01-98.06.17-17, November 1998.



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Proceedings of the Workshop on Deregulation and Privatisation of the Electricity Sector in APEC
   Economies, APERC # 98-PROC98-01-98.07.16, November 1998.
Proceedings of the Workshop on Emergency Oil Stocks and Energy Security in the Asia Pacific Region,
   APERC # 98-PROC98-01-98.07.17, November 1998.
Proceedings of the Workshop on Energy Pricing Practices: Impacts on Economy and Environment,
   November 1998.
Proceedings of the APERC 1999 Mid-Year Workshop on Current Research Themes, November 1998.
Proceedings of the APERC Mid-Year Workshop on Current Research Themes, APERC #
   98-PROC99-01-99.09.30, September 1999.
Proceedings of the Workshop on Energy Pricing Practices: Impacts on Economy and Environment,
   September 1999.
Proceedings of the APERC 1999 Mid-Year Workshop on Current Research Themes, November 1999.
Proceedings of the APERC Mid-Year 2000 Conference, (available on demand).
                                                     PAPERS

Yokobori, K., Ryu, J-C., and Bawks, B., 1998, ‘Asia Pacific Energy Outlook for 2010’, Paper presented at
   the 21st Annual International Conference of the International Association for Energy Economics,
   Quebec, Canada, May 1998, published in the Congress Proceedings, Volume 2, Experimenting with Freer
   Markets: Lessons from the Last 20 Years and Prospects for the Future, May 1998
Yokobori, K., Bawks, B., and Ryu, J-C, 1998, ‘Asia Pacific Energy Prospects for 2010’, Paper presented at
   the 17th Congress of the World Energy Council, Houston Texas, published in the Congress Proceedings,
   Division 1, Efficient Development and Application of Conventional Resources, September 1998
Ogawa, J. 1999, ‘Economic Development and Transport Energy Demand Outlook in the APEC region’,
   Paper presented at the Energy System, Economic and Environment Conference of the Japan Society
   of Energy and Resources, published in the Conference Proceedings, January 1999.
Yokobori, K., 1999, ‘Outlook of Energy Supply and Demand in the Asia Pacific Region’, Paper presented
   at the Symposium on Pacific Energy Co-operation (SPEC) ’99, February 1999, published in the
   Symposium Proceedings, Changing Economic Environment and Energy Co-operation in Asia, February 1999
Yokobori, K., Ryu, J-C., Triboesono, A. and Stevenson A., 1999, ‘Impacts of Asian Financial Crisis on the
   Long-Term Energy Demand and Supply in the APEC Region’, Paper presented at the 22nd IAEE
   Annual International Conference, June 1999, published in the Conference Proceedings, New Equilibria in the
   Energy markets: The Role of New Regions and Areas, Volume 2, June 1999
Paik, I., Yokobori, K., Leiby, P., and Jones, D., 1999, ‘Strategic Oil Stocks in the APEC Region’, Paper
   presented at the 22nd IAEE Annual International Conference, June 1999, published in the Conference
   Proceedings, New Equilibria in the Energy markets: The Role of New Regions and Areas, Volume 1, June 1999
Bawks, B., and Ogawa, J., 1999, ‘Natural Gas Infrastructure Development in East Asia’, Paper presented
   at the 22nd IAEE Annual International Conference, June 1999, published in the Conference Proceedings,
   New Equilibria in the Energy markets: The Role of New Regions and Areas, Volume 11, June 1999.
Ogawa, J., Bawks, B., Matsuo, N., and Ito, K., 1999, ‘The Characteristics of Transport Energy Demand in
   the APEC region—the Relationship between Transport Energy Demand and Economic Development
   Patterns’, Paper presented at the 22nd IAEE Annual International Conference, June 1999, published in
   the Conference Proceedings, New Equilibria in the Energy markets: The Role of New Regions and Areas, Volume 1,
   June 1999
Ibrahim, H. 1999, “Promoting Renewable Energy Cooperation in the APEC Region”, Paper presented at
   the World Renewable Energy Congress ’99, Kuala Lumpur, Malaysia, June 1999
Yokobori, K., 1999, “For What Disruption Should We Prepare? APEC Perspective”, Paper presented



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   at the Seminar on IEA Stock Strategy, International Energy Agency, Paris, France, September 1999.
Ibrahim, H., 1999, “Planning and Implementation of Energy Networks: A Recommended Approach –
   APERC’s Perspective”, Paper presented at the ASCOPE Forum on Trans-ASEAN Gas Pipeline and
   Power Grids, Kuala Lumpur, Malaysia, October 1999
Yokobori, K., 1999, “Asian Financial Crisis and Its Implications on the Regional Energy Prospects”,
   Paper presented at the Council meeting of the International Gas Union, Cheju, Korea, October 1999.
Yokobori, K., 1999. “APEC Energy Supply and Demand Outlook”, Paper presented at the APEC Oil
   Supply and Demand Security Seminar, Tokyo Japan, November 1999.

Yokobori, K., 1999. “Oil Demand and Supply Perspective and its Security Implications in the Asia Pacific
  Region”, IEA 5th Energy Experts Meeting, Paris, December 1999.

Yokobori, K., 2000. “APEC Energy Policy Issues: APERC Research Findings”, Seminar Session on Outlook
  on APEC Economy, Energy and Environment in conjunction with the 4th meeting of APEC Energy
  Ministers, San Diego, May 2000.

Yokobori, K., 2000. “Energy Security in the APEC Region”, IEA/ASCOPE Asian Oil and Energy Security
  Seminar, Kuala Lumpur, May 2000.

Yokobori, K., 2000. “Asian Regional Perspective on OPEC and Non-OPEC Production, Impact on Market
  and Prices”, 5th Annual Asia Oil and Gas Conference, Kuala Lumpur, May 2000.

Yokobori, K., Takagi, M., and Wu, R-H., 2000. “Joint Emergency Stockholding Scheme for the APEC Oil
  Importers”, 23rd Annual IAEE International Conference, Sydney, 7-10 June 2000.

Yokobori, K., Jung, Y., Ibrahim, H., and Jaques, I., 2000. “Renewable Energy and Energy Efficiency for
  Sustainable Development: The Need for A New Global Priority, Business and Investment Forum for
  Renewable Energy and Energy Efficiency in Asia and The Pacific Region (RE&EE2000)”, Kuala
  Lumpur, September 2000.

Yokobori, K., 2000. “An Evaluation of Energy and Environmental Issues in the Asia Pacific Region”, Kyobo
  International Symposium, Seoul, October 2000.




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                      PERSONNEL AND ADMINISTRATIVE MATTERS


                                        A P E RC R E S E A RC H E R S


   APERC researchers are normally seconded from energy research agencies, both government and
non-government, in member economies. Researchers are seconded for a minimum term of one year, which
may be extended subject to negotiations with the seconding organisations.

Table 2
       Name              Affiliation           Economy         Commence        Management/
                                                                               Project Co-leadership/
                                                                 From          Projects Involvement
 Keiichi Yokobori   Inst. of Energy         Japan             July 1996        President
                    Economics

 Yonghun Jung       Korea Energy            Korea              Mar 1999        Vice President
                    Economics Institute                                        CDM, Outlook
 Shiro Konishi      Nippon Mitsubishi       Japan             Apr 1999         General Manager
                    Oil Co.                                                    (Research)
                                                                               Overview, Infrastructure,
                                                                               Indicator
 Hassan Ibrahim     MARA Univ. of           Malaysia          Mar 1999         Senior Team Leader
                    Technology                                                 NRE, Infrastructure

 Carolyn Ramsum     National Energy         Canada            July 2000        Outlook, Pricing, Overview,
                    Board                                                      Indicator
 Zhong-an Wang      State Development       China             Oct 1998         Infrastructure,
                    Planning Board                                             Interconnection (EPDC),
                                                                               Overview
 Peng Hui           State Development       China             Jan 2000         Outlook, Pricing, CDM,
                    Planning Board                                             Indicator, Overview
 Iman Santoso       Ministry of Mines &     Indonesia         Apr 1999         NRE, Pricing, Infrastructure
                    Energy
 Satya Zulfanitra   Min. of Mines &         Indonesia         Jan 2000         Outlook, Pricing, Indicator,
                    Energy                                                     CDM
 Ivan Jaques        Univ. of Chile          Chile             June 1999        Indicator, NRE, CDM,
                                                                               Infrastructure
 Naoko Doi          Inst. of Energy         Japan             July 1999        Outlook, CDM,
                    Economics                                                  Infrastructure, Overview
 Ki-Joong Kim       Korea Energy            Korea             Feb 2000         Pricing, Infrastructure
                    Economics Institute
 David Cope         Min. of Commerce        New Zealand       Sep 1999         CDM, NRE
 Martin Bonou       Department of           Papua New         Sep 2000         Infrastructure, Indicator
                    Petroleum & Energy      Guinea




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 Edito S. Barcelona        Dept. of Energy           Philippines          Jan 2000           Outlook, NRE, Infrastructure,
                                                                                             Indicator
 Oleg Sinyugin             Moscow State Univ.        Russia               June 1999          Indicator, NRE, Infrastructure
 Shiun-Der Yang            Taiwan Power Co.          Chinese Taipei       Nov 1999           Overview, NRE, CDM,
                                                                                             Infrastructure
 Punnchalee                Thai Oil                  Thailand             June 1999          NRE, Pricing, CDM
 Laothumthut
 Tran Thanh Lien           Institute of Energy       Vietnam              May 1999           Interconnection (EPDC),
                                                                                             Infrastructure, Overview


     Since the previous report to EWG 19 in April 2000, three researchers have left APERC and returned to
their home economies while two new researchers have arrived. Three other new researchers are expected to
join APERC later this year.

    To promote more efficient use of resources and to take into account the varying backgrounds of visiting
researchers, especially those at Team Leader level, the following categories were introduced as of August
1999.

Table 3: Researcher Levels and Allowances

                                   Level                                                            Allowance
                                                                                                  (Yen per day)

Vice President                                                                                         30 000
Team Leader                        Management A                                                        25 000
                                   Management B                                                        22 500
                                   Principal Investigator A                                            20 000
                                   Principal Investigator B                                            17 500
Researcher                                                                                             15 000
Notes: Unless clearly demonstrated qualifications are shown, future Team Leaders will be appointed for a probation period of up to
one year. A researcher with better qualifications may receive a higher allowance.



                                                     A P E RC B U D G E T


   APERC’s budget is provided by the government of Japan, and is used to facilitate energy research work.
Despite tight budgetary conditions, the allocation that APERC receives from the Japanese government has
remained relatively stable over the past few years.

     The table below is a summary of annual financial statements since APERC was created in July 1996.




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Table 4: APERC Revenues and Expenses

Fiscal Year                                 1996       1997        1998       1999          2000
(Unit: thousand yen)                   (9 months)   (actual)    (actual)   (actual)   (approved)

Revenues                                 373,497    626,947    681,464     729,125      735,708
  Japanese Government
Expenses
   Collaborative Research Programmes     226,615    443,304    493,854     549,787      551,267
   Know-how Transfer Programmes           54,246     65,233     65,285      58,080       66,867
   Energy Data Network Service            92,636    118,410    122,334     121,258      117,574
Total                                    373,497    626,947    681,464     729,125      735,708




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                                                 APPENDIX  1

     T ERMS OF R EFERENCE OF APERC’ S 2000/01 R ES EARCH T HEMES


           A P E C E N E RG Y P R I C I N G P R A C T I C E S : N A T U R A L G A S E N D - U S E P R I C E S


BACKGROUND

     The project on the energy pricing practices will focus on large-volume consumers of natural gas as
opposed to small residential and commercial consumers. The former consumer group has important
implications for market reforms as well as the enlargement of the market base. Specifically, they have more
bargaining power than small consumers when negotiating with suppliers, their consumption volumes are
larger, and their load factor is higher in general, to name a few. These factors tend to lower gas supply costs
not only for larger consumers but also, in the long run, for smaller consumers as well.

     There exists a large body of literature on the theory of utility pricing, virtually all of which is concerned
with efficient and equitable pricing practices for the utility services. In particular, while there have been many
discussions about the so-called cross-subsidies that may exist among diverse energy services, consumers and
consumer groups, few, at best, empirical or quantitative analyses may be found to date. The reason might be
that such analyses require sets of comprehensive and detailed micro-data. Even under circumstances where
detailed accounting data are available, there is the problem of linking the accounting information to the
economic concepts of efficiency and equity. This fact may explain why some economies have adopted the
strategy of introducing competition and unbundling of services without objective and accurate calculations of
the existence and magnitude of cross-subsidies.

     Although cross-subsidisation is not in itself either a necessary or a sufficient condition for welfare
maximisation, its existence may induce an inefficient entry of new suppliers in the market. Or, put differently,
the absence of cross-subsidisation will ensure that production and sale of services makes all consumers as well
off as they would otherwise be. Therefore, it is important to review the natural gas pricing practices in APEC
member economies in the context of market reforms and subsidy-free prices. However, the possibility of
maximised welfare in the presence of cross-subsidies should not be precluded even when their existence and
magnitude cannot be verified.

OBJECTIVES

    o   To provide an overview of end-use pricing practices for natural gas in the APEC region;
    o   To investigate cross-subsidisation issues in the natural gas market; and
    o   To discuss policy implications for natural gas pricing practices.


SCOPE OF RESEARCH

    o   To provide an overview of end-use pricing practices for natural gas;
    o   To provide an overview of the literature on multi-product utility pricing, such as peak-load pricing,
        subsidy-free pricing, cost-axiomatic pricing,         and performance-based ratemaking;



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   o   To investigate and improve the methodology for cross-subsidy testing in natural gas pricing;
   o   To develop a case study on the practice of cross-subsidisation in the natural gas market;
   o   To discuss implications for natural gas pricing policy; and
   o   To collect and accumulate data and information on natural gas pricing practices.
METHODOLOGY

   o   Survey the existing literature and economy-specific information on natural gas pricing practices from
       official sources.
   o   Collect accounting data and other micro-data that can allow tests for the cross-subsidisation issue
       such as incremental cost test and stand-alone cost test. Based on the collected data, perform a couple
       of case studies for specific services, consumer groups, or sectors in an economy (or economies).
   o   To the extent that sufficient reliable micro-data are unavailable, more weight will be given to
       qualitative analysis.
   o   Joint-work with experts will be promoted where it is most conducive to the output of the study.
       Expertise will be solicited mainly on the basis of analytical tools at the early stage of the project. And,
       country experts, as required, will also be invited at the later stage of the project.


PROJECT MILESTONES

   o   Literature Survey and Theory Overview                                                   July 2000
   o   Development of Quantitative Analytical Tool                                             August 2000
   o   Examination of Data Requirement and Availability                                        September 2000
   o   Data Collection and Analysis                                                            December 2000
   o   Writing and Presentation of Draft Report and More Analysis                              February 2001
   o   Revision and Reinforcement of Draft Report                                              March 2001


PROJECT PROGRESS TO DATE

   o   By and large, literature survey on theory has been completed but additional papers may be added as
       the study goes on.
   o   A report outline and the role of each author have been defined. Basically, five authors will cover the
       pricing practices in five sub-regions and the rest will work on general issues and specific case studies.
       However, each author’s assignment is not exclusive. Where themes overlap, authors will be asked to
       collaborate.
   o   Basic questions to be addressed during the course of the project have been defined and, among
       others, special emphasis will be placed on the impact of cross-subsidisation on the so-called best
       practices.
   o   An internal lecture series on regulatory economics and cost allocation methodology for utility pricing
       is under way in order to enhance the understanding of the subject and to maintain consistency of the
       report across authors.




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o   Information gathering for case studies is going on through research organisations, government
    bodies, and utilities.




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           E N E RG Y E F F I C I E N C Y I N D I C A TO R S F O R A P E C E C O N OM I E S , P H A S E I I


BACKGROUND

     This study forms part of a long-term project that aims to calculate energy efficiency indicators for all
relevant sectors of the APEC Region. During the first phase, three energy-intensive industrial sectors were
studied, namely iron and steel, cement and pulp and paper. This second phase focuses on other sectors and
continues the work to establish a common methodology to calculate energy efficiency indicators in the
region. Expansion of the network of energy efficiency experts established during Phase I will also be
pursued.

     In parallel, APERC will collaborate with ADEME (France) in a study of energy efficiency indicators for
all WEC member countries. These two studies are considered to be complementary.

OBJECTIVES

    o   To establish a common methodology for constructing a basic set of energy efficiency indicators for
        APEC economies.
    o   To construct energy efficiency indicators for the whole economy, major energy consuming sectors
        and for selected industrial and transportation sub-sectors of APEC member economies.
    o   To identify areas with potential for energy efficiency improvements in the sub-sectors studied.
    o   To identify barriers to energy efficiency improvements and energy efficiency policies.
    o   To identify the environmental implications of the energy efficiency indicators.
    o   To develop a network of energy efficiency experts and agencies in APEC member economies.


SCOPE OF RESEARCH

    o   The geographical scope is the 21 APEC member economies, as data permits.
    o   The time span is from 1980 to 1998, as data permits.
    o   Energy efficiency indicators will be calculated for the whole economy, for major energy consuming
        sectors i.e. industrial, residential, services and transport, and if data permits, a detailed analysis will be
        carried out for the sub-sectors in industry and transport. Descriptive as well as explanatory
        indicators will be derived.
    o   Energy efficiency policies.
    o   CO2 intensities and emissions related to energy consumption will be calculated.


METHODOLOGY

    o   The methodologies to construct and analyse energy efficiency indicators that are best suited for
        APEC economies, will be selected in close consultation with the network of energy efficiency experts
        and EGEDA representatives.
    o   Data will be collected from existing sources,                including IEA, INEDIS, WB, IMF, ADB,



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        UN, OECD, APEC database, ENERDATA, national statistics agencies and others.
    o   A top-down approach will be followed in the calculation of energy efficiency indicators, starting
        from the whole economy (energy intensity of GDP), then to major energy consuming sectors
        (industry, residential, services, and transport). Based on the availability of data, a detailed analysis will
        be conducted for the industrial and transportation sub-sectors.
    o   Indicators will be adjusted to reflect the influence of the various structural and climactic factors and
        to facilitate inter-economy comparisons. The particular averaged parametric Divisia decomposition
        method will be implemented to identify structural and energy efficiency changes which help to
        explain the trends in energy intensity. CO2 emissions related to energy consumption will be
        calculated using IEA emission factors.
    o   Energy efficiency policies implementation will be treated in quantitative terms.
    o   The network of energy efficiency experts will be further developed through numerous activities,
        including workshops, contacts with energy efficiency agencies in each member economy, and
        especially through the joint project that APERC and ADEME will carry on for WEC.


PROJECT MILESTONES

    o   Literature survey:                                                        1 April – 2 June 2000
    o   Data search, initial database construction:                               14 April – 28 July 2000
    o   Definition of common methodology:                                         May – July 2000
    o   Energy efficiency policies questionnaire:                                 July – September 2000
    o   Data analysis, construction of energy efficiency indicators               July – September 2000
    o   (EEI) on the macroeconomic level:
    o   Data analysis, construction of energy efficiency indicators               September – October 2000
    o   (EEI) on the sectoral level:
    o   Correction of the combined set of EEI:                                    November 2000
    o   Draft report:                                                             December 2000 – January 2001
    o   Review of report by experts:                                              February 2001
    o   Completion and publication of the report:                                 March 2001

DATA REQUIREMENTS

The following data for APEC economies are required for the study:

    o   Economic activity data on the macroeconomic level, including GDP time series, GDP deflators,
        exchange rates, purchasing power parities, value added in industry and manufacturing, agriculture
        and transport, private consumption by households, population and number of households,
        employment by sectors, value added data for industrial sectors.
    o   Energy consumption data for the whole economy, macroeconomic sectors – agriculture, industry,
        transport, services and residential. Energy      consumption data for industrial sectors –



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        manufacturing, ferrous and non-ferrous metals, non-metallic industries, food industries, machinery,
        chemicals, pulp and paper, electric and electronic industries, other manufacturing. Non-energy use,
        traditional fuels, fossil fuels and electricity consumption data are required also.
    o   Energy consumption data improvement is needed for US, China, Russia.
    o   For the transport sector, detailed data on road transportation activity such as stock of vehicles, traffic
        data, specific fuel consumption in different vehicle categories, is required.
    o   The model data spreadsheet has been elaborated in cooperation with ADEME.
    o   Quantitative data on the energy efficiency policies by APEC economies.
    o   Data is required for the period 1980 – 1998.


                      E N E RG Y S U P P LY I N F R A S T R U C T U R E D E V E L O P M E N T
                                          IN THE APEC REGION


BACKGROUND

     Energy planners are often confronted with an option in planning for a bilateral or regional energy-trade
or resources sharing. In some cases, gas and power interconnection can substitute for one another. Therefore,
the decision whether to export/import electricity or natural gas has each specific merits and require different
infrastructure link(s) - being either a long-range power grid or a trunk gas pipeline.

     Cross-border inter-fuel competition could be an important issue. Quite often, in Asia Pacific region, the
power grid interconnection proposals or projects and natural gas pipeline proposals are somehow parallel or
overlapping, or they may serve to a large extent the same market. Therefore, the issue of inter-fuel
competition between them and possible integration of these energy infrastructures is emerging. In Northeast
Asia and Southeast Asia, a number of proposed power grid and natural gas pipeline interconnection projects
are envisaged to have parallel routes, of which some have been in investment process.

   APERC has completed two energy infrastructure studies in March 2000, namely: Natural Gas Pipeline
Development and the Power Grid Interconnection. These two studies serve as a basis for a further study that
merges the two themes for a combined analysis.


OBJECTIVES

    o   To investigate the merits, competition and complementarity between power grid and natural gas
        pipeline interconnection;
    o   To identify critical factors in choosing either power grid or gas infrastructure development;
    o   To assist energy planners in policy decisions between power grid and natural gas pipeline
        interconnection in bilateral or regional energy-trade.


SCOPE OF RESEARCH

    o   Two APEC sub-regions, Northeast Asia and Southeast Asia have been chosen for this study
        because, as was discussed in two previous     studies by APERC, a number of



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       interconnection proposals are currently under development in these regions.
   o   Northeast Asia covers China, Chinese Taipei, Hong Kong, Japan, Korea and Russia while Southeast
       Asia covers Brunei Darussalam, Indonesia, Malaysia, Philippines, Singapore, Thailand and Viet Nam.
   o   The study will focus on the competition and complementarity between power interconnection and
       gas pipeline interconnection.
   o   Where information and data are available, cost-benefit analysis will be conducted in a real or a
       hypothetical situation where the interconnection points are known.
   o   Existing and future cross-border interconnections will be highlighted.
   o   Case-studies of/between power grid and natural gas pipeline projects in Northeast Asia and
       Southeast Asia will be included.


METHODOLOGY

   o   Project is mainly analytical in nature and is based on current information on development and
       situation as well as issues that often arises among energy planners in planning energy infrastructure
       interconnection;
   o   The project is not an attempt to prove the superiority of one energy infrastructure over the other nor
       does it attempt to suggest possible interconnection routes across borders;
   o   The project will be organized in chapters according to the following draft outline:
          Introduction (background, objective, scope and rationale of the study)
          Issues Related to Power and Pipeline Interconnections (policies, trends on merging of
           multi-utilities, advantages and disadvantages, environmental consideration, critical factors
           affecting the choice of the two interconnections);
          Interconnection Projects in Northeast Asia (power interconnections, natural gas pipelines,
           institutional mechanisms in place, complementarity and competition between the two);
          Interconnection Projects in Southeast Asia (power interconnections, natural gas pipelines,
           institutional mechanisms in place, complementarity and competition between the two);
          Policy Implications (institutional and regulatory mechanisms, pricing and their practices,
           geopolitics, inventory of investments and facilities in place
          Conclusions

   o   The simulation done by EPDC on Power Interconnection in Southeast Asia will be appended and
       used to analyse the interconnection issues in Southeast Asia;
   o   The study also includes energy infrastructure experience in North America, South America and
       Western Europe whose energy infrastructure interconnections are more developed as compared to
       Northeast and Southeast Asia.


PROJECT MILESTONES

   o   Broad literature survey:                                             May – June 2000
   o   Definition of study outline:                                         July 2000




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   o   Specific information and data search:                                  July – September 2000
   o   Information & data analysis, formulation of ideas & issues:            September – October 2000
   o   First draft of individual chapters:                                    October – November 2000
   o   Draft of overall report & further refinement of chapters:              December 2000 – January 2001
   o   Review of report by experts:                                           February 2001
   o   Completion and publication of the report:                              March 2001


DATA REQUIREMENTS

   o   Latest development on cross-border power grid and natural gas pipeline interconnections in
       Northeast and Southeast Asia;
   o   Cross-border energy infrastructure projects being planned or at discussion stage, together with
       geo-political issues that emerge;
   o   Distribution of natural gas, coal and hydro resources and their potential markets for the two
       sub-regions;
   o   Current gas and electricity prices and pricing mechanisms;
   o   Key investment cost figures for power grid, gas pipeline and liquified natural gas (LNG)
       infrastructure;
   o   Energy infrastructure experience of North America, Western Europe and South America.


PROJECT PROGRESS TO DATE

   o   Literature survey has begun – the three pre-requisite reports of APERC’s 1999/2000 studies, Power
       Interconnection in the APEC Region, Natural Gas Pipeline Development in Northeast Asia and
       Southeast Asia have been revisited;
   o   Project scope and report outline had been defined, and each researcher has been assigned a particular
       area/topic;
   o   Some write-ups on competition and complementarity of interconnections and on the merging of
       utility companies have been done;
   o   Specific information and data collection, and analysis is still on-going;
   o   Specific comments received during the Mid-Year 2000 Workshop and in various meetings prior to
       workshop are being analysed and will be incorporated into the study.




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                 E N E RG Y A N D E N V I R O N M E N T P R O J E C T S I N A P E C R E G I ON :
                            C D M : A C A S E S T U DY A N D OT H E R I S S U E S



BACKGROUND

    Many forms of environmental pollution accompany energy production and consumption, including SOx
and NOx emissions, acid rain and CO2 and other greenhouse gas emissions, which may cause climate change.
The need for reduction of environmental stresses arising from energy production and use has been
recognized as a key energy policy objective by the APEC Energy Ministers.

     Further, the 3rd Conference of the Parties to the United Nations Framework Convention on Climate
Change, which was held in Kyoto, adopted the Kyoto Protocol in December 1997. Many APEC member
economies participated in the Conference and endorsed the adoption. This Protocol introduced as one of the
flexibility mechanisms to achieve the emission reduction targets, the clean development mechanism (CDM),
with which both Annex I and non-Annex I could cooperate on environmentally sound projects for mutual
benefit (Article 12). Moreover CDM projects could be launched as early as January 1, 2000.

    There are many pending issues related to implementing CDM projects as well as other flexibility
mechanisms under the Kyoto Protocol. Those issues will be dealt with at subsequent negotiations in
accordance with the so-called “the Buenos Aires Plan of Action” which was adopted at the 4th Conference of
the Parties in Buenos Aires, Argentina. Negotiations on the flexibility mechanism will intensify as the target
deadline, COP6 in 2000, for the resolution of major pending issues approaches.

    As APEC consists of both developed and developing economies, cooperation among these groups could
create ample opportunities for sustainable development on one hand and global carbon emissions reduction
on the other through CDM projects. Given the timeliness of this issue, it is opportune that APERC look at
how environmentally friendly energy strategies could be pursued in the APEC region as a candidate for a next
phase study.

    One of the reasons for the slow pace of negotiations is that international discussions focus on prolonged
conceptual principles rather than on developing practical methods of implementation. As a result,
negotiators are often confused about the costs and benefits of CDM projects. By doing a case study of a
potential CDM project and identifying realistic problems and unforeseen costs and benefits, This study is
meant to give negotiators and private sector investors a more practical understanding of the CDM concept.

OBJECTIVES

    o   To carry out an economic-environmental feasibility studies on some potential CDM energy projects,
        taking into account CO2 emission reduction potential.
    o   To identify a range of practical problems and barriers as well as benefits in carrying out these
        projects.
    o   To develop pragmatic recommendations to assist implementation of the CDM flexibility mechanism




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RATIONALE FOR THE PROJECT

 APEC 14 Non-Binding Energy Principles

           Article 8: “Promote the adoption of policies to facilitate the transfer of efficient and
       environmentally sound energy technologies on a commercial and non-discriminatory basis.”

            Article 14: “Cooperate, to the extent consistent with each economy's development needs, in
       the joint implementation of projects to reduce greenhouse gas emissions consistent with the
       Climate Change Convention.”


 Related APEC Ministers Declaration:

            Paragraph 4 in Ministers Declaration of Okinawa meeting, 1998: “Ministers acknowledged
       that important stimulants to renewed growth and prosperity are open and efficient energy
       markets which are guided by appropriate rules to ensure their smooth and equitable functioning
       and the development of efficient energy infrastructure. Ministers also noted the importance of
       improving living standards and of sustainability, and in this context the importance of mitigating
       negative local, regional and global environmental and social impacts of energy production,
       delivery and use.

            Paragraph 19 in Ministers Declaration of Okinawa meeting, 1998: “Recognizing the
       necessity to minimize the adverse environmental impact of new energy infrastructure
       development, Ministers endorsed the Recommended Work Program on Environmentally Sound
       Energy Infrastructure in APEC Member Economies." They agreed that the work program would
       provide impetus to the application of environmental policy practices that are predictable,
       transparent and consistent. Ministers noted that such practices would facilitate energy
       investment while allowing investors flexibility in meeting environmental objectives, and charged
       the Energy Working Group to develop practical and effective means of implementation.”

            Paragraph 25 in Ministers Declaration of Okinawa meeting, 1998:”Ministers stressed the
       importance of promoting energy research and development, commercial and economic transfer
       of environmentally sound technologies, and continuing cost-reduction in the introduction of these
       new technologies, with the direct participation of the business sector.”




SCOPE OF RESEARCH

   o   To evaluate CDM – identification of important aspects and relationship with other mechanisms
               A literature survey on key issues under the current Climate Change negotiation
   o   To provide economic and environmental assessment of one or two potential CDM projects
               Assessment of national as well as sectoral energy efficiency level and the cost associated with
                potential greenhouse gas reduction
               Environmental cost and benefit analysis including not only greenhouse gases, but also
                implications for other pollutants




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              Sensitivity analysis of rate of return with respect to different carbon prices and alternative
               baselines
  o   To analyse institutional issues such as national energy and economic policies, energy industry
      structure, energy pricing practices, and taxation
  o   To draw policy implications


RESEARCH MILESTONE

  o   Start of the Project:                                                 Jan 1, 2000
  o   End of the Project:                                                   March 31, 2001
  o   Establishment of Analytical Framework:                                March 31, 2000
  o   Establishment of Analytical Model:                                    July 31, 2000
  o   Completion of Analysis:                                               Nov. 30, 2000
  o   Final Refinement and Preparation for Publication:                     Jan/Feb 2001


METHODOLOGY AND DATA REQUIREMENTS

  o   A review of the related projects that has been undertaken under AIJ and other international
      cooperation schemes.
  o   A review of previous literature on CDM, JI and AIJ and proposals made to date regarding such key
      issues as additionality, baseline, share of proceeds and etc.
  o   Development of a project evaluation model with environment module
  o   Cost-benefit analysis using Microsoft Excel
  o   Optional Pro-Forma Analysis by an expert
  o   Possible collaboration with other international and regional research organisations including IEA,
      World Bank, and APEC member economies involved in the World Bank’s NSS (National CDM
      Strategy Study)




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                  N E W A N D R E N E WA B L E E N E RG Y I N T H E A P E C R E G I O N :
             A N A S S E S S M E N T O F C U R R E N T S TA T U S A N D F U T U R E P OT E N T I A L


BACKGROUND

    New and renewable energy are becoming increasingly important as fossil fuel supplies tighten and
pressure mounts to mitigate emissions of local and global environmental pollutants including greenhouse
gases. While fossil fuels are gradually depleting, growth in the use of renewable energy has been prevented, in
particular, by a generally low prices of fossil fuels.

    Renewable energy is an important ingredient to any government in their climate change programme.
Renewables not only increase energy supply security in time of depleting fossil fuels, but also contribute
substantially to reducing pollution and in particular to reducing greenhouse gas emissions. Renewables are set
to make an increasing contribution to the provision of secure, diverse, competitive and sustainable energy
supplies.

    The first phase of this project attempts to make a broad survey of the status of new and renewable energy
resources and technologies in the APEC region, with particular focus on: government policies, social and
environmental influences and commercially viable technologies. Potential renewable energy demand growth
patterns will also be investigated, results of which will be a useful input to the APEC Energy Demand and
Supply Outlook project that will be carried out by APERC in 2001.

    This study will identify specific NRE issues to be further investigated. Pending on the recommendations
and findings of this first phase study, more specific issues will be conducted in the next or subsequent phase.



OBJECTIVES

    o   To assess the current status of NRE in member economies and to establish a current inventory of
        NRE sources, installations and technologies;
    o   To study possible growth patterns for NRE, to assess its future potential and to contribute NRE
        research to the revised APERC Demand and Supply Outlook (in 2001);
    o   To study the potential for NRE policies in member economies to enhance energy supply security and
        to reduce emissions; institutional and regulatory frameworks as well as innovative financing
        mechanisms to support these policies; specific biomass technologies in member economies; the
        economics and commercialisation of NRE systems;
    o   To explore possible areas of co-operation in NRE among member economies.


RATIONALE FOR THE PROJECT

    The project is in support of the following statements made at APEC Energy Ministers Meetings:

    Third Meeting of APEC Energy Ministers, Okinawa, Japan, 9 – 10 October 1998




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             Considering the strong forecast growth in demand and increasing dependence on oil from outside the region,
        Ministers recognised the need to promote diversification of energy supply, including where appropriate natural
        gas, renewables and nuclear energy, to promote market-driven energy infrastructure development.


    First Meeting of APEC Energy Ministers, Sydney, Australia, 28 – 29 August 1996

             Ministers agreed to cooperate extensively in research and development, technology adaptation and uptake,
        and programs related to energy efficiency, cleaner fuels and renewable and alternative sources of energy.
        Significant improvement in regional environmental performance will result from such cooperation.


    The project is also in support of Policy No. 1, 2 and 8 of the APEC 14 Non Binding Energy Policy
Principles, respectively:

            Emphasise the need to ensure energy issues are addressed in a manner which gives full consideration to
        harmonisation of economic development, security and environmental factors;

             Pursue policies for enhancing the efficient production, distribution and consumption of energy; and

             Promote the adoption of policies to facilitate the transfer of efficient and environmentally sound energy
        technologies in a commercial and non-discriminatory basis.




SCOPE OF RESEARCH

     This first phase of the study is broad-based. The main objective is to highlight the current status and
future potentials of NRE in the twenty-one economies of APEC. It is very useful to produce in one
document such information including the importance of NRE in the energy policies of APEC economies,
various programmes and projects to promote renewable energy projects and the institutional structure and
financing mechanisms to facilitate and enforce such activities. One of the core requirements in a successful
implementation and utilisation of NRE is information dissemination, and transfer of technologies which
include sharing of experiences and expertise, and fostering energy co-operation among member-economies.

    o   The study will cover the current status of NRE policies, development potential as well as initiatives
        and technologies which could improve the outlook for NRE as an energy option in all 21 APEC
        member economies;
    o   The definition of NRE for the purposes of this study is the following: biomass (e.g. wood & wood
        waste, other agricultural wastes, municipal solid wastes, biogas, animal manure, industrial wastes);
        solar (photovoltaic, solar thermal); wind; geothermal; hydro (mini hydro – 1 MW to 10 MW, and
        micro hydro – below 1 MW); and others (e.g. fuel cells, hydrogen, tidal energy, biocrops).
    o   Large hydro and geothermal are considered to be sources of renewable energy (RE); however, they
        are available in large generation capacities and are highly commercially viable so they are not
        considered to be “new”. Nevertheless, an inventory of these resources will be assembled.
    o   Issues      such      as     NRE        technology                development,            technology              transfer,



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        innovative financing mechanisms and regional energy cooperation will also be discussed.


Data collection and analysis in this study includes:

    o   Collection and investigation of NRE sources (resources, technologies, policies) in each member
        economy, with a focus on technologies that are currently, or soon will be, commercially viable;
    o   Evaluation of the current status and potential of renewable energy resources in each APEC member
        economy;
    o   Evaluation of the energy policies of regional governments relevant to the development of new and
        renewable energy resources and related social, economic, environmental influences;
    o   Assessment of the costs and benefits of NRE development, and comparative advantages within and
        between economies;
    o   Initial development of energy demand and supply scenarios based on enhanced development of
        NRE resources, for incorporation in the updated APERC Demand and Supply Outlook.
Phase 2 or subsequent study on NRE will be determined pending on the findings and recommendations of
the Phase 1 study.


RESEARCH MILESTONES

    o   Broad literature survey:                                            May – June 2000
    o   Definition of study outline:                                        July 2000
    o   Specific information and data search:                               July – September 2000
    o   Information & data analysis, formulation of ideas & issues:         September – October 2000
    o   First draft of individual chapters:                                 October – November 2000
    o   Draft of overall report & further chapters refinement:              December 2000 – January 2001
    o   Review of report by experts:                                        February 2001
    o   Completion and publication of the report:                           March 2001

METHODOLOGY

    o   This project requires intensive data which include: current availability of NRE from various sources
        (such as biomass, solar, wind energy and hydro), current and planned utilisation of NRE, NRE in the
        energy policies, programmes and projects to promote NRE utilisation, specific or niche technologies
        developed; the institutional and regulatory mechanisms; barriers of implementation;
    o   Studies conducted by the APEC Expert Group on Renewable Energy Technologies (EGRET) and
        other agencies or organisations on APEC economies, and country papers presented in various
        seminars and conferences by energy officials from the APEC economies will be used as main
        references. The study also requires strong collaboration with other international and regional
        organisations actively involved in promoting new and renewable energy;
    o   A questionnaire of data required for the                 study will be developed but rather than



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        sending them to be member economies they will be filled out by APERC researchers to the extent
        possible. They will be distributed to member economies (EGEDA) only for validation and for them
        to supplement the missing data;
    o   The NRE statistics would be useful to make early preparations for the coming APEC Energy
        Demand and Supply Outlook (in 2001) which would include an outlook on the NRE sub-sector.
    o   The experience and expertise of certain economies (like New Zealand) who have among the highest
        NRE utilisation in their share of total primary energy supplies (excluding big hydro and geothermal)
        will be drawn on to assist in the evaluation of the potential for NRE development in other
        economies;
    o   Case studies will be included for economies of interest, focusing on specific resources, technologies,
        and innovative financing mechanisms of driving NRE projects.
DATA REQUIREMENTS

     The following are data that are necessary for the study. (Member economies – i.e. the EGEDA members
- will only be required to contribute the missing data after the data survey format have been compiled by the
researcher from independent but reliable sources):

    o   Historical NRE supply, their heat content, & conversion factors used for biomass (e.g. wood &
        woodwaste, other agricultural wastes, municipal solid wastes, biogas, animal manure, industrial
        wastes); Solar (photovoltaic, solar thermal); Wind; Geothermal; Hydro (large hydro – above 10MW,
        mini hydro – 1 MW to 10 MW, and micro hydro – below 1 MW); and Others (e.g. fuel cells,
        hydrogen, tidal energy, biocrops);
    o   Current installed capacity of NRE electricity generating facilities;
    o   Estimated total resources, percentage of utilisation or development, and future capacities as planned;
    o   NRE in the energy policies of member economies; the significance of NRE in the ensuring energy
        supply security and meeting the Kyoto Protocol target; institutional and regulatory mechanisms in
        place; programmes to promote further utilisation of NRE; innovative project financing schemes;
        technology development and niches in indigenous technology development; and barriers
        encountered;
    o   Regional cooperation in NRE; information dissemination; technology transfer arrangements.


PROJECT PROGRESS TO DATE

    o   Literature survey had started, sorting out the most useful information;
    o   Report outline and role of each researcher have been defined. With each researcher assigned two to
        three economies, there is high inter-dependency among researchers in analysing and writing-up their
        specific topics/chapters;
    o   NRE data survey format had been designed and filled out by researchers – they are/will be sent to
        member economies to validate and to supplement the missing data;
    o   Specific comments received during the Mid-Year 2000 Workshop and in various meetings prior to
        this related to the study are being analysed to be incorporated into the study;
    o   Draft Chapter One of the report has been completed to give team members clearer direction on the




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    scope of research and their role in the work;
o   Specific information and data collection, and analysis is on-going;
o   Internal lectures on various related topics to NRE are held regularly by team members to stimulate
    discussions and formulate ideas.




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                                         A P E C E N E RG Y OV E RV I E W


RATIONALE FOR THE PROJECT

    Energy demand in APEC region is expected to increase rapidly as Asia recovers from the financial crisis
in 1997. Meeting growing energy demand is a very important task. The energy overview, which discusses
trends in energy demand and supply in each member economy, is expected to be a useful resource.

    Regulatory reform in the energy sector in the APEC region is actively promoting information exchange
among APEC member economies. The energy overview will be useful for policy makers in understanding
the evolution of energy policy in each APEC economy.

    The 11th EGEDA held in Tokyo on March 6-7 proposed the APEC Energy Overview project. At the
19thEWG meeting, held in Brunei Darussalam on April 6 -- 7, 2000, the project was approved and APERC
was asked to coordinate the work.



PROJECTIVE OBJECTIVES

       o   To compile up-to-date data and information on energy use in the APEC region.
       o   To assemble an overview of recent energy developments in each member economy.


SCOPE OF THE PROJECT

       o   A summary of the latest energy demand and supply data from official sources for each member
           economy.
       o   A compilation of key energy policies and notable energy developments in each member economy.


PROJECT MILESTONES

       o   Literature survey and establishment of report format                 May – June 2000
       o   Information compilation and editing                                  July – August 2000
       o   Preparation of draft report                                          September 2000
       o   Circulation of draft report to member economies                      September 2000
       o   Circulation at the 20th EWG meeting for comments                     October 2000
       o   Completion of the final report and posting on APERC website          December 2000




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                                   E N E RG Y D E M A N D A N D S U P P LY O U T L O OK


BACKGROUND

       o    Energy demand and supply outlook has been used extensively for setting energy policies in general
            and making investment decisions in energy facilities.
       o    It also serves as a milepost for energy efficiency, environment and infrastructure development
            policies.
       o    Under the fast evolving energy environment including regulatory regime shifts, technology
            development and demographic changes, it is imperative to establish a consistent framework to
            analyse the future course of energy demand with a view to adopting timely and appropriate policies
            and measures.


OBJECTIVES

       o    To establish a new database for the demand and supply forecast.
       o    To revise the model and re-estimate the behavioural equations for the forecast.
       o    To develop scenarios based on recent developments in the APEC energy sector. Factors to be
            considered include economic growth, policy changes, technology development, and socio-economic
            changes.
       o    To update the previous energy supply and demand outlook.
       o To draw policy implications.


RATIONALE FOR THE PROJECT

       o    This project has been endorsed by EWG and recognized and appreciated by Energy Ministers in all
            gatherings from Sydney to Okinawa.
       o    The support of the project is ubiquitous in all EWG decisions and Energy Ministers Declaration.
       o    In particular, at the 3rd Energy Ministerial Meeting in Okinawa, “Ministers agreed that the energy
            outlook prepared by the Asia Pacific Energy Research Centre should be used by the Energy Working
            Group as an important basis for policy discussion and that the Centre should continue its work to
            better understand the energy supply and demand issues confronting the Asia Pacific Region.”2


SCOPE OF RESEARCH

       o    Review the previous methodology: re-examine each sectoral models.
       o    Revise the model using a new base year and a new time horizon for the forecast
       o    Scenario and sensitivity analyses with respect to some key variables

2   #7 of the Ministerial Declaration, adopted in Okinawa, 1998.



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  o   Consolidate the outlook with major findings from other projects
  o   Draw policy implications for energy security, environment, and infrastructure development
RESEARCH MILESTONE

  o   Start of the Project:                                                July 1, 2000
  o   Data collection and model revision:                                  December 2000
  o   Test run and fine-tuning of the model;                               June 30, 2001
  o   First draft:                                                         September, 2001
  o   Second draft:                                                        November 2001
  o   Final draft and end of the Project:                                  March 31, 2002


METHODOLOGY AND REQUIREMENT

  o   Model specification and its level of disaggregation will depend mainly on data availability
  o   Econometric approach will be employed wherever possible with rigorous diagnostic testing. MFIT
      will be used for the most part in testing the validity of model.
  o   Other conventional estimation methods will be adopted where econometric methods are not
      applicable and appropriate data is not available. An example is “intensity times activity” approach.
  o   Still undecided on how to establish macro-indicators, which include the path of GDP growth.




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                                            A P P E N D I X  2A


                    APERC MID-YEAR WORKSHOP, 13 – 14 JULY 2000
                              W O R K S H OP P R OG R A M M E

                                     THURSDAY, 13 JULY 2000

Registration: 08:45 – 09:15                                                       (Room Orizuru Rei)
Opening Session
09:15 – 09:30    Welcome and Introduction                                    Mr Keiichi Yokobori

Plenary Session 1: Sustainable Energy Projects                                     Room Orizuru Rei
Chair: Prof Thierry Lefevre                       Rapporteur: (Dr David Cope, Ms Naoko Doi, APERC)
09:30 – 09:40    Energy and Environment Projects: CDM – A Case Study         Dr Yonghun Jung,
                 and other Issues                                            APERC
09:40 – 10:10    Clean Development Mechanism: Opportunities and              Dr Jayant A. Sathaye,
                 Challenges                                                  LBNL
10:10 – 10:40    National Energy Planning and Technological Choices in       Prof Thierry Lefevre, AIT
                 Developing Asian Economies – CDM Scenario
10:40 – 11:00    Coffee Break
                                          Rapporteur: (Dr Ki-Joong Kim, Mr Zhong-an Wang, APERC)
11:00 – 11:10    Energy Supply Infrastructure Development in the APEC        Dr Hassan Ibrahim,
                 Region                                                      APERC
11:10 – 11:40    Energy Supply Infrastructure in the APEC Region             Dr Yogo Pratomo, MME,
                                                                             Indonesia
11:40 – 12:10    Energy Infrastructure Development in the APEC Region        Dr Ismail Mustapha,
                                                                             PTM
12:10 – 12:40    Floor Discussions

12:40 – 14:00    Lunch

Plenary Session 2: Sustainable Energy Use                                           Room Orizuru Rei

Chair: Dr Ismail Mustapha                      Rapporteur: (Mr Ivan Jaques, Mr Iman Santoso, APERC)
14:00 – 14:10    Energy Efficiency Indicators for APEC Economies             Dr Oleg Sinyugin,
                                                                             APERC
14:10 – 14:40    Indicators of Energy and Carbon Emissions: A                Dr Lee Schipper, IEA
                 Disaggregated Approach to Energy Analysis. Priorities for
                 the New Millennium
14:40 – 15:10    Energy Efficiency Trends in Canada                          Mr Michel Francoeur,
                                                                             National Resources
                                                                             Canada
                                            Rapporteur: (Dr David Cope, Mr Edito Barcelona, APERC)
15:10 – 15:20    New and Renewable Energy in the APEC Region:                Dr Hassan Ibrahim,
                 Current Status and Future Potential                         APERC
15:20 – 15:50    Renewable Energy: Biomass Based Grid-Connected              Mr Ahmad Zairin Ismail,
                 Cogeneration Plants in Malaysia                             PTM




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15:50 – 16:20    Energy Conservation Potential of Energy Cascading      Prof Takao Kashiwagi,
                 Systems for Urban Energy Systems                       Tokyo University of
                                                                        Agriculture &
                                                                        Technology
16:20 – 16:40    Coffee Break
16:40 – 17:10    Floor Discussion

18: 00 – 20:00   Reception Dinner (Room: Orizuru Sho)




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                                       FRIDAY, 14 JULY 2000




Plenary Session 3: Energy Planning and Policy Issues                               Room Orizuru Rei


Chair: Ms Karen Schneider              Rapporteur: (Ms Carolyn Ramsum, Ms Satya Zulfanitra APERC)

09:10 – 09:20    APEC Energy Supply and Demand Outlook Update                Dr Yonghun Jung,
                                                                             APERC
09:20 – 09:50    Discussion on APERC Energy Demand and Supply                Dr Tae Yong Jung, IGES
                 Outlook (Rep. of Korea)
09:50 – 10:20    United States Energy and Emissions Outlook                  Ms Susan Holte,
                                                                             Department of Energy,
                                                                             USA
10:20 – 10:40    Coffee Break

                                        Rapporteur: (Mr Edito Barcelona, Ms Satya Zulfanitra APERC)

10:40 – 10:50    APEC Energy Pricing Practices: Natural Gas End-Use          Dr Ki-Joong Kim,
                 Prices                                                      APERC
10:50 – 11:20    Future Trends in Natural Gas Pricing in Southeast Asia      Dr Romeo B. Pacudan,
                                                                             AIT
11:20 – 11:50    Introducing Competition and Natural Gas Pricing Practice    Mr Hyun Jae Doh, KEEI
                 in Korea: Past Experience and Anticipated Changes
11:50 – 12:00    Energy Overview in the APEC Region                          Dr Shiun-Der Yang,
                                                                             APERC
12: 00 – 12:30   Floor Discussions


12:40 – 14:00    Lunch


Session 4: Chair Summary                                                           Room Orizuru Rei


Chair: Prof Ken’ichi Matsui                Rapporteur: (Ms Carolyn Ramsum, Mr Ivan Jaques APERC)

14:00 – 14:20    Summary by Chair of Session 1                                 Prof Thierry Lefevre
14:20 – 14:40    Summary by Chair of Session 2                                 Dr Ismail Mustapha
14:40 – 15:00    Summary by Chair of Session 3                                 Ms Karen Schneider
15:00 – 16:00    Comments from EGEDA Members
16:00 – 16:15    “Wrap-Up” and Concluding Remarks                              Mr Keiichi Yokobori

16:15 – 16:45    Coffee




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                                         A P P E N D I X  2B


                APERC PLANNING SEMINAR AT EWG , 4 APRIL 2000,
                                    BRUNEI DARUSSALAM

                                     S E M I NA R P R OG R A M M E



                                    Tuesday, 4 April 2000

                                                  Venue: Goldstone Ballroom, Centrepoint Hotel

Meeting Chairman: Mr Tim Mackey, Chair of the EWG
                                                                               Rapporteurs: APERC




09:00 – 09:10                        OPENING REMARKS                                 CHAIRMAN

 09:10 – 9:20   Report on APERC Activities                                          Mr. K. Yokobori

 9:20 – 10:30   Summary Report on Current Research Themes
                 Energy Pricing Practices                                           Dr. Ki-Joong Kim
                 Energy Efficiency Indicators for Industry                           Dr. O. Sinyugin
                 Natural Gas Development in the APEC Region                          Dr. H. Ibrahim
                 Power Interconnection in the APEC Region                            Mr. Z-A Wang
                 Deregulation and Privatisation of the Electricity Sector                Dr. Y. Jung
                 Emergency Oil Stocks in APEC                                       Mr. K. Yokobori

10:30 – 11:00    – Coffee Break –

11:00 – 11:30   New Research Proposals for 2000

                Energy and Environment Projects in the APEC Region: A Case               Dr. Y. Jung
                Study of a CDM project

                Improving Data Quality and Policy Frameworks in New and              Dr. H. Ibrahim
                Renewable Energy




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                APEC Energy Demand and Supply Outlook: Preparatory Work     Dr. Y. Jung
                for Updating in 2001

11:30 – 12:30   Questions and Answers




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                                         APPENDIX  3

              APEC 14 N O N B I N D I N G E N E RG Y P OL I C Y P R I N C I P L E S


o   Emphasise the need to ensure energy issues are addressed in a manner that gives full consideration
    to harmonisation of economic development, security and environmental factors.
o   Pursue policies for enhancing the efficient production, distribution and consumption of energy.
o   Pursue open energy markets for achieving rational energy consumption, energy security and
    environmental objectives, recommending action in the appropriate forum of APEC to remove
    impediments to the achievement of these ends.
o   Recognise that measures to facilitate the rational consumption of energy might involve a mix of
    market based and regulatory policies, with the relative components of the mix being a matter for
    the judgement of individual economies.
o   Consider reducing energy subsidies progressively and promote implementation of pricing practices
    that reflect the economic cost of supplying and using energy across the full energy cycle, having
    regard to environmental costs.
o   The regular exchange of experience on the various policies being used by member economies to
    achieve more rational energy consumption.
o   Ensure that a least cost approach to the provision of energy services is considered.
o   Promote the adoption of policies to facilitate the transfer of efficient and environmentally sound
    energy technologies on a commercial and non-discriminatory basis.
o   Encourage the establishment of arrangements for the development of human resource skills
    relevant to the application and operation of improved technology.
o   Enhance energy information and management programs to assist more rational energy decision
    making.
o   Encourage energy research, development and demonstration to pave the way for cost effective
    application of new, more efficient and environmentally sound energy technologies.
o   Promote capital flows through the progressive removal of impediments to the funding of the
    transfer and adoption of more energy efficient and environmentally sound technologies and
    infrastructure.
o   Promote cost effective measures that improve the efficiency with which energy is used but reduce
    greenhouse gases as part of a suggested regional response to greenhouse gas reductions.
o   Cooperate, to the extent consistent with each economy's development needs, in the joint
    implementation of projects to reduce greenhouse gas emissions consistent with the Climate
    Change Convention.




                                                                                             EWG20/8 Att E
                                                                             Agenda Item 8/Attachment E




                                                 APPENDIX  4

                                        APERC A DV I S O RY B OA R D



                                                 BA C KG RO U N D


     The establishment of the Advisory Board was endorsed by the APEC Energy Working Group (EWG) at
their 16th meeting in Cairns, Australia, in August 1998.

                                          T E R M S OF R E F E R E N C E 3


    The Advisory Board is a group of representatives of major research institutions located in the APEC
region to facilitate APERC to conduct cooperative research studies.

    Its primary role is to give professional advice on the on-going and proposed research of the APERC with
respect to the issues to be covered such as databases, information sources, relevant experts to be involved,
methodologies and approaches.

   APERC will carefully consider the advice provided by its members in proposing its research plan to the
APEC Expert Group on Energy Data and Analysis (EGEDA) and eventually to EWG.

    The views and suggestions expressed by the Advisory Board will remain anonymous. However, the
suggestions emerging from the Advisory Board should be circulated for information to the members of the
EGEDA.

                                  M E M B E R S ( A S O F N OV E M B E R 1 9 9 9 )



    Prof. Ken’ichi Matsui             APEC EGEDA Chair                                                    Japan

    Dr. Brian Fisher                  Executive Director, Australian Bureau of Agricultural and           Australia
                                      Resource Economics
    Dr. J. P. Prince                  President, Canadian Energy Research Institute                       Canada

    Prof. Fengqi Zhou                 Former Director, Energy Research Institute                          China

    Prof. Zongxin Wu                                 4                                                    China
                                      Director, INET , Tsinghua University
    Mr. Yoshihiro Sakamoto            President, Institute of Energy Economics, Japan                     Japan

    Dr. Hyun-Joon Chang               President, Korea Energy Economics Institute                         Korea



3     Terms of Reference for the Advisory Board were adopted at the 10th meeting of the APEC Expert Group on Energy Data
      and Outlook (currently Expert Group on Energy Data and Analysis) held in Brunei Darussalam in March 1999, and was
      endorsed by the APEC EWG at their 17th meeting in Oakland, the United States, in April 1999.
4     Institute of Nuclear Energy Technology.



                                                                                                            EWG20/8 Att E
                                                                        Agenda Item 8/Attachment E




    Prof. Garegin S. Aslanian       Executive Vice President, Russian Centre for Energy Policy   Russia

    Dr. Mark Levine                 Director, Lawrence Berkeley National Laboratories            USA

    Dr. Guillermo R. Balce          Executive Director, ASEAN Centre of Energy                   ASEAN

    Prof. Thierry Lefevre                            5                                           AIT
                                    Director, CEERD , Asian Institute of Technology




5    Center for Energy-Environment Research and Development.




FOR ACTION BY EWG20:                     Members to comment on the draft APEC Annual
                                         Energy Overview prepared by APERC.


                                                                                                  EWG20/8 Att E

				
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