- Email: [email protected]
Mitigation of greenhouse gas emissions originating from energy consumption by the residential sector in Ecuador
Articles
Mitigation of greenhouse gas emissions originating from energy consumption by the residential sector in Ecuador Alvaro Cesar Morales Calle Paez 884 y Mercadillo, Ed. Interandino, Quito, Ecuador[1] Ildo Luis Sauer University of São Paulo (USP), Graduate Program on Energy, Av. Professor Luciano Gualberto 1289 SP, São Paulo -- SP, Brazil 05508-900
Ecuador presents a singular pattern of energy consumption, based, mainly, on fossil fuels. Such a situation is, from both environmental and economic points of view, neither desirable nor strategic for the country, a signatory to United Nations Framework Convention on Climate Change (UNFCCC). However, the current transition that the energy sector in Ecuador is undergoing may enable solutions based on demand-side management (DSM). The purpose of this work is to investigate the use of DSM measures that may lead to reduction in fossil fuel demand and thus mitigate greenhouse gas emissions in Ecuador. Technical and economic assessments are carried out through construction of scenarios with the Long-Range Energy Alternatives Planning System (LEAP) model. Results show attractiveness of measures based both on substitution of energy sources and on energy efficiency. 1. Introduction Modern society’s energy requirements have continuously increased because of population growth and the intrinsic demand for goods and services. Energy production and use disturb in many ways the ecological equilibrium of the planet. Fuel combustion represents the most significant source of greenhouse gas emissions, resulting in climate changes. Global warming was recognized in 1992, at the Rio de Janeiro Conference, as a controllable but irreversible process, being the most serious menace to future generations in terms of environmental sustainability and economic development. Seeking solutions to this collective problem, around 150 countries subscribed to the United Nations Framework Convention on Climate Change (UNFCCC), a legal basis for international cooperation and action towards controlling the phenomenon. Ecuador was among these UNFCCC signatory countries. The Third and Fourth Conferences of Parties, held in Kyoto and Buenos Aires, introduced economic and commercial elements to allow and enhance climate change mitigation measures, through ‘‘flexibility mechanisms’’ (including clean development mechanisms -- CDMs). When ratified, these mechanisms will establish a new kind of international trade, capable of generating intense flow of resources directed towards mitigation measures. It is expected that the growth of internal markets for technology development will be stimulated in many countries. On the other hand, there is no consensus yet about the degree of obligation binding developed and developing Energy for Sustainable Development
countries to emission reduction targets (Annex 1 countries) [IPCC, 1995]. Latin America can play a significant role in this landscape, at least as an interesting market for CDM implementation. Nevertheless, the crucial question is another one. It is well known that developing countries contribute only a small fraction of both current and accumulated global emissions. However, economic growth and social improvement depends strongly on increasing availability of energy services. The challenge is how to grow with a smaller or more efficient and sustainable energy consumption pattern. Technological alternatives exist to cope with environmental obligations while maintaining social goals and acquiring strategic advantages in CDM negotiations. In the energy sector it is possible and reasonable to promote energy efficiency as well as utilization of non-fossil fuels. Prevailing typical energy consumption patterns make it difficult for Ecuador to meet the goals of UNFCCC. To succeed, a strong effort to change the country’s energy balance will be required. Fortunately, positive developments on clean energy sources are creating favorable expectations for the development of efficient use of energy in the country. The aim of this work is to assess strategies seeking reduction of greenhouse gas emissions related to the energy consumption of the residential sector. The specific objectives are: • to identify and to analyze options for mitigation of greenhouse gas emissions in the residential sector; l
Volume V No. 3
l
September 2001
47
Articles
Table 1. Available energy resources in Ecuador (PJ) Resource
Crude oil
Reserves %
Natural gas
Coal
Hydropower
Geothermal
Biomass
Total
22,543.36
815.36
680.96
356,339.20
2,441.60
3,113.60
385,934.08
5.9
0.2
0.2
92.3
0.6
0.8
100.0
Table 2. Domestic energy supply, 1995 Sources Primary (1,049,708.80 GJ -- 100 %)
TJ Hydrocarbons
966,201.60
92
Biomass
54,745.60
5.2
Hydropower
26,969.60
2.6
1,792.00
0.2
286,764.80
89.6
1.79
-
33,196.80
10.4
Renewable Secondary (319,961.60 GJ -- 100 %)
Petroleum products Biogas Electricity Thermal
7,168.00
Hydro
25,356.80
Cogeneration
• to calculate future levels of greenhouse gas emissions due to energy consumption, to serve as a base-line case, without intervention, for comparison with the results of a proposed alternative scenario; • to propose base guidelines and develop a future scenario that includes mitigation alternatives; • to evaluate the potential of selected options to mitigate greenhouse gas emissions, their viability and costs; and • to propose mechanisms and strategies that may allow implementation of mitigation measures.
2.1. Energy consumption characteristics Ecuador is endowed with a large number of renewable and non-renewable resources, as shown in Table 1, among them, hydropower and petroleum appearing as the most important. Oil is of highest economic importance for the country’s foreign trade balance. Nevertheless, in terms of energy supply, as shown in Table 2, hydrocarbons are the most utilized source, followed by biomass, while hydropower carries smaller importance. Solar energy, although currently negligible, is perceived as an interesting resource to be exploited in the future, due to favorable solar radiation levels in several regions in the country. Some areas are able to generate up to 4 kWh/m2/day. As secondary energy sources, petroleum products appear, again, as the main resource in Ecuador while electricity is the second most important with a considerable contribution from oil-based thermal generation. Table 2 also shows the country’s strong dependence on hydrocarbons, close to 90 % as primary and secondary energy source. Currently Ecuador is self-sufficient in oil, with exports Energy for Sustainable Development
672.00
exceeding imports. However, the oil sector is entering a critical period because of issues such as: decreasing quality and quantity of reserves; inadequate exploitation and production strategy; uncertainty about oil resources; growth of domestic consumption; need to increase exports to generate hard currency; strong dependence of energy profile on hydrocarbons; imbalance between supply and demand of oil products combined with inadequate refining infrastructure; and a need to adapt to process heavier oils. The electricity sector, the second most important, is also facing a severe crisis. Technical and non-technical electricity losses are high; financial resources are insufficient, impairing investment capacity; management is deficient. Service quality is decreasing constantly and supply restrictions impose a need to resort to rationing. The need for the sector’s restructuring and reorganization is becoming urgent. To this end a new electricity sector law has been enacted, redefining the government’s role and stimulating more responsible and qualified management of utilities. In sum, the traditional scheme of energy production is no longer able to cope with the country’s needs in the medium term. Moreover, intensive utilization of and growing dependence on fossil fuels militates against the internationally agreed convention on climate changes and sustainable development subscribed to by Ecuador. Promising alternatives could rely on promotion of reduction of fossil fuel utilization, combined with more efficient energy use, along with emphasis on renewable energy sources, especially hydropower, and an increased role for specific uses of solar energy. Sector-wise final energy consumption is presented in Table 3. The transport sector is the most intensive in energy consumption, with a trend of accelerating growth. The residential sector is the second most important, with a substantial share for rural areas due to intensive biomass
2. The energy sector
48
%
l
Volume V No. 3
l
September 2001
Articles
Table 3. Final consumption by sector/source (TJ) Residential
Private services
Public services
Transport
Industry
Firewood
40,790.40
-
-
-
3,270.40
Residues
-
-
-
-
Biogas
-
-
-
-
24,716.16
806.40
-
Gasoline
125.44
766.08
1,209.60
Kerosene
LPG
Others
Total
%
-
44,060.80
16.6
10,662.40
-
10,662.40
4.0
-
1.79
1.79
-
-
2,150.40
-
276,72.96
10.4
54,028.80
1,254.40
60,211.20
58,728.32
22.1
179.20
268.80
-
8,019.20
264.32
2,195.20
10,926.72
4.1
Diesel
-
4,972.80
3,360.00
42,156.80
8,288.00
7,884.80
66,666.88
25.1
Fuel oil
-
492.80
-
4,251.52
15,411.20
-
20,155.52
7.6
9,945.60
3,937.92
3,722.88
44.80
7,436.80
134.40
25,222.40
9.5
-
-
-
-
-
4.48
4.48
0.7
Electricity Wind Solar
85.12
-
-
-
-
1,680.00
1,765.12
Total
75,837.44
11,244.80
8,292.48
108,501.12
48,742.40
13,247.36
265,865.60
28.6
4.2
3.1
40.8
18.3
5.0
%
100
Sources: MEM, INECEL, INEC, Petroecuador [1995]
consumption, mainly fuelwood and residues. Favored by subsidies and an expansion policy, LPG shows high penetration rates in all sectors, especially the residential. Nevertheless, like most developing countries, Ecuador relies heavily on non-commercial energy sources, mainly firewood and residues. It is estimated that 9 % of urban and 82 % of rural demand depends on firewood and biomass residues. Firewood is supplied locally, much more through direct gathering than through organized markets, which are developed only in a few areas when scarcity aggravates. In general, the use of firewood is associated with poverty. Frequently, due to economic hardship rural and marginal urban area inhabitants cannot afford modern energy conversion equipment and appliances. 2.2. Alternative sources and energy conservation in Ecuador Alternative sources and energy conservation have not been considered a priority in Ecuador. Owing to their small contribution to the national energy balance, alternative sources have not earned special government attention. Research and development are not stimulated. There is no consistent information about nationwide use of these sources. Efforts with most sources rarely go beyond the experimental or development stage. In spite of this, there are some favorable prospects for future development of solar energy, such as the existence of installed capacity to produce some components and, at least, an incipient economic interest. Solar energy is successfully used in some low temperature processes, although it is being hampered by high costs [INECEL, 1994]. Most energy conservation initiatives have been shortlived and not capable of delivering the expected results. Conservation is not explicitly recognized as an alternative to satisfy energy requirements in the planning process. Furthermore, energy conservation is not included in energy policies in Ecuador, being only superficially considered Energy for Sustainable Development
by specific legislation for the sector. This situation can be partly explained by energy price policies that do not stimulate users to save energy nor promote opportunities for alternative sources. Other reasons are the absence of financing capacity to implement energy conservation projects and the lack of comprehensible information for consumers. Finally, the regulatory framework does not encompass rational use of energy. 2.3. Pricing policies and role of government The energy sector remains a state monopoly in Ecuador. However, petroleum and electricity sector laws have made room for larger market opening for private and foreign exploration. In the case of petroleum, prices were traditionally determined, to the detriment of technical considerations, by political approaches. Petroleum product prices stayed frozen for 22 years, up to 1981, when an adjustment policy started. However, domestic consumers have received substantial subsidies over time, maintaining a big gap between prices and economic costs, as in the case of LPG up to now. Distribution of petroleum products was transferred from the state’s hands to private companies, seeking to reduce political interference in the definition of prices, to promote greater coherence between international market oscillations and internal market behavior and to save financial resources for the state’s budget. The electricity tariff system has allowed for political manipulations and induced inefficiency among the utilities, protected by cross-subsidies, resulting in unfair cost distribution among consumer categories [FEDEMA, 1995]. The entire management of the system has proved to be inefficient, resulting in waste of energy in all sectors, and in economic losses to utilities. There is a multiplicity of controls and regulations based on environmental issues, and the use and conservation of resources. The large number of laws and regulations has l
Volume V No. 3
l
September 2001
49
Articles
Table 4. Atmospheric emissions from fuel production and use (1995) (kilotonnes, kt) Gas emitted
Total
CO2 non-biogenic
Supply/ transformation
Demand: all sectors end-use
14678.8
3750.8
10928.0
CO2 biogenic[1]
6548.8
88.0
6460.8
Carbon monoxide
1023.6
3.4
1020.2
Hydrocarbons
107.3
97.7
9.6
Aldehydes
0.003
-
0.003
Tar
0.009
-
0.009
Methane
503.3
501.9
1.4
SOx
95.4
86.9
8.5
SO2
0.0007
-
0.0007
NOx
114.2
33.8
80.4
61.3
5.5
55.8
Particulate matter < 10µ
5.9
1.2
4.7
Ammonia
5.8
5.8
-
0.000283
0.000271
0.000012
Particulate matter
Lead
Sources: MEM, DEA [1997] Note 1. Biogenic CO2 emissions are due to the use of firewood, fuelwood, coal combustion, rural wastes and sugar cane bagasse cogeneration.
Table 5. Greenhouse gas emissions by sector (1995) (kt) Sector
Non-biogenic CO2
Biogenic CO2
CO
1478.7
4421.7
251.1
1.2
767.6
-
28.2
6.0
Transportation
6240.0
-
696.2
53.3
Industry
1691.3
2039.1
21.2
9.2
750.4
-
23.4
10.7
10928.0
6460.8
1020.1
80.4
Residential Services
Others Total
sector is the most important emitter of biogenic CO2 and the second largest emitter of carbon monoxide, both originating from biomass combustion. Table 6 shows that, in the residential sector, cooking, water-heating and air-conditioning, using fossil fuels and biomass (renewable), are the main pollution sources. The major volume of greenhouse gases in this sector comes from CO2 emissions, predominantly biogenic (75 % of the pollutant charge). Cooking is responsible for almost 97 % of total emissions of CO2 in the residential sector, from biogenic and non-biogenic origin. It must be noticed (Table 6) that the use of bio-fuels characterizes residential energy in rural areas while urban demand is mainly met by LPG and other petroleum products for the same end-uses: cooking, water-heating and air-conditioning.
NOx
Sources: MEM - DEA [1997]
led to a complex system, with multiple entities each having no clearly defined responsibilities or with overlapping functions causing inefficiency. 2.4. Greenhouse gas emissions inventory Several pollutant substances are associated with the energy industry in Ecuador. Among greenhouse gases, CO2 emissions are the most significant, mainly linked to sources used to satisfy energy demand. CH4, CO and NOx emissions are also significant (Table 4). From the supply side, most CO2 emissions result from electric power generation, whereas most CH4 emissions stem from natural gas leaks that occur in combustion processes. From the demand side, the transport sector (Table 5) is the largest consumer of oil products and also the most important emitter of greenhouse gases. The residential 50
Energy for Sustainable Development
3. Assessing demand-side management (DSM) options for Ecuador’s residential sector with LEAP model Selected DSM options were evaluated in four steps: (1) characterization of the energy sector; (2) simulation of future energy demand evolution including the ranking of options in a mitigation scenario; (3) determination of levels of greenhouse gas emissions and of costs for selected mitigation measures; and (4) formulation and proposing of mechanisms to incentivize or facilitate implementation of measures. The residential sector was divided into urban and rural subsectors which, in turn, were subdivided into strata according to income levels. Two alternative scenarios were developed for this work: l
Volume V No. 3
l
September 2001
Articles
Table 6. Greenhouse gas emissions by end-use: residential sector (kt) Urban/Class Low
Medium
Rural
Total
High
Cooking CO2 non-biogenic
684.6
270.0
65.1
410.1
1429.8
CO2 biogenic
231.4
2.7
2.4
4032.4
4268.9
CO
21.6
0.3
0.1
221.0
243.0
NOx
0.606
0.179
0.043
0.268
1.096
Non-biogenic CO2
31.3
0.7
0.4
4.5
37.0
Biogenic CO2
25.7
-
-
100.2
125.9
Water-heating
CO NOx
2.2
-
-
5.5
7.7
0.035
0.0005
0.0003
0.003
0.039
Air-conditioning/heating Non-biogenic CO2 Biogenic CO2 CO
-
-
-
-
-
3.4
1.0
0.3
22.1
26.8
0.3
0.1
-
-
0.4
0.003
0.001
0.001
0.069
0.075
1.1
-
-
10.8
11.9
Biogenic CO2
-
-
-
-
-
CO
-
-
-
-
-
0.0006
-
-
0.0002
0.0008
Non-biogenic CO2
717.0
270.7
65.5
425.4
1478.7
Biogenic CO2
260.6
3.7
2.7
4154.6
4421.7
CO
24.1
0.4
0.1
226.5
251.1
NOx
0.646
0.180
0.044
0.341
1.211
NOx Lighting Non-biogenic CO2
NOx Total
a reference situation in which the context remains the same, business-as-usual, without intervention (base-line case), and an efficiency-based scenario, where energy efficiency and changes in energy matrix are considered, as a result of intervention (mitigation scenario). Both scenarios are detailed below. Cost analyses and barriers to implementing the efficient use of energy and the substitution of sources in Ecuador conclude the work. Detailed analysis of holding of energy end-use equipment and habits of use, for each stratum, as well as of technologies to be potentially deployed to improve efficiency of energy conversion, was performed and described in Morales [1997]. 3.1. The LEAP model The LEAP -- Long-Range Energy Alternatives Planning System -- model is a simulation tool, designed to aid assessment of energy policies and development of sustainable energy plans. It is a technical-economic model, in which energy is considered a complementary good, because it is not consumed independently, but in association with other goods (cookers, cars, heaters, etc.). Figure 1 displays the structure of the LEAP model. The required input data for the LEAP model are: energy consumption desegregated by sectors, sub-sectors, enduses and equipment. LEAP calculates energy balances and, by resorting to the associated environmental database (EDB), corresponding emission impacts. In addition, a future scenario can be built using available demographic Energy for Sustainable Development
projections for the analysis period. To develop alternative scenarios and to calculate their respective energy balances, environmental impacts and costs, different hypotheses regarding evolution of policies, substitution of fuels, conservation programs, etc., are established (the source material for LEAP). 3.2. Scenario development Two scenarios for the residential sector, a base-line case and a mitigation case, covering the period from 1995 to 2025, were developed. 3.2.1. Base-line case Ecuador’s base-line case was developed under the following considerations and assumptions. • Current demographic profile and projections is as shown in Table 7. • Industrial, agricultural and fishing sector participation in gross domestic product is expected to grow, transport and services are expected to stay at the same level (of participation), while exports of petroleum decrease. • Prices for electricity and LPG will increase to reflect costs, as proposed by recently enacted regulatory policies for the energy sector. • Increase in electricity and LPG prices will reduce demand due to price elasticity. • Energy intensity for all other sources of energy remains unchanged for each end-use. • No substantial changes will result from specific measures l
Volume V No. 3
l
September 2001
51
Articles
Figure 1. The LEAP model structure Source: SEI, 1995.
or introduction of energy conservation programs, except for substitution and penetration processes, involving, mainly, LPG and electricity, for different end-uses. Input data for the LEAP model were prepared on the basis of considerations and assumptions listed above. These data include, as mentioned before, desegregated consumption of energy (and trends) for sector, sub-sector, end-uses and equipment, for urban and rural areas. 3.2.2. Mitigation scenario The mitigation scenario has the following assumptions and considerations. • Economic and demographic profile, prices for LPG and electricity, energy demand of all sectors, except 52
Energy for Sustainable Development
residential and energy supply pattern, stay as in the base-line case. • Percentile of households that use firewood to cook stays as in the base-line case, for urban and rural areas, but the traditional stoves will be totally substituted by efficient stoves in the medium term, resulting in an intensity reduction between 10 % and 18 %. • Current trend of strong penetration of LPG in residential sector will remain for the future to substitute gasoline (marginal use in small stoves), kerosene, firewood and even electricity, with an expected efficiency increase between 10 % and 40 % [Geller, 1992]. • Complementary use of photovoltaic energy for cooking l
Volume V No. 3
l
September 2001
Articles
Table 7. Demographic profile and future population projection (thousands) Year
Urban area Inhabitants
%
Rural area Households
Inhabitants
%
Households
Total population
1995
6342.5
57.7
1335.3
4641.2
42.3
966.9
10983.7
2010
8571.4
59.5
1823.7
5823.2
40.5
1238.9
14394.6
2020
10326.8
61.0
2244.9
6614.3
39.0
1437.9
16941.1
2025
11457.7
62.0
2490.8
7090.4
38.0
1541.4
18548.1
Source: ILDIS, 1996
Table 8. Final energy demand (PJ) Scenario/year
2000
Base case Mitigation Difference (PJ)
2005
2010
2015
2020
2025
300.61
343.62
387.07
446.66
506.69
566.27
2.6
300.61
339.14
375.87
429.18
481.15
531.78
2.3
0.00
4.48
11.20
17.47
25.54
34.05
1.4
2.7
3.8
5.0
6.0
Diference (%)
% GR 1995-2025
Note 1. GR is the yearly average growth rate of energy demand
• •
• •
• •
will be implemented in future in at least 1 % of total households. Increments in use of solar energy for water-heating, to the level of 25 % in urban households and 14 % in rural households, are expected. Increase in deployment of modern technologies for water-heating -- such as heat pumps (2.5 to 5 % in the year 2025), power level control for showers (intensity decreasing between 10 and 20 %) -- is assumed. Total substitution of efficient for conventional refrigerators will occur in the long term (energy intensity decreasing by around 40 %). Substitution of efficient for conventional incandescent lamps, achieving, at the end of the period, the following levels: 50 % of electrified households with efficient incandescent lamps, 25 % with conventional incandescent lamps and 25 % with compact fluorescent lamps. Penetration of efficient equipment for air-conditioning (energy intensity decreasing by 15 %). For others end-uses (water-pumping, appliances), energy intensity is expected to decrease by between 10 % to 15 % due to replacement of equipment currently used by efficient devices, since they are already available in the local market.
4.1.1. Residential sub-sector The results shown in Table 9 allow us to make some comments. Annual growth rates of energy demand could change considerably: from about 1.6 % in the base-line case to 0.2 % in the mitigation scenario. Biomass consumption would decrease substantially. All other sources would show a consumption increase in both scenarios, but the growth rate of electricity is the most important in the base-line case, while solar energy presents the most significant growth in the mitigation scenario. Nevertheless solar energy stays almost insignificant in both scenarios. The difference in total energy consumption increases gradually up to the significant figure of 34.227 PJ at the end of the period. This figure corresponds, approximately, to 30 % of total residential energy consumption at the end of the analysis period. Reduction of firewood consumption alone amounts to 26.432 PJ. For LPG and electricity, the potential reduction (difference between the two scenarios) could amount to 34.2 % and 12.1 % respectively. Firewood is the most important source in the base-line case, followed by LPG. In the mitigation scenario the situation would be reversed, with LPG in first and firewood in second place. Electricity is the third in importance in both cases whereas solar is the last. As shown in Table 10, a high potential of energy conservation is expected, as much in rural areas as in urban areas, with regard to air-conditioning, public lighting and water-heating. In absolute terms, cooking is expected to allow the largest reduction of energy demand (more than 24,192 TJ), essentially due to reduction in firewood consumption. 4.2. Greenhouse gas emissions Reductions of emission levels are expected, for the energy sector as a whole, mainly for: SO2, tar, lead, biogenic
4. Results 4.1. Future energy demand according to scenarios The LEAP model generates results desegregated by sectors, sub-sectors, and end-uses, for the whole energy system, even though measures are proposed here only for the residential sector. Thus, Table 8 shows impacts on the entire energy sector demand due to actions in the residential sector. The impact of measures is significant: the difference between the forecast demand of the scenarios is up to 6 %. Energy for Sustainable Development
l
Volume V No. 3
l
September 2001
53
Articles
Table 9. Energy demand by source in residential sector (TJ) Source/year
2000
2005
2010
2015
2020
2025
Base case Firewood
43,594.88
46,332.16
48,921.60
51,739.52
54,409.60
57,106.56
LPG
25,589.76
27,220.48
30,244.48
33,810.56
37,443.84
41,619.20
8,243.20
9,493.12
10,819.20
12,346.88
13,946.24
15,832.32
Solar
94.08
107.52
116.48
129.92
143.36
161.28
Total
77,521.92
83,148.80
90,097.28
98,026.88
105,943.04
114,714.88
Electricity
Mitigation Firewood
43,594.88
42,470.40
40,544.00
38,102.40
34,782.72
30,679.04
LPG
25,589.76
26,544.00
28,752.64
31,319.68
33,792.64
36,579.20
8,243.20
8,762.88
9,188.48
9,676.80
10,039.68
10,416.00
Solar
94.08
448.00
869.12
1,424.64
2,069.76
2,835.84
Total
77,521.92
78,225.28
79,349.76
80,523.52
80,684.80
80,505.60
Firewood
-
3,861.76
8,377.60
13,637.12
19,626.88
26,427.52
LPG
-
676.48
1,491.84
2,486.40
3,651.20
5,040.00
Electricity
-
730.24
1,630.72
2,674.56
3,906.56
5,416.32
Solar
-
-
340.48
-
752.64
-
Total
-
4,928.00
10,747.52
17,503.36
25,258.24
34,209.28
Firewood
-
8.3
17.1
26.4
36.1
46.3
LPG
-
2.5
4.9
7.4
9.7
12.1
Electricity
-
7.7
15.1
21.6
28.0
34.2
Solar
-
(7.6)
(16.8)
(28.9)
(43.0)
(59.7)
Total
-
5.9
11.9
17.9
23.8
29.8
Electricity
Difference
%
Table 10. Decrease in demand levels by end-uses -- residential sector (%) End-use/year
2010
2020
2025
Urban
Rural
Urban
Rural
Urban
Rural
Cooking
5.2
14.8
10.4
30.5
13.1
38.8
Water-heating
2.4
19.3
4.3
39.9
5.0
50.6
Air-conditioning
8.0
33.2
15.6
68.8
19.4
87.2
Refrigeration
18.8
17.0
33.1
32.8
40.0
40.0
Lighting
21.2
20.5
39.9
37.6
49.2
45.0
Water-pumping
2.3
3.7
9.8
9.1
8.7
11.1
Others
4.0
4.1
8.0
7.9
10.0
10.0
Total
7.1
15.0
13.8
30.9
17.1
39.3
CO2 and CO, all except lead related to consumption of energy. Reduction in electricity demand, which would be possible through actions proposed for the mitigation scenario, would cause a considerable decrease in SOx, NOx, CO2 and particulate matter emissions, since in Ecuador electricity is largely generated by fossil fuel thermal plants. 4.2.1. Residential sub-sector Table 11 indicates important reductions in biogenic CO2, 54
Energy for Sustainable Development
CO and particulate matter and an increase in non-biogenic CO2, CH4, NOx and SOx emissions. Emissions of non-biogenic CO2 and NOx directly related to use of LPG show a growth trend in both scenarios, while particulate matter decreases slowly in the mitigation scenario (Figures 2, 3 and 4). It should be remembered that strong dissemination of LPG use is a premise of energy policy in Ecuador, adopted as an assumption for scenario development. l
Volume V No. 3
l
September 2001
Articles
Figure 2. Non-biogenic CO2 emissions (kt)
Figure 5. Biogenic CO2 emissions (kt)
Figure 3. NOx emissions (kt)
Figure 6. Biogenic CO emissions (kt)
Figure 4. Particulate matter emissions (kt)
Figure 7. Hydrocarbon emissions (kt)
The largest impacts on emission levels due to the proposed measures are expected to occur for biogenic CO2, CO and hydrocarbons (Figures 5, 6 and 7). Proposed incentives for energy efficiency and substitution of other sources for firewood explain these results. In terms of global warming potential, the results show that proposed DSM measures for mitigation could really work. Total greenhouse gas emissions are expected to decrease by around 15 % for the mitigation scenario, in comparison with the base case.
4.3. Cost/benefit considerations 4.3.1. Possible impacts on supply Considerable savings, both financial and of resources, may accrue by moving from the base case to the mitigation scenario pattern. Table 12 shows that significant oil import reductions are possible, with corresponding avoided import costs that could amount to a net present (1995 US$) value of around US$ 47 million. Electricity savings due to energy conservation could amount to US$ 84 million (1995 US$).
Energy for Sustainable Development
l
Volume V No. 3
l
September 2001
55
Articles
Table 11. Greenhouse gas emissions from residential sector Substance emitted
Scenario
2000
2005
2010
2015
2020
2025
Unit kt
CO2 non-biogenic
Base case
1512.6
1608.9
1787.7
1998.5
2213.3
2460.0
Mitigation
1512.6
1568.9
1699.5
1851.5
1997.6
2162.2
CO2 biogenic
Base case
4726.3
5023.2
5304.1
5610.2
5899.7
6192.5
Mitigation
4726.3
4631.9
4455.8
4228.6
3911.3
3514.8
CO
Base case
266.5
283.0
298.5
315.6
331.6
347.9
Mitigation
266.5
242.4
210.7
172.7
126.1
71.3
Base case
1021.9
1072.3
1118.6
1179.9
1232.4
1295.1
Mitigation
1021.9
918.4
778.0
608.7
390.5
126.1
Base case
27.0
28.8
32.0
35.7
39.6
44.0
Mitigation
27.0
28.0
30.4
33.1
35.7
38.6
Base case
918.0
950.2
973.0
1007.0
1031.0
1061.2
Mitigation
918.0
813.2
669.2
496.7
277.9
14.5
Base case
1224.4
1298.2
1424.2
1573.6
1723.6
1895.7
Mitigation
1224.4
1233.4
1281.7
1336.8
1377.2
1419.1
Base case
3502.3
3791.7
4194.5
4680.2
5166.7
5735.6
Mitigation
3502.3
3554.9
3671.6
3805.5
3880.1
3951.6
Hydrocarbons
CH4
Tar
NOx
SOx
SO2
Particulate matter
Base case
76.5
79.2
81.1
83.9
85.9
88.4
Mitigation
76.5
67.8
55.8
41.4
23.2
1.2
Base case
51.7
55.0
59.8
65.3
70.9
77.1
Mitigation
51.7
50.6
50.4
49.9
48.7
47.0
kt
kt
t
t
t
t
kg
t
kt
Table 12. Forecast LPG production and imports and electricity generation 2000
2010
2015
2020
2025
7,168.00
8,960.00
9,856.00
9,856.00
9,856.00
LPG production (PJ) Refineries Gas plants
6,854.40
14,604.80
17,964.80
17,964.80
17,964.80
14,022.40
23,564.80
27,820.80
27,820.80
27,820.80
Base case
17,696.00
12,499.20
12,902.40
17,651.20
22,937.60
Mitigation scenario
17,696.00
10,976.00
10,393.60
13,932.80
17,785.60
-
1,523.20
2,508.80
3,718.40
5,152.00
Base case
9150
11440
13450
15500
17720
Mitigation scenario
9150
10930
12600
14270
16000
-
510
850
1230
1720
Total LPG imports (PJ)
Difference Electricity generation (GWh)
Difference
4.3.2. Mitigation costs The LEAP model allows calculation of costs for changing from the base case to the mitigation case, separated into three categories: demand (rural and urban) costs; transformation (electricity generation and distribution) costs; and import costs. Results for the case described above [Morales, 1997] are shown in Tables 13 and 14, for a 10 % discount rate. Differences in consumption between the two scenarios are mainly due to improvements in residential sector efficiency, which, in turn, result from investments in effi56
Energy for Sustainable Development
cient end-use equipment. On balance, however, increased costs in the demand sector are offset by reductions in transformation sectors, enabled by improved efficiency. Lower electricity and LPG requirements allow for reduction in operating and maintenance costs and even for postponing of new plant investments, as well as for reduction in LPG imports. 4.3.3. Emission reduction costs Table 15 shows calculated levelized costs (1995 US$) to reduce future emissions, through mitigation actions (energy efficiency, sources substitution), for a 10 % discount l
Volume V No. 3
l
September 2001
Articles
Table 13. Estimated costs, 2000-2025 (1995 US$ million) 2000
2005
2010
2015
2020
2025
Urban
-
16.38
22.57
30.71
49.46
62.32
Rural
-
5.32
6.90
8.79
14.55
17.82
Sub-total
-
21.70
29.47
39.50
64.01
80.14
Gen. + distr. (elect.)
-
(7.05)
(15.75)
(25.79)
(37.73)
(61.12)
Imports (petroleum)
-
(3.72)
(8.58)
(15.36)
(24.07)
(35.64)
Sub-total
-
(10.77)
(24.33)
(41.15)
(61.80)
(96.76)
Total costs
-
10.93
5.14
(1.65)
(2.21)
(16.62)
Demand
Supply/transformation
Table 14. Costs/benefits summary (US$ million) (discount rate: 10 %) Benefits (B)
Costs (C)
NPV
B/C
Demand Urban
0.64
132.35
(131.71)
Rural
1.27
41.93
(40.66)
Sub-total
1.91
174.28
(172.37)
Gen. + distr. (electricity)
83.89
-
83.89
Imports (petroleum)
47.13
-
47.13
Sub-total
131.02
-
130.99
Total costs
132.93
174.28
(41.38)
Supply/transformation
Table 15. Calculated costs for emission reduction
rate [UNEP, 1997]. Costs in terms of equivalent CO2 emissions are also shown. Emission reduction costs are strongly dependent on pollutant type. Very low costs are obtained, for example, for carbon dioxide and monoxide, because of the large amount of reductions obtained.
CO2 non-biogenic
5. Implementation of mitigation measures
CO2 biogenic
Pollutant
Technological solutions capable of controlling emissions exist, even though sometimes they carry high costs. These solutions are not applicable to Ecuador in the medium term. That is why energy efficiency programs assume great importance. The following considerations exclusively concern energy efficiency measures as a mitigation mechanism for greenhouse gas emissions. Imperfections of Ecuador’s energy market, besides failures of historically adopted political decisions, make up the background responsible for maintaining barriers opposed to energy efficiency and the substitution of energy sources in the country. Among the main obstacles are: lack of information, high initial cost of technologies, poverty and economic constraints of population, inadequate subsidies (promoting waste of energy and obstructing Energy for Sustainable Development
0.7626
Reduction average (kt/yr) 119.48
0.03
1013.84
0.00
104.81
0.04
Hydrocarbons
1.15
3.45
CH4
0.22
20.00
NOx
0.20
19.39
SOx
0.11
30.00
SO2
0.03
124.81
11.32
0.35
192.33 (kt/yr)
20.63 (US$ 1995/t)
CO
Particulate matter Equivalent CO2
l
Levelized emission reduction costs (US$1995 /kg)
Volume V No. 3
l
September 2001
57
Articles
Table 16. Propositions for implementation of DSM/IRP programs Step
Objectives
Preparatory actions
Development of regulatory instruments
Design of DSM programs
Activities
Elimination of distortions
To define government’s role as regulator or manager/producer
To prepare the ideal atmosphere for the adoption of conservation measures
To evaluate and eliminate market and political distortions, consistent with required social protection policies
To prepare specific legislation for DSM implementation
To stimulate DSM programs
To apply DSM programs
Labeling programs
To develop pilot programs for realistic assessments
Energy audit programs Fund availability Technology transfer Table 17. Recommendations for implementation of DSM/IRP programs Barriers
Regulatory instruments
Sub-program examples
Solutions
Lack of information on energy sector performance
Incentivize least cost criterion for planning
Energy audits
Technology transfer and development
Lack of funds for DSM programs
Efficiency rules and standards
ESCOs implantation
Equipment replacement
Too high initial investment costs
Performance tests
Financing programs
Educational campaigns
Absence of efficient equipment in domestic market
Labeling
Load management
Other specific solutions applied case by case
Consumption habits
Environmental externalities accounting
Development of alternative energy programs
Economic uncertainties
formation of a competitive market) and, lastly, the lack of regulatory instruments to implement energy efficiency. Implementation and development of energy efficiency programs must aim at market transformation and should be preferably inserted in an integrated resource planning (IRP) context. The following steps should be pursued: • a preparatory process of consideration and adjustment of the government’s role, distinguishing its double role as manager/producer and regulator/provider, concretized by formulation of a consistent set of policies; • development of an adequate regulatory framework with clear rules and mechanisms to guide implementation of DSM programs; and • implementation of demand-side management programs, including formulation of rules and innovative financing mechanisms to promote new investments in the sector. Tables 16 and 17 summarize some propositions and recommendations to implement DSM programs in an IRP framework in Ecuador.
energy conservation programs, deployment of efficient technologies and enhanced use of alternative/renewable energy sources. Implementation of evaluated measures could result in a 6 % reduction of global energy demand for the country and a much higher impact on individual sources or sectors. Minimizing biomass consumption, through efficiency improvement and substitution by LPG, will avoid emissions and may avoid net greenhouse emissions. However, further research on the whole carbon cycle associated with firewood supply to the residential sector is required, to adequately evaluate the degree of process sustainability. Results of this work warrant the formulation of policies to stimulate and indeed to implement programs and actions of DSM. Nevertheless, it seems that the most difficult obstacle to reaching this goal is lack of information at the governmental and individual levels. Dissemination of knowledge and information seems to be essential. Alvaro Cesar Morales can be contacted at: E-mail: [email protected] Ildo Luis Sauer can be contacted at: Phone: +55 11 818 4912 Fax: + 55 11 816 7828, E-mail: [email protected]
6. Conclusions There is a great potential for reducing fuel demand in the residential sector of Ecuador and, consequently, greenhouse gas emissions, which may be pursued through 58
Energy for Sustainable Development
l
Volume V No. 3
l
September 2001
Articles
Assessment Working Group of the IPCC, United Nations Environment Programme, Washington, USA.
Note 1. While pursuing a Master’s degree program at USP, the first author was supported by a fellowship from International Energy Initiative (IEI).
Ministerio de Energía y Minas (MEM), Petroecuador, 1972. Estadísticas Hidrocarburíferas, Quito.
References
Ministerio de Energía y Minas (MEM), 1996. Balance Energético Nacional 1995, Quito.
Fundación Ecuatoriana de Estudios Energeticos y Medioambientales (FEDEMA), 1996. Estudio sobre Políticas Energéticas del Ecuador, Quito.
Ministerio de Energía y Minas -- Dirección de Energías Alternativas (MEM - DEA), 1997. Inventario de Gases de Efecto Invernadero: Caso Ecuador, USCSP, Quito (preliminary).
Geller, H., 1991. Efficient Electricity Use: A Development Strategy for Brazil, American Council for an Energy Efficient Economy, Washington.
Morales, A., 1997. A Mitigação de Gases de Efeito Estufa Associados ao Consumo Energético do Equador: O Caso do Setor Residencial, Dissertação de Mestrado, Universidade de São Paulo, Programa Interunidades de Pós Graduação em Energia, São Paulo, Brazil.
Instituto Latinoamericano de Investigaciones Sociales (ILDIS), 1996. Projeções da População do Ecuador, BCE, Quito.
Petroecuador, 1995. Ley Reformatoria a la Ley de Hidrocarburos, Quito.
Instituto Nacional de Estadísticas y Censos (INEC), 1992. Resultados del Censo de Población y Vivienda de 1990, Quito.
Stockholm Environment Institute (SEI), 1995. LEAP User Guide for Version 95, Boston Center, Tellus Institute, Boston, USA.
Instituto Ecuatoriano de Electrificación (INECEL), 1994. Estudio Previo a la Implantación del Programa de Administración de la Demanda y Uso Racional de la Energía Eléctrica en el Ecuador, Quito.
United Nations Environment Programme Collaborating Centre on Energy and Environment (UNEP), 1997. The Economics of Greenhouse Gas Limitation Guidelines, Riso National Laboratory, Denmark.
Intergovernmental Panel on Climate Change (IPCC), 1995. The 1994 Report of the Scientific
As regular readers are aware, Energy for Sustainable Development has published special issues on several subjects during 2000 and 2001. More special issues are planned on the following subjects: ¤
The WGES energy perspective for China
¤
Sri Lanka
¤
Energy efficiency
¤
New technologies
These special issues will be produced during 2001 and 2002. The special issue on the WGES energy perspective for China is our next issue.
Energy for Sustainable Development
l
Volume V No. 3
l
September 2001
59
Mitigation of greenhouse gas emissions originating from energy consumption by the residential sector in Ecuador Alvaro Cesar Morales Calle Paez 884 y Mercadillo, Ed. Interandino, Quito, Ecuador[1] Ildo Luis Sauer University of São Paulo (USP), Graduate Program on Energy, Av. Professor Luciano Gualberto 1289 SP, São Paulo -- SP, Brazil 05508-900
Ecuador presents a singular pattern of energy consumption, based, mainly, on fossil fuels. Such a situation is, from both environmental and economic points of view, neither desirable nor strategic for the country, a signatory to United Nations Framework Convention on Climate Change (UNFCCC). However, the current transition that the energy sector in Ecuador is undergoing may enable solutions based on demand-side management (DSM). The purpose of this work is to investigate the use of DSM measures that may lead to reduction in fossil fuel demand and thus mitigate greenhouse gas emissions in Ecuador. Technical and economic assessments are carried out through construction of scenarios with the Long-Range Energy Alternatives Planning System (LEAP) model. Results show attractiveness of measures based both on substitution of energy sources and on energy efficiency. 1. Introduction Modern society’s energy requirements have continuously increased because of population growth and the intrinsic demand for goods and services. Energy production and use disturb in many ways the ecological equilibrium of the planet. Fuel combustion represents the most significant source of greenhouse gas emissions, resulting in climate changes. Global warming was recognized in 1992, at the Rio de Janeiro Conference, as a controllable but irreversible process, being the most serious menace to future generations in terms of environmental sustainability and economic development. Seeking solutions to this collective problem, around 150 countries subscribed to the United Nations Framework Convention on Climate Change (UNFCCC), a legal basis for international cooperation and action towards controlling the phenomenon. Ecuador was among these UNFCCC signatory countries. The Third and Fourth Conferences of Parties, held in Kyoto and Buenos Aires, introduced economic and commercial elements to allow and enhance climate change mitigation measures, through ‘‘flexibility mechanisms’’ (including clean development mechanisms -- CDMs). When ratified, these mechanisms will establish a new kind of international trade, capable of generating intense flow of resources directed towards mitigation measures. It is expected that the growth of internal markets for technology development will be stimulated in many countries. On the other hand, there is no consensus yet about the degree of obligation binding developed and developing Energy for Sustainable Development
countries to emission reduction targets (Annex 1 countries) [IPCC, 1995]. Latin America can play a significant role in this landscape, at least as an interesting market for CDM implementation. Nevertheless, the crucial question is another one. It is well known that developing countries contribute only a small fraction of both current and accumulated global emissions. However, economic growth and social improvement depends strongly on increasing availability of energy services. The challenge is how to grow with a smaller or more efficient and sustainable energy consumption pattern. Technological alternatives exist to cope with environmental obligations while maintaining social goals and acquiring strategic advantages in CDM negotiations. In the energy sector it is possible and reasonable to promote energy efficiency as well as utilization of non-fossil fuels. Prevailing typical energy consumption patterns make it difficult for Ecuador to meet the goals of UNFCCC. To succeed, a strong effort to change the country’s energy balance will be required. Fortunately, positive developments on clean energy sources are creating favorable expectations for the development of efficient use of energy in the country. The aim of this work is to assess strategies seeking reduction of greenhouse gas emissions related to the energy consumption of the residential sector. The specific objectives are: • to identify and to analyze options for mitigation of greenhouse gas emissions in the residential sector; l
Volume V No. 3
l
September 2001
47
Articles
Table 1. Available energy resources in Ecuador (PJ) Resource
Crude oil
Reserves %
Natural gas
Coal
Hydropower
Geothermal
Biomass
Total
22,543.36
815.36
680.96
356,339.20
2,441.60
3,113.60
385,934.08
5.9
0.2
0.2
92.3
0.6
0.8
100.0
Table 2. Domestic energy supply, 1995 Sources Primary (1,049,708.80 GJ -- 100 %)
TJ Hydrocarbons
966,201.60
92
Biomass
54,745.60
5.2
Hydropower
26,969.60
2.6
1,792.00
0.2
286,764.80
89.6
1.79
-
33,196.80
10.4
Renewable Secondary (319,961.60 GJ -- 100 %)
Petroleum products Biogas Electricity Thermal
7,168.00
Hydro
25,356.80
Cogeneration
• to calculate future levels of greenhouse gas emissions due to energy consumption, to serve as a base-line case, without intervention, for comparison with the results of a proposed alternative scenario; • to propose base guidelines and develop a future scenario that includes mitigation alternatives; • to evaluate the potential of selected options to mitigate greenhouse gas emissions, their viability and costs; and • to propose mechanisms and strategies that may allow implementation of mitigation measures.
2.1. Energy consumption characteristics Ecuador is endowed with a large number of renewable and non-renewable resources, as shown in Table 1, among them, hydropower and petroleum appearing as the most important. Oil is of highest economic importance for the country’s foreign trade balance. Nevertheless, in terms of energy supply, as shown in Table 2, hydrocarbons are the most utilized source, followed by biomass, while hydropower carries smaller importance. Solar energy, although currently negligible, is perceived as an interesting resource to be exploited in the future, due to favorable solar radiation levels in several regions in the country. Some areas are able to generate up to 4 kWh/m2/day. As secondary energy sources, petroleum products appear, again, as the main resource in Ecuador while electricity is the second most important with a considerable contribution from oil-based thermal generation. Table 2 also shows the country’s strong dependence on hydrocarbons, close to 90 % as primary and secondary energy source. Currently Ecuador is self-sufficient in oil, with exports Energy for Sustainable Development
672.00
exceeding imports. However, the oil sector is entering a critical period because of issues such as: decreasing quality and quantity of reserves; inadequate exploitation and production strategy; uncertainty about oil resources; growth of domestic consumption; need to increase exports to generate hard currency; strong dependence of energy profile on hydrocarbons; imbalance between supply and demand of oil products combined with inadequate refining infrastructure; and a need to adapt to process heavier oils. The electricity sector, the second most important, is also facing a severe crisis. Technical and non-technical electricity losses are high; financial resources are insufficient, impairing investment capacity; management is deficient. Service quality is decreasing constantly and supply restrictions impose a need to resort to rationing. The need for the sector’s restructuring and reorganization is becoming urgent. To this end a new electricity sector law has been enacted, redefining the government’s role and stimulating more responsible and qualified management of utilities. In sum, the traditional scheme of energy production is no longer able to cope with the country’s needs in the medium term. Moreover, intensive utilization of and growing dependence on fossil fuels militates against the internationally agreed convention on climate changes and sustainable development subscribed to by Ecuador. Promising alternatives could rely on promotion of reduction of fossil fuel utilization, combined with more efficient energy use, along with emphasis on renewable energy sources, especially hydropower, and an increased role for specific uses of solar energy. Sector-wise final energy consumption is presented in Table 3. The transport sector is the most intensive in energy consumption, with a trend of accelerating growth. The residential sector is the second most important, with a substantial share for rural areas due to intensive biomass
2. The energy sector
48
%
l
Volume V No. 3
l
September 2001
Articles
Table 3. Final consumption by sector/source (TJ) Residential
Private services
Public services
Transport
Industry
Firewood
40,790.40
-
-
-
3,270.40
Residues
-
-
-
-
Biogas
-
-
-
-
24,716.16
806.40
-
Gasoline
125.44
766.08
1,209.60
Kerosene
LPG
Others
Total
%
-
44,060.80
16.6
10,662.40
-
10,662.40
4.0
-
1.79
1.79
-
-
2,150.40
-
276,72.96
10.4
54,028.80
1,254.40
60,211.20
58,728.32
22.1
179.20
268.80
-
8,019.20
264.32
2,195.20
10,926.72
4.1
Diesel
-
4,972.80
3,360.00
42,156.80
8,288.00
7,884.80
66,666.88
25.1
Fuel oil
-
492.80
-
4,251.52
15,411.20
-
20,155.52
7.6
9,945.60
3,937.92
3,722.88
44.80
7,436.80
134.40
25,222.40
9.5
-
-
-
-
-
4.48
4.48
0.7
Electricity Wind Solar
85.12
-
-
-
-
1,680.00
1,765.12
Total
75,837.44
11,244.80
8,292.48
108,501.12
48,742.40
13,247.36
265,865.60
28.6
4.2
3.1
40.8
18.3
5.0
%
100
Sources: MEM, INECEL, INEC, Petroecuador [1995]
consumption, mainly fuelwood and residues. Favored by subsidies and an expansion policy, LPG shows high penetration rates in all sectors, especially the residential. Nevertheless, like most developing countries, Ecuador relies heavily on non-commercial energy sources, mainly firewood and residues. It is estimated that 9 % of urban and 82 % of rural demand depends on firewood and biomass residues. Firewood is supplied locally, much more through direct gathering than through organized markets, which are developed only in a few areas when scarcity aggravates. In general, the use of firewood is associated with poverty. Frequently, due to economic hardship rural and marginal urban area inhabitants cannot afford modern energy conversion equipment and appliances. 2.2. Alternative sources and energy conservation in Ecuador Alternative sources and energy conservation have not been considered a priority in Ecuador. Owing to their small contribution to the national energy balance, alternative sources have not earned special government attention. Research and development are not stimulated. There is no consistent information about nationwide use of these sources. Efforts with most sources rarely go beyond the experimental or development stage. In spite of this, there are some favorable prospects for future development of solar energy, such as the existence of installed capacity to produce some components and, at least, an incipient economic interest. Solar energy is successfully used in some low temperature processes, although it is being hampered by high costs [INECEL, 1994]. Most energy conservation initiatives have been shortlived and not capable of delivering the expected results. Conservation is not explicitly recognized as an alternative to satisfy energy requirements in the planning process. Furthermore, energy conservation is not included in energy policies in Ecuador, being only superficially considered Energy for Sustainable Development
by specific legislation for the sector. This situation can be partly explained by energy price policies that do not stimulate users to save energy nor promote opportunities for alternative sources. Other reasons are the absence of financing capacity to implement energy conservation projects and the lack of comprehensible information for consumers. Finally, the regulatory framework does not encompass rational use of energy. 2.3. Pricing policies and role of government The energy sector remains a state monopoly in Ecuador. However, petroleum and electricity sector laws have made room for larger market opening for private and foreign exploration. In the case of petroleum, prices were traditionally determined, to the detriment of technical considerations, by political approaches. Petroleum product prices stayed frozen for 22 years, up to 1981, when an adjustment policy started. However, domestic consumers have received substantial subsidies over time, maintaining a big gap between prices and economic costs, as in the case of LPG up to now. Distribution of petroleum products was transferred from the state’s hands to private companies, seeking to reduce political interference in the definition of prices, to promote greater coherence between international market oscillations and internal market behavior and to save financial resources for the state’s budget. The electricity tariff system has allowed for political manipulations and induced inefficiency among the utilities, protected by cross-subsidies, resulting in unfair cost distribution among consumer categories [FEDEMA, 1995]. The entire management of the system has proved to be inefficient, resulting in waste of energy in all sectors, and in economic losses to utilities. There is a multiplicity of controls and regulations based on environmental issues, and the use and conservation of resources. The large number of laws and regulations has l
Volume V No. 3
l
September 2001
49
Articles
Table 4. Atmospheric emissions from fuel production and use (1995) (kilotonnes, kt) Gas emitted
Total
CO2 non-biogenic
Supply/ transformation
Demand: all sectors end-use
14678.8
3750.8
10928.0
CO2 biogenic[1]
6548.8
88.0
6460.8
Carbon monoxide
1023.6
3.4
1020.2
Hydrocarbons
107.3
97.7
9.6
Aldehydes
0.003
-
0.003
Tar
0.009
-
0.009
Methane
503.3
501.9
1.4
SOx
95.4
86.9
8.5
SO2
0.0007
-
0.0007
NOx
114.2
33.8
80.4
61.3
5.5
55.8
Particulate matter < 10µ
5.9
1.2
4.7
Ammonia
5.8
5.8
-
0.000283
0.000271
0.000012
Particulate matter
Lead
Sources: MEM, DEA [1997] Note 1. Biogenic CO2 emissions are due to the use of firewood, fuelwood, coal combustion, rural wastes and sugar cane bagasse cogeneration.
Table 5. Greenhouse gas emissions by sector (1995) (kt) Sector
Non-biogenic CO2
Biogenic CO2
CO
1478.7
4421.7
251.1
1.2
767.6
-
28.2
6.0
Transportation
6240.0
-
696.2
53.3
Industry
1691.3
2039.1
21.2
9.2
750.4
-
23.4
10.7
10928.0
6460.8
1020.1
80.4
Residential Services
Others Total
sector is the most important emitter of biogenic CO2 and the second largest emitter of carbon monoxide, both originating from biomass combustion. Table 6 shows that, in the residential sector, cooking, water-heating and air-conditioning, using fossil fuels and biomass (renewable), are the main pollution sources. The major volume of greenhouse gases in this sector comes from CO2 emissions, predominantly biogenic (75 % of the pollutant charge). Cooking is responsible for almost 97 % of total emissions of CO2 in the residential sector, from biogenic and non-biogenic origin. It must be noticed (Table 6) that the use of bio-fuels characterizes residential energy in rural areas while urban demand is mainly met by LPG and other petroleum products for the same end-uses: cooking, water-heating and air-conditioning.
NOx
Sources: MEM - DEA [1997]
led to a complex system, with multiple entities each having no clearly defined responsibilities or with overlapping functions causing inefficiency. 2.4. Greenhouse gas emissions inventory Several pollutant substances are associated with the energy industry in Ecuador. Among greenhouse gases, CO2 emissions are the most significant, mainly linked to sources used to satisfy energy demand. CH4, CO and NOx emissions are also significant (Table 4). From the supply side, most CO2 emissions result from electric power generation, whereas most CH4 emissions stem from natural gas leaks that occur in combustion processes. From the demand side, the transport sector (Table 5) is the largest consumer of oil products and also the most important emitter of greenhouse gases. The residential 50
Energy for Sustainable Development
3. Assessing demand-side management (DSM) options for Ecuador’s residential sector with LEAP model Selected DSM options were evaluated in four steps: (1) characterization of the energy sector; (2) simulation of future energy demand evolution including the ranking of options in a mitigation scenario; (3) determination of levels of greenhouse gas emissions and of costs for selected mitigation measures; and (4) formulation and proposing of mechanisms to incentivize or facilitate implementation of measures. The residential sector was divided into urban and rural subsectors which, in turn, were subdivided into strata according to income levels. Two alternative scenarios were developed for this work: l
Volume V No. 3
l
September 2001
Articles
Table 6. Greenhouse gas emissions by end-use: residential sector (kt) Urban/Class Low
Medium
Rural
Total
High
Cooking CO2 non-biogenic
684.6
270.0
65.1
410.1
1429.8
CO2 biogenic
231.4
2.7
2.4
4032.4
4268.9
CO
21.6
0.3
0.1
221.0
243.0
NOx
0.606
0.179
0.043
0.268
1.096
Non-biogenic CO2
31.3
0.7
0.4
4.5
37.0
Biogenic CO2
25.7
-
-
100.2
125.9
Water-heating
CO NOx
2.2
-
-
5.5
7.7
0.035
0.0005
0.0003
0.003
0.039
Air-conditioning/heating Non-biogenic CO2 Biogenic CO2 CO
-
-
-
-
-
3.4
1.0
0.3
22.1
26.8
0.3
0.1
-
-
0.4
0.003
0.001
0.001
0.069
0.075
1.1
-
-
10.8
11.9
Biogenic CO2
-
-
-
-
-
CO
-
-
-
-
-
0.0006
-
-
0.0002
0.0008
Non-biogenic CO2
717.0
270.7
65.5
425.4
1478.7
Biogenic CO2
260.6
3.7
2.7
4154.6
4421.7
CO
24.1
0.4
0.1
226.5
251.1
NOx
0.646
0.180
0.044
0.341
1.211
NOx Lighting Non-biogenic CO2
NOx Total
a reference situation in which the context remains the same, business-as-usual, without intervention (base-line case), and an efficiency-based scenario, where energy efficiency and changes in energy matrix are considered, as a result of intervention (mitigation scenario). Both scenarios are detailed below. Cost analyses and barriers to implementing the efficient use of energy and the substitution of sources in Ecuador conclude the work. Detailed analysis of holding of energy end-use equipment and habits of use, for each stratum, as well as of technologies to be potentially deployed to improve efficiency of energy conversion, was performed and described in Morales [1997]. 3.1. The LEAP model The LEAP -- Long-Range Energy Alternatives Planning System -- model is a simulation tool, designed to aid assessment of energy policies and development of sustainable energy plans. It is a technical-economic model, in which energy is considered a complementary good, because it is not consumed independently, but in association with other goods (cookers, cars, heaters, etc.). Figure 1 displays the structure of the LEAP model. The required input data for the LEAP model are: energy consumption desegregated by sectors, sub-sectors, enduses and equipment. LEAP calculates energy balances and, by resorting to the associated environmental database (EDB), corresponding emission impacts. In addition, a future scenario can be built using available demographic Energy for Sustainable Development
projections for the analysis period. To develop alternative scenarios and to calculate their respective energy balances, environmental impacts and costs, different hypotheses regarding evolution of policies, substitution of fuels, conservation programs, etc., are established (the source material for LEAP). 3.2. Scenario development Two scenarios for the residential sector, a base-line case and a mitigation case, covering the period from 1995 to 2025, were developed. 3.2.1. Base-line case Ecuador’s base-line case was developed under the following considerations and assumptions. • Current demographic profile and projections is as shown in Table 7. • Industrial, agricultural and fishing sector participation in gross domestic product is expected to grow, transport and services are expected to stay at the same level (of participation), while exports of petroleum decrease. • Prices for electricity and LPG will increase to reflect costs, as proposed by recently enacted regulatory policies for the energy sector. • Increase in electricity and LPG prices will reduce demand due to price elasticity. • Energy intensity for all other sources of energy remains unchanged for each end-use. • No substantial changes will result from specific measures l
Volume V No. 3
l
September 2001
51
Articles
Figure 1. The LEAP model structure Source: SEI, 1995.
or introduction of energy conservation programs, except for substitution and penetration processes, involving, mainly, LPG and electricity, for different end-uses. Input data for the LEAP model were prepared on the basis of considerations and assumptions listed above. These data include, as mentioned before, desegregated consumption of energy (and trends) for sector, sub-sector, end-uses and equipment, for urban and rural areas. 3.2.2. Mitigation scenario The mitigation scenario has the following assumptions and considerations. • Economic and demographic profile, prices for LPG and electricity, energy demand of all sectors, except 52
Energy for Sustainable Development
residential and energy supply pattern, stay as in the base-line case. • Percentile of households that use firewood to cook stays as in the base-line case, for urban and rural areas, but the traditional stoves will be totally substituted by efficient stoves in the medium term, resulting in an intensity reduction between 10 % and 18 %. • Current trend of strong penetration of LPG in residential sector will remain for the future to substitute gasoline (marginal use in small stoves), kerosene, firewood and even electricity, with an expected efficiency increase between 10 % and 40 % [Geller, 1992]. • Complementary use of photovoltaic energy for cooking l
Volume V No. 3
l
September 2001
Articles
Table 7. Demographic profile and future population projection (thousands) Year
Urban area Inhabitants
%
Rural area Households
Inhabitants
%
Households
Total population
1995
6342.5
57.7
1335.3
4641.2
42.3
966.9
10983.7
2010
8571.4
59.5
1823.7
5823.2
40.5
1238.9
14394.6
2020
10326.8
61.0
2244.9
6614.3
39.0
1437.9
16941.1
2025
11457.7
62.0
2490.8
7090.4
38.0
1541.4
18548.1
Source: ILDIS, 1996
Table 8. Final energy demand (PJ) Scenario/year
2000
Base case Mitigation Difference (PJ)
2005
2010
2015
2020
2025
300.61
343.62
387.07
446.66
506.69
566.27
2.6
300.61
339.14
375.87
429.18
481.15
531.78
2.3
0.00
4.48
11.20
17.47
25.54
34.05
1.4
2.7
3.8
5.0
6.0
Diference (%)
% GR 1995-2025
Note 1. GR is the yearly average growth rate of energy demand
• •
• •
• •
will be implemented in future in at least 1 % of total households. Increments in use of solar energy for water-heating, to the level of 25 % in urban households and 14 % in rural households, are expected. Increase in deployment of modern technologies for water-heating -- such as heat pumps (2.5 to 5 % in the year 2025), power level control for showers (intensity decreasing between 10 and 20 %) -- is assumed. Total substitution of efficient for conventional refrigerators will occur in the long term (energy intensity decreasing by around 40 %). Substitution of efficient for conventional incandescent lamps, achieving, at the end of the period, the following levels: 50 % of electrified households with efficient incandescent lamps, 25 % with conventional incandescent lamps and 25 % with compact fluorescent lamps. Penetration of efficient equipment for air-conditioning (energy intensity decreasing by 15 %). For others end-uses (water-pumping, appliances), energy intensity is expected to decrease by between 10 % to 15 % due to replacement of equipment currently used by efficient devices, since they are already available in the local market.
4.1.1. Residential sub-sector The results shown in Table 9 allow us to make some comments. Annual growth rates of energy demand could change considerably: from about 1.6 % in the base-line case to 0.2 % in the mitigation scenario. Biomass consumption would decrease substantially. All other sources would show a consumption increase in both scenarios, but the growth rate of electricity is the most important in the base-line case, while solar energy presents the most significant growth in the mitigation scenario. Nevertheless solar energy stays almost insignificant in both scenarios. The difference in total energy consumption increases gradually up to the significant figure of 34.227 PJ at the end of the period. This figure corresponds, approximately, to 30 % of total residential energy consumption at the end of the analysis period. Reduction of firewood consumption alone amounts to 26.432 PJ. For LPG and electricity, the potential reduction (difference between the two scenarios) could amount to 34.2 % and 12.1 % respectively. Firewood is the most important source in the base-line case, followed by LPG. In the mitigation scenario the situation would be reversed, with LPG in first and firewood in second place. Electricity is the third in importance in both cases whereas solar is the last. As shown in Table 10, a high potential of energy conservation is expected, as much in rural areas as in urban areas, with regard to air-conditioning, public lighting and water-heating. In absolute terms, cooking is expected to allow the largest reduction of energy demand (more than 24,192 TJ), essentially due to reduction in firewood consumption. 4.2. Greenhouse gas emissions Reductions of emission levels are expected, for the energy sector as a whole, mainly for: SO2, tar, lead, biogenic
4. Results 4.1. Future energy demand according to scenarios The LEAP model generates results desegregated by sectors, sub-sectors, and end-uses, for the whole energy system, even though measures are proposed here only for the residential sector. Thus, Table 8 shows impacts on the entire energy sector demand due to actions in the residential sector. The impact of measures is significant: the difference between the forecast demand of the scenarios is up to 6 %. Energy for Sustainable Development
l
Volume V No. 3
l
September 2001
53
Articles
Table 9. Energy demand by source in residential sector (TJ) Source/year
2000
2005
2010
2015
2020
2025
Base case Firewood
43,594.88
46,332.16
48,921.60
51,739.52
54,409.60
57,106.56
LPG
25,589.76
27,220.48
30,244.48
33,810.56
37,443.84
41,619.20
8,243.20
9,493.12
10,819.20
12,346.88
13,946.24
15,832.32
Solar
94.08
107.52
116.48
129.92
143.36
161.28
Total
77,521.92
83,148.80
90,097.28
98,026.88
105,943.04
114,714.88
Electricity
Mitigation Firewood
43,594.88
42,470.40
40,544.00
38,102.40
34,782.72
30,679.04
LPG
25,589.76
26,544.00
28,752.64
31,319.68
33,792.64
36,579.20
8,243.20
8,762.88
9,188.48
9,676.80
10,039.68
10,416.00
Solar
94.08
448.00
869.12
1,424.64
2,069.76
2,835.84
Total
77,521.92
78,225.28
79,349.76
80,523.52
80,684.80
80,505.60
Firewood
-
3,861.76
8,377.60
13,637.12
19,626.88
26,427.52
LPG
-
676.48
1,491.84
2,486.40
3,651.20
5,040.00
Electricity
-
730.24
1,630.72
2,674.56
3,906.56
5,416.32
Solar
-
-
340.48
-
752.64
-
Total
-
4,928.00
10,747.52
17,503.36
25,258.24
34,209.28
Firewood
-
8.3
17.1
26.4
36.1
46.3
LPG
-
2.5
4.9
7.4
9.7
12.1
Electricity
-
7.7
15.1
21.6
28.0
34.2
Solar
-
(7.6)
(16.8)
(28.9)
(43.0)
(59.7)
Total
-
5.9
11.9
17.9
23.8
29.8
Electricity
Difference
%
Table 10. Decrease in demand levels by end-uses -- residential sector (%) End-use/year
2010
2020
2025
Urban
Rural
Urban
Rural
Urban
Rural
Cooking
5.2
14.8
10.4
30.5
13.1
38.8
Water-heating
2.4
19.3
4.3
39.9
5.0
50.6
Air-conditioning
8.0
33.2
15.6
68.8
19.4
87.2
Refrigeration
18.8
17.0
33.1
32.8
40.0
40.0
Lighting
21.2
20.5
39.9
37.6
49.2
45.0
Water-pumping
2.3
3.7
9.8
9.1
8.7
11.1
Others
4.0
4.1
8.0
7.9
10.0
10.0
Total
7.1
15.0
13.8
30.9
17.1
39.3
CO2 and CO, all except lead related to consumption of energy. Reduction in electricity demand, which would be possible through actions proposed for the mitigation scenario, would cause a considerable decrease in SOx, NOx, CO2 and particulate matter emissions, since in Ecuador electricity is largely generated by fossil fuel thermal plants. 4.2.1. Residential sub-sector Table 11 indicates important reductions in biogenic CO2, 54
Energy for Sustainable Development
CO and particulate matter and an increase in non-biogenic CO2, CH4, NOx and SOx emissions. Emissions of non-biogenic CO2 and NOx directly related to use of LPG show a growth trend in both scenarios, while particulate matter decreases slowly in the mitigation scenario (Figures 2, 3 and 4). It should be remembered that strong dissemination of LPG use is a premise of energy policy in Ecuador, adopted as an assumption for scenario development. l
Volume V No. 3
l
September 2001
Articles
Figure 2. Non-biogenic CO2 emissions (kt)
Figure 5. Biogenic CO2 emissions (kt)
Figure 3. NOx emissions (kt)
Figure 6. Biogenic CO emissions (kt)
Figure 4. Particulate matter emissions (kt)
Figure 7. Hydrocarbon emissions (kt)
The largest impacts on emission levels due to the proposed measures are expected to occur for biogenic CO2, CO and hydrocarbons (Figures 5, 6 and 7). Proposed incentives for energy efficiency and substitution of other sources for firewood explain these results. In terms of global warming potential, the results show that proposed DSM measures for mitigation could really work. Total greenhouse gas emissions are expected to decrease by around 15 % for the mitigation scenario, in comparison with the base case.
4.3. Cost/benefit considerations 4.3.1. Possible impacts on supply Considerable savings, both financial and of resources, may accrue by moving from the base case to the mitigation scenario pattern. Table 12 shows that significant oil import reductions are possible, with corresponding avoided import costs that could amount to a net present (1995 US$) value of around US$ 47 million. Electricity savings due to energy conservation could amount to US$ 84 million (1995 US$).
Energy for Sustainable Development
l
Volume V No. 3
l
September 2001
55
Articles
Table 11. Greenhouse gas emissions from residential sector Substance emitted
Scenario
2000
2005
2010
2015
2020
2025
Unit kt
CO2 non-biogenic
Base case
1512.6
1608.9
1787.7
1998.5
2213.3
2460.0
Mitigation
1512.6
1568.9
1699.5
1851.5
1997.6
2162.2
CO2 biogenic
Base case
4726.3
5023.2
5304.1
5610.2
5899.7
6192.5
Mitigation
4726.3
4631.9
4455.8
4228.6
3911.3
3514.8
CO
Base case
266.5
283.0
298.5
315.6
331.6
347.9
Mitigation
266.5
242.4
210.7
172.7
126.1
71.3
Base case
1021.9
1072.3
1118.6
1179.9
1232.4
1295.1
Mitigation
1021.9
918.4
778.0
608.7
390.5
126.1
Base case
27.0
28.8
32.0
35.7
39.6
44.0
Mitigation
27.0
28.0
30.4
33.1
35.7
38.6
Base case
918.0
950.2
973.0
1007.0
1031.0
1061.2
Mitigation
918.0
813.2
669.2
496.7
277.9
14.5
Base case
1224.4
1298.2
1424.2
1573.6
1723.6
1895.7
Mitigation
1224.4
1233.4
1281.7
1336.8
1377.2
1419.1
Base case
3502.3
3791.7
4194.5
4680.2
5166.7
5735.6
Mitigation
3502.3
3554.9
3671.6
3805.5
3880.1
3951.6
Hydrocarbons
CH4
Tar
NOx
SOx
SO2
Particulate matter
Base case
76.5
79.2
81.1
83.9
85.9
88.4
Mitigation
76.5
67.8
55.8
41.4
23.2
1.2
Base case
51.7
55.0
59.8
65.3
70.9
77.1
Mitigation
51.7
50.6
50.4
49.9
48.7
47.0
kt
kt
t
t
t
t
kg
t
kt
Table 12. Forecast LPG production and imports and electricity generation 2000
2010
2015
2020
2025
7,168.00
8,960.00
9,856.00
9,856.00
9,856.00
LPG production (PJ) Refineries Gas plants
6,854.40
14,604.80
17,964.80
17,964.80
17,964.80
14,022.40
23,564.80
27,820.80
27,820.80
27,820.80
Base case
17,696.00
12,499.20
12,902.40
17,651.20
22,937.60
Mitigation scenario
17,696.00
10,976.00
10,393.60
13,932.80
17,785.60
-
1,523.20
2,508.80
3,718.40
5,152.00
Base case
9150
11440
13450
15500
17720
Mitigation scenario
9150
10930
12600
14270
16000
-
510
850
1230
1720
Total LPG imports (PJ)
Difference Electricity generation (GWh)
Difference
4.3.2. Mitigation costs The LEAP model allows calculation of costs for changing from the base case to the mitigation case, separated into three categories: demand (rural and urban) costs; transformation (electricity generation and distribution) costs; and import costs. Results for the case described above [Morales, 1997] are shown in Tables 13 and 14, for a 10 % discount rate. Differences in consumption between the two scenarios are mainly due to improvements in residential sector efficiency, which, in turn, result from investments in effi56
Energy for Sustainable Development
cient end-use equipment. On balance, however, increased costs in the demand sector are offset by reductions in transformation sectors, enabled by improved efficiency. Lower electricity and LPG requirements allow for reduction in operating and maintenance costs and even for postponing of new plant investments, as well as for reduction in LPG imports. 4.3.3. Emission reduction costs Table 15 shows calculated levelized costs (1995 US$) to reduce future emissions, through mitigation actions (energy efficiency, sources substitution), for a 10 % discount l
Volume V No. 3
l
September 2001
Articles
Table 13. Estimated costs, 2000-2025 (1995 US$ million) 2000
2005
2010
2015
2020
2025
Urban
-
16.38
22.57
30.71
49.46
62.32
Rural
-
5.32
6.90
8.79
14.55
17.82
Sub-total
-
21.70
29.47
39.50
64.01
80.14
Gen. + distr. (elect.)
-
(7.05)
(15.75)
(25.79)
(37.73)
(61.12)
Imports (petroleum)
-
(3.72)
(8.58)
(15.36)
(24.07)
(35.64)
Sub-total
-
(10.77)
(24.33)
(41.15)
(61.80)
(96.76)
Total costs
-
10.93
5.14
(1.65)
(2.21)
(16.62)
Demand
Supply/transformation
Table 14. Costs/benefits summary (US$ million) (discount rate: 10 %) Benefits (B)
Costs (C)
NPV
B/C
Demand Urban
0.64
132.35
(131.71)
Rural
1.27
41.93
(40.66)
Sub-total
1.91
174.28
(172.37)
Gen. + distr. (electricity)
83.89
-
83.89
Imports (petroleum)
47.13
-
47.13
Sub-total
131.02
-
130.99
Total costs
132.93
174.28
(41.38)
Supply/transformation
Table 15. Calculated costs for emission reduction
rate [UNEP, 1997]. Costs in terms of equivalent CO2 emissions are also shown. Emission reduction costs are strongly dependent on pollutant type. Very low costs are obtained, for example, for carbon dioxide and monoxide, because of the large amount of reductions obtained.
CO2 non-biogenic
5. Implementation of mitigation measures
CO2 biogenic
Pollutant
Technological solutions capable of controlling emissions exist, even though sometimes they carry high costs. These solutions are not applicable to Ecuador in the medium term. That is why energy efficiency programs assume great importance. The following considerations exclusively concern energy efficiency measures as a mitigation mechanism for greenhouse gas emissions. Imperfections of Ecuador’s energy market, besides failures of historically adopted political decisions, make up the background responsible for maintaining barriers opposed to energy efficiency and the substitution of energy sources in the country. Among the main obstacles are: lack of information, high initial cost of technologies, poverty and economic constraints of population, inadequate subsidies (promoting waste of energy and obstructing Energy for Sustainable Development
0.7626
Reduction average (kt/yr) 119.48
0.03
1013.84
0.00
104.81
0.04
Hydrocarbons
1.15
3.45
CH4
0.22
20.00
NOx
0.20
19.39
SOx
0.11
30.00
SO2
0.03
124.81
11.32
0.35
192.33 (kt/yr)
20.63 (US$ 1995/t)
CO
Particulate matter Equivalent CO2
l
Levelized emission reduction costs (US$1995 /kg)
Volume V No. 3
l
September 2001
57
Articles
Table 16. Propositions for implementation of DSM/IRP programs Step
Objectives
Preparatory actions
Development of regulatory instruments
Design of DSM programs
Activities
Elimination of distortions
To define government’s role as regulator or manager/producer
To prepare the ideal atmosphere for the adoption of conservation measures
To evaluate and eliminate market and political distortions, consistent with required social protection policies
To prepare specific legislation for DSM implementation
To stimulate DSM programs
To apply DSM programs
Labeling programs
To develop pilot programs for realistic assessments
Energy audit programs Fund availability Technology transfer Table 17. Recommendations for implementation of DSM/IRP programs Barriers
Regulatory instruments
Sub-program examples
Solutions
Lack of information on energy sector performance
Incentivize least cost criterion for planning
Energy audits
Technology transfer and development
Lack of funds for DSM programs
Efficiency rules and standards
ESCOs implantation
Equipment replacement
Too high initial investment costs
Performance tests
Financing programs
Educational campaigns
Absence of efficient equipment in domestic market
Labeling
Load management
Other specific solutions applied case by case
Consumption habits
Environmental externalities accounting
Development of alternative energy programs
Economic uncertainties
formation of a competitive market) and, lastly, the lack of regulatory instruments to implement energy efficiency. Implementation and development of energy efficiency programs must aim at market transformation and should be preferably inserted in an integrated resource planning (IRP) context. The following steps should be pursued: • a preparatory process of consideration and adjustment of the government’s role, distinguishing its double role as manager/producer and regulator/provider, concretized by formulation of a consistent set of policies; • development of an adequate regulatory framework with clear rules and mechanisms to guide implementation of DSM programs; and • implementation of demand-side management programs, including formulation of rules and innovative financing mechanisms to promote new investments in the sector. Tables 16 and 17 summarize some propositions and recommendations to implement DSM programs in an IRP framework in Ecuador.
energy conservation programs, deployment of efficient technologies and enhanced use of alternative/renewable energy sources. Implementation of evaluated measures could result in a 6 % reduction of global energy demand for the country and a much higher impact on individual sources or sectors. Minimizing biomass consumption, through efficiency improvement and substitution by LPG, will avoid emissions and may avoid net greenhouse emissions. However, further research on the whole carbon cycle associated with firewood supply to the residential sector is required, to adequately evaluate the degree of process sustainability. Results of this work warrant the formulation of policies to stimulate and indeed to implement programs and actions of DSM. Nevertheless, it seems that the most difficult obstacle to reaching this goal is lack of information at the governmental and individual levels. Dissemination of knowledge and information seems to be essential. Alvaro Cesar Morales can be contacted at: E-mail: [email protected] Ildo Luis Sauer can be contacted at: Phone: +55 11 818 4912 Fax: + 55 11 816 7828, E-mail: [email protected]
6. Conclusions There is a great potential for reducing fuel demand in the residential sector of Ecuador and, consequently, greenhouse gas emissions, which may be pursued through 58
Energy for Sustainable Development
l
Volume V No. 3
l
September 2001
Articles
Assessment Working Group of the IPCC, United Nations Environment Programme, Washington, USA.
Note 1. While pursuing a Master’s degree program at USP, the first author was supported by a fellowship from International Energy Initiative (IEI).
Ministerio de Energía y Minas (MEM), Petroecuador, 1972. Estadísticas Hidrocarburíferas, Quito.
References
Ministerio de Energía y Minas (MEM), 1996. Balance Energético Nacional 1995, Quito.
Fundación Ecuatoriana de Estudios Energeticos y Medioambientales (FEDEMA), 1996. Estudio sobre Políticas Energéticas del Ecuador, Quito.
Ministerio de Energía y Minas -- Dirección de Energías Alternativas (MEM - DEA), 1997. Inventario de Gases de Efecto Invernadero: Caso Ecuador, USCSP, Quito (preliminary).
Geller, H., 1991. Efficient Electricity Use: A Development Strategy for Brazil, American Council for an Energy Efficient Economy, Washington.
Morales, A., 1997. A Mitigação de Gases de Efeito Estufa Associados ao Consumo Energético do Equador: O Caso do Setor Residencial, Dissertação de Mestrado, Universidade de São Paulo, Programa Interunidades de Pós Graduação em Energia, São Paulo, Brazil.
Instituto Latinoamericano de Investigaciones Sociales (ILDIS), 1996. Projeções da População do Ecuador, BCE, Quito.
Petroecuador, 1995. Ley Reformatoria a la Ley de Hidrocarburos, Quito.
Instituto Nacional de Estadísticas y Censos (INEC), 1992. Resultados del Censo de Población y Vivienda de 1990, Quito.
Stockholm Environment Institute (SEI), 1995. LEAP User Guide for Version 95, Boston Center, Tellus Institute, Boston, USA.
Instituto Ecuatoriano de Electrificación (INECEL), 1994. Estudio Previo a la Implantación del Programa de Administración de la Demanda y Uso Racional de la Energía Eléctrica en el Ecuador, Quito.
United Nations Environment Programme Collaborating Centre on Energy and Environment (UNEP), 1997. The Economics of Greenhouse Gas Limitation Guidelines, Riso National Laboratory, Denmark.
Intergovernmental Panel on Climate Change (IPCC), 1995. The 1994 Report of the Scientific
As regular readers are aware, Energy for Sustainable Development has published special issues on several subjects during 2000 and 2001. More special issues are planned on the following subjects: ¤
The WGES energy perspective for China
¤
Sri Lanka
¤
Energy efficiency
¤
New technologies
These special issues will be produced during 2001 and 2002. The special issue on the WGES energy perspective for China is our next issue.
Energy for Sustainable Development
l
Volume V No. 3
l
September 2001
59