Energy Efficiency Policies in East Asia: Macroeconomic Implications and Interactions with Existing Climate Policies

Low-carbon, Sustainable Future in East Asia-Improving Energy System, Taxation and Policy Cooperation所収

Improvement in energy efficiency, by using less energy to provide the same level of economic output, is widely accepted as one of the most cost-effective means to reduce CO2 emissions. East Asian countries accounting for around 30% of the world’s energy-related CO2 emissions in 2010 have strengthened energy management and improved the energy efficiency by introducing various energy efficiency measures.
In this paper we assess how East Asia’s total energy requirements might be reduced through energy efficiency measures. In particular the focus is putting on the cases of China and Japan. The analysis is based on the E3ME-Asia model, which is used to examine the macroeconomic and environmental impacts of introducing additional energy efficiency targets and policies in East Asia.
For each energy-efficiency policy, two types of information are translated to modelling inputs. Firstly, the amount of energy saved by types of carriers and by energy users depending on the take up rates. Secondly, the associate investments or costs required to achieve the saving are included. The E3ME model solves all equations simultaneously which means it captures any rebound effects of energy efficiency policies. Moreover, the dynamic demand-driven nature of the model means it captures induced effects from energy efficiency investments and energy savings. Interactions with other climate policies such as CO2 reduction targets in the region are also considered in this modelling exercise.
The model results show that even limited additional energy efficiency measures can give the Chinese and Japanese economies a small boost through investments that would stimulate demand and create jobs. The energy efficiency measures can also help to reduce the countries’ reliance on fossil fuel imports and their exposure to international movements in energy prices.