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Jeju Forum Alumni Newsletter
Titles [Jeju Forum Alumni Newsletter] (No.6 | November 2017) Supergrid and New Green Opportunities in East Asia
Writer JPI  (admin)
2017-11-08 오후 1:42:48

Supergrid and New Green Opportunities in East Asia

 

 

The era of Supergrid is about to happen with electricity produced by the wind and solar power in Mongolia. This will connect China, Japan and Korea allowing them to share green energy. Stakeholders of those countries initiated a study on 2GW Electricity Grid and no technological problems have been found. Future tasks are to build business models along with the government. On the other hand, China is going to introduce Nationwide Cap-and-Trade system in 2017, while Korea has introduced it since 2015 and Japan at regional level long before. Will there be any chance for ‘carbon market linkage’ between the countries? Will there be new ‘Rapprochement’ in pursuit of those green cooperation in the East Asia?

 

 

The following are excerpts from the final report of the Jeju Forum 2017.

 

 

Chair

 

 

KIM Sang-Hyup Chairman, Coalition for Our Common Future

 

 

Presenter

 

 

CHO Hwan-Eik CEO, Korea Electric Power Corporation

 

 

​Robert STAVINS Albert Pratt Professor, Harvard University

 

 

Frank RIJSBERMAN Director-General, Global Green Growth Institute

 

 

Discussant

 

 

KIM Hong-Gyun Director, Korea Electric Power Corporation

 

 

Kilaparti RAMAKRISHNA Director, UN ESCAP

 

 
 

 

CHO Hwan-Eik  This is an overview of what South Korea has done to build a Northeast Asia supergrid so far. The proposed Northeast Asia supergrid is aimed at developing and sharing renewable energy as well as enhancing power system reliability. Unfortunately, renewable energy is distributed unevenly and concentrated in certain areas, and areas with rich renewable energy sources are not necessarily areas with the demand. The role of the Northeast Asia supergrid is to build a “Smart Energy Belt” in ways that make renewable energy sources storable, transportable and controllable by smart grids. The project has developed to such an extent that a Memorandum of Understanding on joint promotion of an interconnected electric power grid, spanning Northeast Asia, was signed in March last year, and a pilot project was initiated for the first time between Mongolia, China, Korea and Japan.

 

 

Jeju has the clean air, however such routine happiness from clean air will become less available. Fine dust is causing a serious problem in our neighbor, China. The energy companies should draw a new picture of power generation in line with the government’s policy to address the issue of resolving fine dust. The time has come for us to come up with ways to replace coal-fired power fundamentally, and hopefully together with fossil fuels.  

 

 

Frank RIJSBERMAN  Like all technologies across a rapidly competitive landscape, the speed of deployment and its cost are critical and major factors. The Asia supergrid was conceptualized to speed up the deployment of clean, safe and affordable renewable energy. The Asia supergrid attempts to pave the way for maximizing the use of renewable energy by taking advantage of diversity in loads and resources as well as increasing global access to reliable and sustainable energy for all by 2050. Plenty of renewable energy generation has been secured and is under development. Now the question is how to move the renewable energy throughout Asia. Asia represents about two-thirds of the total world population. Electricity generation by Japan, China, Korea and Russia represents 76 percent of Asia’s total, and similarly, electricity consumption by these four countries represents 77 percent of Asia’s total.
Simply put, Japan, China, Korea, and Russia together represent a vast majority of electricity generation and consumption in the most populated regions in the world. This can be interpreted as, if joining grids together in Northeast Asia is possible, then there is a possibility of joining grids together worldwide to solve global energy issues. The falling costs are paving the way to pervasive low cost local renewable energy, which some critics say makes a supergrid largely limited in its potential. But the idea of a supergrid is appealing because one can invest more highly in areas with the greatest and cheapest renewable energy potential without worrying about how to use it.

 

  

Although battery storage prices are dropping, the scope of energy bulk and transmission between current storage technologies and the conceptual supergrid is a different magnitude. The heaviest bulk energy storage systems, composed of pumped hydropower and compressed air mechanisms, and even hydrogen fuel cell technology are meant to handle loads approaching one gigawatt, whereas the supergrid concept means to sustain transmissions of up to ten gigawatts to distant high-demand areas. For some locales that lack clean energy resources, or with those that have a strong traditional transmission infrastructure, such as areas of predominant coal use, ultra-high voltage lines provide a good bridge technology, providing cheaper cleansourced electricity to meet demand, while incentivizing transition to a cleaner local energy mix. It is apparent as part of the discussion that a supergrid will offer countries like Korea and Japan cheaper and abundant clean energy from China and central Asia(Mongolia) as the international scope of the grid would enable transmission over, though cross-border, shorter distances. China has already laid down 75.5 billion dollars in new transmission lines as of 2015 to disburse these concentration resources, but a supergrid would enable the release of an immense amount of cheap clean energy within a vast region. Yet the medium and longer-term benefits of a regional supergrid will provide the backbone that accelerates a clean energy revolution.
In light of both its vast potential and possible shortfalls, the Global Green Growth Institute(GGGI)’s current support for the green growth cooperation among China, Korea and Japan focuses on systems and platforms that leverage and hope to accelerate the deployment of the supergrid. Our focus on linking Emissions Trading Systems(ETS) and finding green growth collaboration areas between these three countries relates strongly to the supergrid potential as an accelerating instrument. Green growth cooperation in Northeast Asia needs to center around keeping and accelerating the momentum of green growth domestically in light of the rapid changes in China and new opportunities through the One Belt, One Road initiative, while building on Japan’s commitments and technology. There are new opportunities, and the private sector is strong in Korea.  

 

 

Robert STAVINS  What are some of the possibilities for climate change policy linkage among China, Japan and Korea? A key challenge for the eventual success of the Paris Climate Accord is whether the agreement, with its Nationally Determined Contributions(NDCs) anchored in domestic political realities, can adequately address emissions with sufficient ambition? Are there ways to enable and facilitate increased ambition over time? One of the answers could be linking regional, national, and sub-national policies and connections among policy systems that allow emission reduction efforts to be redistributed across systems. Linkage is typically framed as between cap-and-trade systems, but regional, national, and sub-national policies are highly heterogeneous. Among the potential merits of linkage are the ability to achieve cost savings and improve the functioning of individual markets by reducing market power, reducing total price volatility and allowing for the United Nations Framework Convention on Climate Change(UNFCCC)’s principals of common but differentiated responsibilities. On the other hand, concerns include: distributional impacts within jurisdictions automatic propagation of some design elements and reduction of national autonomy.

 

 

The greatest challenge to linkage under the Paris Agreement is that the NDCs exhibit three types of heterogeneity. First, there are heterogeneous instruments, which include cap-and-trade systems, emission reduction credits, taxes, performance standards, and technology standards. Second, there are heterogeneous jurisdictions, including regional, national, and sub-national policies. Finally, there are heterogeneous NDCs targets that would include hard emissions caps, relative mass-based emissions caps such as relative to business-as-usual, rates based emissions caps, such as per unit of economic activity or per unit of output, and non-emissions caps such as penetration of renewable energy sources. Looking at one of the simplest examples of such multi-dimensional heterogeneity, we can think about linking two cap-and-trade systems, which are both at the national level, and both have NDCs in the form of mass-based caps. Even in such a case, linkage is fairly straightforward, but specific design elements can raise concerns, if not impediments to feasibility. 
What needed to be in the Paris Accord to facilitate linkage? And the first principle should be do no harm if it is poorly designed. The 2016 agreement could have inhibited effective linkage. Then what the Paris Accord needed to include is a statement that countries can achieve parts of their intended NDC targets by financing or otherwise facilitating actions in other jurisdictions.
What needed to be in the Paris Accord to facilitate linkage? And the first principle should be do no harm if it is poorly designed. The 2016 agreement could have inhibited effective linkage. Then what the Paris Accord needed to include is a statement that countries can achieve parts of their intended NDC targets by financing or otherwise facilitating actions in other jurisdictions.​

 

 

 

Policy Implications​

 

● Renewable energy matters much because it is distributed.

 

● A pilot project has recently been initiated for the first time between Mongolia, China, Korea and Japan to jointly develop the Northeast Asian Supergrid.

 

● It is about time that energy companies drew a new picture of power generation in line with the government’s policy towards green growth.

 

● Regional cooperation for green growth should center around keeping and accelerating the momentum of green growth domestically in light of the rapid change in China and new opportunities through the One Belt, One Road initiative while building on Japan’s commitments and technology.