21st Century Business Herald reporter Hu Huiyin reported
The heat wave in recent days has made the power shortage problem in many Asian countries more prominent.
On July 11, the Japan Meteorological Agency said that the Japanese archipelago was affected by the "snake line" of the westerly wind, and there were rare heats in late June where temperatures continued to exceed 35 degrees Celsius. Although the heat has eased somewhat since then, it is likely that the effects of la Niña will lead to a resurgence of the heat and continue until September. It is reported that Japan launched a three-month national power-saving season on July 1, which is also the second time that Japan has launched this measure after seven years.
Hot weather exacerbates power shortages in countries. On July 7, South Korea's deputy energy minister, Park Il-Jun, said it was considering whether to resume operation of one or two closed coal-fired power plants to prevent a power shortage in August.
Since June, japan, South Korea, India, Pakistan and other Asian countries have experienced power crises. Behind the phenomenon of "electricity shortage" in many countries, the global "energy shortage" has attracted much attention. This year, many Asian countries have suffered from hot weather, such as the temperature in the center of Tokyo, Japan, once climbed to more than 36 degrees Celsius, 164 of South Korea's 178 regions issued reports of extreme heat, and India's highest temperature once reached nearly 50 degrees Celsius. The frequent occurrence of extreme weather has triggered a surge in global energy consumption, but the current global energy is still in the transition from fossil energy to clean energy.
At this juncture, Asian countries are caught in a dilemma, and many countries are turning their attention to nuclear energy construction. Wang Yongzhong, director of the International Commodities Research Office of the World Economic and Political Institute of the Chinese Academy of Social Sciences, said in an interview with the 21st Century Business Herald that in the pursuit of "carbon neutrality", the world, including Europe, is now encouraging the development of nuclear energy, nuclear energy will become a very important part of global energy, and it is expected that Southeast Asian countries will also increase their investment in the field of nuclear energy. But at the same time, he is worried about the ability of Southeast Asia to develop nuclear energy, "but for now, Southeast Asian countries do not have enough capacity to develop nuclear energy, because the development of nuclear energy requires international capital and technology." ”
So, what kind of energy shortages will Asian countries have to suffer before nuclear energy is built?
Why is the energy shortage crisis so difficult to solve?
At present, the heat wave is sweeping across many Asian countries. Problems such as "electricity shortage" and "oil shortage" are emerging one after another.
In Japan, for example, since the beginning of June, the country has suffered rare high temperatures, and the maximum temperature in many places has exceeded 35 degrees Celsius. According to data released by the Fire Department of Japan's Ministry of Internal Affairs and Communications, the number of people sent to the hospital for heat stroke in the country in June was 15,657, the first time since the statistics began in 2010 that the number exceeded 10,000, a record high. This result is that the country is experiencing a crisis of power supply shortages. Japanese media estimate that 37 million people in Japan will be affected by electricity restrictions, accounting for nearly 30% of the total population. In response, the Japanese government launched the "National Node Season" on July 1, calling on businesses and people to work together to save electricity over a three-month period, which is the second time in seven years that Japan has launched this measure.
South Korea also suffers from electricity problems. The South Korean government estimates that the maximum electricity consumption this summer has exceeded the same period in 2021, but the energy reserve fell to the lowest in recent years, about 5.2 GW, compared with 8.9 and 9.6 GW in 2020 and 2021, respectively.
"Hot summer weather and surges in electricity demand have exacerbated tensions in the global liquefied gas supply. The current power shortage in Japan and South Korea is also related to the sanctions of geopolitical conflicts to a certain extent. Wang Yongzhong told reporters that because these two countries mainly rely on fossil energy to generate electricity, such as coal, natural gas, etc., and the domestic fossil energy endowment is extremely short, most of them rely on imports.
Wang Yongzhong said that under the geopolitical conflict, Europe has urgently increased natural gas stocks in order to reduce its dependence on Russia's natural gas, resulting in a shortage of natural gas supply, and Japan and South Korea have participated in sanctions to reduce the amount of natural gas purchased from Russia. At the same time, in order to support Europe and earn the difference, Japan and South Korea have also resold some of the LNG purchased from the United States, Australia and other countries to Europe, resulting in lower natural gas imports than expected.
Compared with Japan and South Korea, the problem of "energy shortage" in countries in South Asia and Southeast Asia is more prominent, and some countries are also in a deep power outage crisis.
Some thai households have switched to honeycomb coal due to rising fuel prices, while Thai transport organizations have told the government that without subsidies, 80% of passenger vehicles could stop operating from July onwards; Pakistan's national electricity demand once reached 28,400 megawatts, exceeding its national electricity generation capacity of 21,000 megawatts, and the country's businesses and households experience at least eight hours of power outages a day; India is also in a coal inventory emergency, with nearly two-thirds of the country's state, and about 700 million people are without electricity for up to 10 hours a day.
"Emerging economies such as Southeast Asia and South Asia have increased the development of manufacturing industries and the explosive growth of electricity demand, reflecting the contradiction between the explosive growth of demand in the post-epidemic period far exceeding the growth of electricity supply." Wang Chengqiang, director of the New Era Futures Research Institute, told the 21st Century Business Herald that in this case, affected by the geopolitical crisis, these countries are facing the historically high cost of coal and natural gas, and the potential of power output will be limited.
Wang Yongzhong also analyzed that the power generation capacity of emerging economies in Southeast Asia and South Asia was relatively weak, and now coupled with the depreciation of their own currencies against the US dollar, these countries are also facing the problem of declining ability to purchase energy.
Struggling to cope with imported inflation
Due to the soaring prices of imported energy and other commodities, many Asian countries are suffering from the "energy shortage" while being "bent over" by imported inflation.
The data shows that inflation data rose in June across countries. South Korea's consumer price index rose 6 percent year-on-year that month, up from 5.4 percent last month, the highest annualized level of South Korea's CPI since November 1998; Thailand's CPI value was 107.58, up 7.66% year-on-year; Inflation in Laos rose 23.6% year-on-year, a 22-year high; In addition, Pakistan's inflation rate reached 21.32%, the highest level in 13 years.
Energy has become the "culprit" of the rising burden of people's living costs. In order to alleviate the pressure on the people, many Asian countries have invariably sacrificed different subsidy policies, such as fuel subsidies and reductions in fuel taxes. Even with measures, inflation, which has not stopped rising, remains a psychological problem for all countries.
Wang Chengqiang believes that this round of inflation is the result of the combination of the epidemic, monetary easing policies and the geopolitical situation in Russia and Ukraine, and the development of international trade de-globalization may make the long-term development of inflation a deep-rooted risk.
However, as international oil prices fall, imported inflation in Asian countries may be expected to ease. In this regard, Jinlianchuang crude oil analyst Han Zhengji told the 21st Century Economic Herald reporter that with the macro level recession and interest rate hikes to speed up the tightening of liquidity expectations, investors' bullish sentiment on the crude oil market gradually faded, and for Asian countries, because most countries are crude oil importers, oil prices are conducive to reducing import costs, especially with the current refinery profits decreased, oil prices fell back to help stimulate demand growth.
However, Han Zhengji believes that the crude oil market still has tight supply concerns in the short term to hedge some bearish effects, so the overall oil price will remain volatile. As of July 9, international crude oil prices have recovered somewhat, with WTI crude oil futures up 2.06% to close at $104.844 / barrel; Brent crude futures rose 2.42 percent to close at $107.182 a barrel.
While crude oil prices have recovered, natural gas and coal prices are still climbing. Among them, as of July 8, the price of Newcastle coal futures on the intercontinental exchange, which is the weather vane of Australian coal prices, reached $410 / ton.
In this regard, Wang Chengqiang believes that the prices of crude oil, natural gas, coal and other energy sources have strong and weak differences in the short-term and medium-term direction, but the long-term trend has synergistic resonance, "Affected by the geographical impact, international natural gas resources are particularly tight, and long-term prices remain high." The increase in the share of international coal in fossil energy power generation is a substitution effect on the demand for natural gas. ”
In its World Energy Investment Report 2022 (the "Report"), the International Energy Agency (IEA) said that global coal investment will grow against the trend in 2021 after a slow decline in previous years. Last year, about $105 billion was invested in the "coal supply chain," up 10 percent from 2020, mostly in emerging Asian economies. Nonetheless, this does not necessarily mean that these economies are "driving backwards" in the energy sector. The report also shows that the scale of clean energy investment this year is expected to continue the previous growth rate, and the investment amount will exceed 1.4 trillion US dollars, becoming the main force driving the growth of investment in the global energy sector.
The transition to nuclear energy is obstructive and long
After five years of denuclearization, South Korea began to prepare for the revival of the nuclear power industry. On July 5, South Korea's Ministry of Industry, Trade, And Resources announced plans to increase the share of nuclear power in South Korea's national energy mix to more than 30 percent by 2030, up from 27.4 percent in 2021. The department also announced the resumption of construction of two nuclear reactors. In addition to South Korea, Indonesia, Vietnam and the Philippines have all expressed since the end of May that they want to have nuclear power to meet growing energy demand and wean themselves off fossil fuels.
Speaking of the increase in the application of nuclear energy in Asian countries, Wang Yongzhong told reporters that this will be the future energy trend, "in the pursuit of 'carbon neutrality' background, now the world including Europe are encouraging the development of nuclear energy, nuclear energy will become a very important part of global energy, it is expected that Southeast Asian countries in the field of nuclear energy investment will also increase." However, he believes that many Southeast Asian countries do not have the international capital and technology needed to develop nuclear energy.
Fan Haonan, a nuclear energy researcher at Jinlianchuang, also told the 21st Century Business Herald that there are still shortcomings in the wide promotion of nuclear energy in Asian countries, "First of all, the current new energy industry cannot take the banner alone, and it is difficult to take into account the problems of 'energy security' and 'energy stability'; secondly, it takes time to replace the infrastructure that consumes fossil fuels." ”
Relying on nuclear power to achieve net zero emissions is still a long way to go. Recently, the International Energy Agency (IEA) pointed out in its report "Nuclear Power and Safe Energy Transition" that global nuclear power capacity needs to be doubled in the next three decades to achieve the dual goals of net zero carbon emissions and energy independence.
In addition, Fan Haonan believes that if Asian countries want to achieve new energy transformation, they also need to solve the following difficulties, "First, although the cost of clean energy development has gradually declined with technology research and development, compared with traditional energy, it is still at a high level, and it is necessary to further improve the economy of clean energy in the future, so that it has the ability to compete in the market, in order to truly realize the large-scale replacement of fossil energy by clean energy; Secondly, the world's energy to clean development, the importance of long-distance, large-scale allocation of electric energy will become more and more prominent, but the existing power allocation capacity is obviously insufficient, follow-up need to establish a clean energy-led, electricity-centric, higher voltage level, larger transmission capacity, longer distance global energy allocation network platform to meet the needs of large-scale and long-distance configuration of clean energy; In addition, whether it is traditional energy or new energy, there are problems of low utilization rate of resource development and low energy conversion efficiency in the development process, and it is necessary to greatly improve technology. ”
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