Agenda Item 4: Update on Collaboration with APEC Fora – EWG to Outline Areas of Potential Cooperation, including on Maritime Security Mr Koichi Murakami Economic Affairs Bureau Ministry of Foreign Affairs JAPAN

Established in 1990, the objective of the EWG is to maximise the energy sector's contribution to the economic and social well-being of the region, while minimising the environmental effects of energy supply and use. Australia holds the EWG Lead Shepherd and EWG Secretariat roles. The EWG is assisted by four Expert Groups on: Clean Fossil Energy;Clean Fossil Energy; Energy Efficiency & Conservation;Energy Efficiency & Conservation; Energy Data & Analysis;Energy Data & Analysis; New & Renewable Energy Technologies, and aNew & Renewable Energy Technologies, and a Task Force on Biofuels.Task Force on Biofuels. EWG Background Makati City The Philippines th APEC Transportation Working Group Meeting

APEC accounted for 59% of world energy demand in 2004 and is a net energy importer. Energy demand is growing due to high levels of economic growth, industrialisation and urbanisation. Energy security is vital to the ongoing economic prosperity of the APEC region. Energy Demand in the APEC Region Makati City The Philippines th APEC Transportation Working Group Meeting

Between 1980 and 2002 APEC's transport energy consumption grew at nearly 3% per annum. Oil products account for the largest share of transport energy consumption – 98% in 2002 and forecast to increase to 99% by APEC's transport energy demand will increase from 1087 mtoe in 2002 to 1991 mtoe in Energy Demand for Road Transport Makati City The Philippines th APEC Transportation Working Group Meeting

Due to a heavy reliance on road transport and limited potential for alternative fuels, the transport sector will continue to lead oil demand growth well into the future. Furthermore, with declining domestic oil production, increasing oil demand will be met through higher levels of oil imports, thus raising energy security concerns. Managing road transport energy demand will be a critical element in promoting regional energy security and sustainable development. Energy Demand for Road Transport Makati City The Philippines th APEC Transportation Working Group Meeting

EWG's Energy Security Initiative (ESI) In light of increasing regional energy demand from the transport and stationary sectors, promoting regional energy security is a major component of the EWG's policy work, primarily through the EWG's Energy Security Initiative (ESI). The ESI comprises: Short-term measures to respond to temporary energy supply disruptions; andShort-term measures to respond to temporary energy supply disruptions; and Longer-term measures to address the broader energy security challenges facing the APEC region.Longer-term measures to address the broader energy security challenges facing the APEC region. 30 th APEC Transportation Working Group Meeting Makati City The Philippines 2008

Short-term measures include: Improving transparency of the global oil market; Improving transparency of the global oil market; Maritime security; Maritime security; A real-time emergency information sharing system; A real-time emergency information sharing system; Encouraging APEC Economies to have energy emergency mechanisms in place. Encouraging APEC Economies to have energy emergency mechanisms in place. Long-term measures include: Facilitating energy trade and investment; Facilitating energy trade and investment; Technology cooperation, energy efficiency, clean fossil energy; Technology cooperation, energy efficiency, clean fossil energy; Alternative transportation fuels and new and renewable energy technologies. Alternative transportation fuels and new and renewable energy technologies. 30 th APEC Transportation Working Group Meeting Makati City The Philippines 2008 ESI Measures

APEC Biofuels Task Force The Biofuels Task Force aims to help APEC economies understand the potential for biofuels to displace oil in the transport sector. The Task Force reports that while several biofuel options are potentially cost competitive at oil prices above US$50/barrel, major process cost reductions are needed for ethanol to be economic. Much more work is needed at the R&D and production process level before biofuels could make a substantial contribution to enhancing energy security in the transport sector. Makati City The Philippines th APEC Transportation Working Group Meeting

Asia Pacific Energy Research Centre (APERC) APERC was established in 1996 and is based in Tokyo, Japan. APERC aims to foster understanding amongst APEC economies of global, regional and domestic energy demand and supply trends, including energy infrastructure development, energy regulatory reform and related policy issues. APERC's research themes are subject to EWG endorsement and it reports on its activities to EWG meetings. Makati City The Philippines th APEC Transportation Working Group Meeting

APERC – Research Activities 'Urban Transport Energy Use in the APEC Region – Trends and Options'. Published in 2007 and is available from: The report analysed the factors contributing to increasing urban transport energy demand and provided options to control transport energy demand in APEC urban areas via:  Mass transit systems;  Smartcard unified payment systems;  Pricing approaches to parking; and  Employer based incentives. Makati City The Philippines th APEC Transportation Working Group Meeting

Survey of Policies and Programs to Promote Fuel Efficient Transport in APEC Economies Provides a summary of options for improving transport efficiency, including energy efficiency in transport through:  Increasing fuel efficiency of new vehicles;  Increasing purchases of energy efficient vehicles;  Improving operational efficiency of existing vehicles;  Reducing traffic congestion;  Increased use mass transit systems; and  Improved urban planning to reduce traffic. On 25 March 2008, Transportation Working Group members were requested to provide a peer review of the survey and the EWG looks forward to receiving feedback on this document. Makati City The Philippines th APEC Transportation Working Group Meeting

Peer Review on Energy Efficiency (PREE) Initiative Makati City The Philippines th APEC Transportation Working Group Meeting The EWG endorsed the PREE initiative to advance regional energy efficiency. Improving energy efficiency can help lower business costs, mitigate greenhouse gas emissions and enhance energy security. Opportunities for energy efficiency improvements exist in the power generation, industrial public, residential, commercial and of course, transportation sectors. The two prime activities to be undertaken under the PREE initiative include:  Compiling energy efficiency policies of APEC member economies; and  On a voluntary basis, peer reviews of APEC member economies energy efficiency policies/programs. Final planning of the PREE process, including the sectors to be covered expected to be finalised in the second half of 2008.

8th Meeting of APEC Energy Ministers (EMM8) At EMM8 Energy Ministers noted the economic implications of disruptions to maritime security and instructed the EWG to develop linkages with organisations responsible for maritime security for reporting to EMM9. Energy Ministers also directed the EWG to develop best practice principles for energy efficient transport and encouraged APEC members to diversify the transport fuel mix using cleaner fuel sources. The preceding issues that I have discussed could potentially benefit from Transportation and EWG Working Group cooperation. Makati City The Philippines th APEC Transportation Working Group Meeting

EWG and Transportation Working Group Cooperation The EWG seeks to identify cross-cutting issues and potential areas of cooperation with the Transportation Working Group and its MSSG to further promote and enhance energy security in the APEC region. Makati City The Philippines th APEC Transportation Working Group Meeting Possible courses of action include: Attending each others meetings as appropriate;Attending each others meetings as appropriate; Share and exchange information on best practices and lessons learned on energy efficient transport and maritime security issues, including on maritime security capacity building needs;Share and exchange information on best practices and lessons learned on energy efficient transport and maritime security issues, including on maritime security capacity building needs; Cooperation on potential project proposals of direct relevance to both groups.Cooperation on potential project proposals of direct relevance to both groups.

LNG Facilities and Energy Efficient Transport Public information and education are important to the success of LNG projects and to the growth of LNG trade and energy security in the APEC region. However, public concern about the safety of LNG ships, terminals and storage facilities has surfaced on numerous occasions. These concerns require a response in the form of public education campaigns as they provide a valuable input to those involved in new LNG projects. The views of the MSSG for example would be most welcome in addressing such issues, as would the views of the Transportation Working Group on promoting best practice principles for energy efficient transport. Makati City The Philippines th APEC Transportation Working Group Meeting

EWG Project on LNG Public Education EWG Project - LNG Public Education, Communication and Information Sharing Campaign This project undertaken in response to public concerns about the safety aspects of LNG infrastructure facilities. The EWG could potentially benefit from MSSG advice and information sharing activities in this area. Makati City The Philippines th APEC Transportation Working Group Meeting

Conclusion APEC Energy Ministers directed the EWG to develop linkages with organisations responsible for maritime security and to develop best practices for energy efficient transport. Cooperation between our groups on best practices and lessons learned on maritime security issues and energy efficient transport could be undertaken through: Attending each others meetings as appropriate; Sharing and exchanging information on these issues; and Cooperating on potential project proposals of direct relevance to both groups. The EWG would welcome your views on these important issues. Makati City The Philippines th APEC Transportation Working Group Meeting

EWG Contacts EWG Secretariat Manager: Tel: Fax: Further information about the APEC EWG and the Energy Security Initiative can be accessed from: Makati City The Philippines th APEC Transportation Working Group Meeting

Thank you Thank you for you’re the opportunity to attend your meeting today. In working to advance energy security in our region, we look forward to hearing of the outcomes of your consideration on cooperation between our two groups. Makati City The Philippines th APEC Transportation Working Group Meeting