1. International Workshop on Energy Statistics Baku, Azerbaijan, 27-30 September 2011 Experience of Azerbaijan on compilation of the Energy Balance Rauf Gurbanov, Deputy Head of department of Fuel-energy and material balances statistics of State Statistical Committee of the Republic of Azerbaijan raufg@azstat.org 29 September 2011 1

2. Previous structure of Energy Balance ItemBalance items 1.Resources 1.1 Extraction (production) 1.2 Import 1.3 Stock at the beginning of year 2.Distribution 2.1 Consumption inside of the country including: 2.1.1 conversion into other type of energy 2.1.2 production–technological and other needs 2.2 Losses 2.3 Export 2.4 Stock at the end of year 29 September 2011 12 rows 2

3. Example previous Energy Balance with data 5.21 Fuel-energy balances in 2006 (thousand ton conditional fuel) Fuel- energy resources- total Natural fuel Other kind of fuel- energy resources total including: crude oil, including gas condensate natural gas other Resources76 64360 73346 98113 7203215 910 Stock to the beginning of the year2 5931 8428389977751 Production (extraction)68 48353 74546 1437 5831914 738 Import5 5675 146 -5 1406421 Divided76 64360 73346 98113 7203215 910 Domestic сonsumption32 78622 47510 79911 6542210 311 conversion of energy (electricity and heating)7 9936 058 - -1 935 as raw material11 89911 08210 705377 -817 other needs12 8945 335945 219227 559 Losses1 413934219715 -479 Export40 05435 56835 49375 -4 486 Stock to the end of the year2 3901 7564701 27610634 29 September 2011 3

4. Shortages of previous Energy Balance Having no analog in the international sphere; Absent of transformation sector, re-accounting of data; Non-application of consumption principles on several consumption groups; Non-coverage of all energy products Absent of commodity balance conversion factors (TOE) applied in international practice; Non-calculation of “statistical difference” indicator characterizing energy balance data quality; Data flows, but not energy flows. 29 September 2011 4

5. Learning of structure of balance of IEA and Eurostat (2006-2007) Creating of model of energy balance on the base of Eurostat ( February, 2007) Agreement structure of balance with all relation government organization (December, 2007) Submitted to Cabinet Ministries (December, 2007) Reference from IEA, seminars, discussion, creating of working group (2007-2008) Steps for creating structure of National Energy Balance 5

6. Methodological basis of Energy Balance: İnternational: Energy Statistics Manual. OECD/IEA, 2004; Methodological documents attached to questionnaire received from Eurostat, IEA, JODI and other international organizations; International Recommendations for Energy Statistics. UN New York, 2011; etc. National: Methodological recommendation on energy statistics (2008); Methodological recommendation on indicators system and calculation of the indicators (2009,2010); Methodological explanations on compilation of energy and commodity balances (2008, 2010) National conversion factors (2008) Classification of energy products (2011) etc. 29 September 2011 6

7. Purpose of energy balance (1) Main purposes on working out of energy balance: To achieve more transparency and effectiveness of energy sector applying international statistics standards in the country; To determine the development trends of energy sector to make statistical application and analysis of changes and inclinations taken place in production and consumption structure of energy products; To provide the country government with essential statistical information on compilation of national Energy balance, making decisions on energy fields for the next years. 29 September 2011 7

8. Purpose of energy balance (2) Moreover, the energy balance is a multipurpose tool to: Enhance the relevance of energy statistics by providing comprehensive and reconciled data on the energy situation on a national territory basis; Provide comprehensive information on the energy supply and demand on the national territory in order to understand the energy security situation, the effective functioning of energy markets and other relevant policy goals, as well as to formulate energy policies; Serve as a quality tool to ensure completeness, consistency and comparability of basic statistics; Ensure comparability between different reference periods and between different countries; Provide data for estimation of CO 2 emissions with respect to national territory; Provide the basis for indicators of the energy’s role in the country’s economy; Calculate efficiencies of transformation processes occurring in the country (e.g., refining, electricity production by combustion of fuels, etc.); Calculate the relative shares of the supply/consumption of various products (including renewable versus non-renewable) of the country’s total supply/consumption; Provide an input for modeling and forecasting. 29 September 2011 8

9. Structural divisions taken part in compilation of Energy balance in the State Statistical Committee Working group of development of Energy Statistics in SSC (methodological recomendations and quality control) Department of Industry, transport and communication statistics (Production and transfer of energy products) Department of Fuel-energy and material balances statistics (Transformation and communication of energy products) and COMPILATION ENERGY BALANCE Department of Trade statistics (Import and export) 29 September 2011 9

10. National conversion factors №Kind of energy products Net Calorific Values (Gj/metric tons) By AzerbaijanBy world Lower Upper Lower Upper 1.Crude oil 43,145,340,144,8 2.Gasoline 43,246,342,544,8 3.Aviation gasoline 43,446,542,544,8 4.Jet fuel 43,246,242,044,8 5.Diesel oil 42,745,541,443,3 6.Kerosene 43,146,142,445,0 7.Fuel oil (low-sulphur) 42,545,439,841,7 8.Fuel oil (high-sulphur) 41,243,839,841,7 9.Natural gas (cubic meter)35,938,938,936,039,02 10.LPG47,452,444,852,2 Net Calorific Values for some energy products 29 September 2011 10

11. Questionnaires for formation of Energy Balance: 1.06-extractionData on extraction of crude oil and natural gas 2.2.6-TG hydroReport on work of hydro electric station 3.3.19-refineryData on production refinery oil products 4.4.35-productionData on production refinery qas products 5.5.5-energyData on input and transfer of oil and refinery oil products 6.6.1-balance (oil)Data on balance of crude oil 7.7.1-oil productsData on balance of oil products 8.8.4-energyData on consumption and transformation of oil products 9.9.9-energyData on resource of hydro and electrical energy 10.10.2-gasReceiving and distribution of natural gas 11.11.1-energy (household)Fuel and energy consumption of housholds 29 September 2011 11

12. Questionnaires for formation of Energy Balance: 29 September 2011 12 Production primary production petroleum and other secondary energy pro. 06-extraction; 6-TG hydro 19-refinery; 35-refinery Import-exportState Custom Committee 4-energy; 1-oil products International bunkers4-energy Stock changes4-energy, 1-refinery Transfers5-energy, 4-energy Transformation processes crude oil other energy products 1-balance (oil) 4-energy (II section) Energy industry own use4-enerji (III section) Losses crude oil natural gas electricity other energy products 1-balance (oil) 2-gas 9-energy 4-energy Final consumption* energy porposes non-energy porposes 4-energy (II section), 1-energy (household) 4-energy (II section)

13. Formation of Energy Balance Commodity balances Conversion factors Energy balance 29 September 2011 13

14. Structure of Energy Balance International standards – UNSD (previous Eurostat model) Coverage of basic energy products (23 types and 5 groups of products) – 28 columns Motion of products from energy formation to final consumption (50 rows) – “Top block” Energy supply (8 rows) – “Middle block” Transfers, energy transformation, energy industry own use – and losses (12 rows) – “Bottom block” Final consumption (29 rows) – “Statistical differences” (in 2 row) 29 September 2011 14

15. Energy Balance of Azerbaijan (flows) “Top block”- Energy supply BC Primary production 1.1 Imports 1.2 Exports 1.3 International Bunkers 1.4 International marine bunkers 1.4.1 International aviation bunkers 1.4.2 Stock changes (closing-opening stocks) 1.5 Total energy supply 1 8 rows 29 September 2011 15

16. Energy balance of Azerbaijan (flows) “The middle block”. Transfers 3 Transformation processes 4 Electricity plants 4.1 CHP plants 4.2 Heat plants 4.3 Gas works 4.4 Blast furnaces 4.5 Oil refineries 4.6 Petrochemical plants 4.7 Other transformation processes 4.8 Energy industries own use 5 Losses 6 12 rows 29 September 2011 16

17. Energy balance of Azerbaijan (flows) “The bottom block”. Final consumption Final consumption 7 Final energy consumption 7.1 Manufacturing, const. and non-fuel mining industries, Total 7.1.1 Iron and steel 7.1.1.1 Chemical and petrochemical 7.1.1.2 Non-ferrous metal 7.1.1.3 Non-metallic minerals 7.1.1.4 Transport equipment 7.1.1.5 Machinery 7.1.1.6 Mining and quarrying 7.1.1.7 Food and tobacco 7.1.1.8 Paper, pulp and print 7.1.1.9 Wood and wood products (Other than pulp and paper) 7.1.1.10 Textile and leather 7.1.1.11 Construction 7.1.1.12 Industries not elsewhere specified 7.1.1.13 Transport, total 7.1.2 Road 7.1.2.1 Rail 7.1.2.2 Domestic aviation 7.1.2.3 Domestic navigation 7.1.2.4 Pipeline transport 7.1.2.5 Transport not elsewhere specified 7.1.2.6 Other, total 7.1.3 Agriculture, forestry and fishing 7.1.3.1 Commerce and public services 7.1.3.2 Households 7.1.3.3 Not elsewhere –specified 7.1.3.4 Non-energy use7.2 29 rows 17

18. Energy balance of Azerbaijan (flows) “Statistical differences” In the energy balance, the statistical difference is the numerical difference between the total supply of a energy product and the total use of it. It is presented in line 2 of the energy balance. 29 September 2011 Total energy supply1 Statistical differences2 Transfers3 18

19. Products of Energy balance (columns) № Energy products, total Crude oil Natural bitumen and asphalt Refinery feedstock Oil products, total Natural gas Derived gas Total renew. Energy other fuels Derived heat Electrical energy (termal power stat.) BC12345-17181920-25262728 Primary production1.1 19

20. Further steps on improvement of Energy Balance: – To accept the new recommendations on the basis of International Recommendations for Energy Statistics which is considered as unique methodology on energy statistics; – To conduct the “sample survey on Energy consumption of natural persons (private owners)” for the purpose of indication of energy products consumed by natural persons by the sectors in final consumption sector of energy; – To prepare the methodological explanations on estimation of unobserved part in the sector of energy balance final consumption, as well as data on households and private owners; – To prepare new indicators by training of advanced experiences in energy statistics; – To prepare the methodological conception on the system of statistical processes management regarding to energy statistics and energy balance compilation; – To prepare the metadata system on reports applied in energy statistics; – To continue the constant improvement of data quality; – Etc. 20

21. International Workshop on Energy Statistics Baku, Azerbaijan, 27-30 September 2011 Thank you for attention! 29 September 2011 21