A System Dynamics Vehicle Fleet Model for Forecasting Road Transport Energy Demand

1. AsiaPacificEnergyResearchCentre
A System Dynamics Vehicle Fleet Model for Forecasting
Road Transport Energy Demand
The ETSAP Workshop, 1-2 June 2015
Dusit Thani Hotel, Abu Dhabi
Atit Tippichai

2. ‹#›APERC AsiaPacificEnergyResearchCentre
• To present a vehicle fleet model which is
prepared for estimating energy demand in
road transport sector in APEC economies
Objective of the presentation

3. ‹#›APERC AsiaPacificEnergyResearchCentre
APERC -Asia Pacific Energy Research Centre
• Supports the energy activities of APEC with:
o Research, especially analysis of energy supply and
demand in the APEC Region;
o Cooperative programs to promote energy
efficiency, low-carbon energy supply and
emergency preparedness for energy security.
• Established in 1996 and funded by the Japanese
government, based in Tokyo.
• Currently has 30 staff members, including 16 visiting
researchers from major APEC economies.

4. ‹#›APERC AsiaPacificEnergyResearchCentre
APEC Energy Demand and Supply Outlook
• The “APERC Energy Demand and Supply Outlook”
is a priority task of APERC under the APEC Energy
Action Programme adopted by leaders in 1995.
• We try to facilitate APEC cooperation by providing:
o Useful reference work on energy in the APEC region.
o Useful suggestions and case studies to policymakers.
• The 5th edition of the ”APEC Energy Demand and
Supply Outlook” was published in February 2013.
(It is available on APERC website http://
aperc.ieej.or.jp/)

5. ‹#›APERC AsiaPacificEnergyResearchCentre
(Source: www.apec.org)
Year of Joining:
"This map is for illustrative purposes and is without prejudice to the
status of or sovereignty over any territory covered by this map."
APEC’s Members

6. ‹#›APERC AsiaPacificEnergyResearchCentre
APERC’s Outlook Model Structure
KEY
ASSUMPTIONS
• Macroeconomic
Data
• Oil Prices
• Domestic Fossil
Fuel Production
• Biofuel Content of
Liquid Fuels
• Own-Use Rates
• Heat Production
Market Shares and
Efficiencies by Fuel
• CO2 Emission
Factors
Industrial and
Non-Energy Demand
Model
Transport Demand
Model
Other Sector
(Residential/Commercial /
Agricultural) Demand
Model
Electricity Supply Model
RESULTS
TABLES
• Macroeconomic
Data
• Energy
Production and
Imports
• Own Use and
Transformation
Losses
• Final Energy
Demand
• Energy
Intensities
• CO2 Emissions

7. ‹#›APERC AsiaPacificEnergyResearchCentre
Transport Sector Modelling Techniques
Transport
sub-sector
Sub-mode/
vehicle class
APEC Energy Demand in 2011
(Mtoe) (Percent)
Model
Domestic
Road
Transport
- Light and Heavy
vehicles
- Motorcycles
1,053 73% Bottom-up
(Fleet Model)
Domestic
Non-Road
Transport
- Rail
- Pipeline
- Water
- Air
- Non-specific
37
53
33
80
6
3%
4%
2%
6%
0.4%
Top-down
(Econometric Model)
International
Non-Road
Transport
- Maritime
- Aviation
109
78
8%
5%
Top-down
(Econometric Model)

8. ‹#›APERC AsiaPacificEnergyResearchCentre
APERC’s Vehicle Fleet Model
▪ Vehicle ownership model -> vehicle stock
(GDP per capita, vehicle saturation, total vehicle
population, income elasticity, urban density)
▪ Vehicle stock turnover model -> vehicle sales and
vehicle retirement
(vehicle population by type and vehicle distribution by
age)
▪ Vehicle consumer choice model -> share of
vehicle technologies
(fuel cost, purchase prices, driving range, refueling
infrastructure, etc..)
▪ Vehicle travel model -> travel distance
(fuel cost, income, vehicle ownership, efficiency
improvement, urban density)
❖ Macroeconomic data
✓ GDP & Population
✓ Crude oil price
✓ Urbanisation
❖ Vehicle data
✓ Vehicle population
✓ Vehicle age distribution
✓ Vehicle sales
✓ Vehicle fuel economy
✓ Vehicle travel distance
❖ Energy data
✓ Retail fuel prices
✓ Blend ratio of biofuel
✓ IEA road energy use

9. ‹#›APERC AsiaPacificEnergyResearchCentre
Vehicle Ownership Model – Gompertz Function
tGDP
e
t eV
β
α
γ=
ownershipvehicleofsaturation=γ
populationVehicle=tV
tcoefficienshape=α
tcoefficienrate=β
PPP(real)GDP=tGDP
*Source - Dargay J, Gately D and Sommer M (2007)
Vehicle Ownership and Income Growth, Worldwide:
1960-2030.

10. ‹#›APERC AsiaPacificEnergyResearchCentre
Historical Vehicle Ownership Curve ofAPEC Economies
(Source: APERC, 2015)

11. ‹#›APERC AsiaPacificEnergyResearchCentre
Forecasted Vehicle Ownerships by Economy
(Source: APERC’s estimate)
Vehicle per 1,000 Population % Saturation Saturation
2012 2020 2030 2040 2012 2040
Canada 640 679 709 737 82.0 94.5 780
United States 771 820 834 846 88.7 97.3 870
Mexico 288 394 462 482 59.0 98.8 488
Peru 70 153 269 352 16.7 83.8 420
Chile 215 306 382 425 42.8 84.4 503
Russia 311 385 456 511 51.8 85.2 600
Korea 380 436 459 467 80.5 99.0 472
Japan 598 613 623 626 95.4 99.8 627
China 80 226 395 468 16.0 93.9 499
Chinese Taipei 309 313 316 317 96.6 99.2 320
Hong Kong 85 86 86 86 92.5 93.6 92
Singapore 157 165 167 168 92.4 98.6 170
Thailand 190 293 414 484 37.0 94.1 514
Malaysia 413 516 584 608 67.0 98.6 617
Indonesia 74 146 266 385 15.6 82.0 470
Philippines 34 70 177 308 8.4 75.1 410
Vietnam 16 31 77 179 3.6 38.9 460
Brunei Darussalam 357 418 418 419 85.0 99.7 420
Papua New Guinea 11 20 50 119 2.1 23.7 500
Australia 700 731 753 767 89.7 98.4 780
New Zealand 705 740 759 772 90.3 99.0 780
APEC 232 329 442 507 42.0 91.9 551

12. ‹#›APERC AsiaPacificEnergyResearchCentre
Vehicle Stock Turnover Model
Vehicle Sales t =
Expected Stock t – (Vehicle Stock t-1 – Vehicle Retirement )
Survivalrate
0%
25%
50%
75%
100%
Vehicle Age
Light vehicle survival rate data
Light vehicle survival probability by Weibull fnc
Light vehicle survival curve (input)
Vehicle survival curve
Surviving Stock
Distributionbyage
0%
2%
4%
6%
8%
Year
Heavy vehicle distribution data
Heavy vehicle distribution by Weibull fnc
Heavy vehicle age distribution (input)
Vehicle distribution by age

13. ‹#›APERC AsiaPacificEnergyResearchCentre
Vehicle Consumer Choice Model
Powertrain Technology Fuel Type
Internal Combustion Engine (ICE) Gasoline
Diesel
LPG
CNG
Hybrid Electric Vehicles (HEV) Gasoline/Diesel
Plug-in Hybrid Electric Vehicles (PHEV) Gasoline/Diesel
Electricity
Battery Electric Vehicles (BEV) Electricity
Fuel Cell Electric Vehicle (FCEV) Hydrogen
Market Share (S) =
Variable Coefficient
Fuel cost -1.066
Purchase price -2.327
Driving radius 0.382
CMDD 0.517
PLDD 0.997
Type of Vehicle Technology
β = vehicle choice coefficient
U = utility coefficient
i = vehicle technology
Note: Fuel cost (FC)
Purchase price (PP)
Driving radius (DR)
Convenient medium distance destinations (CMDD)
Possible long distance destinations (PLDD)
Logit vehicle choice coefficient (β)

14. ‹#›APERC AsiaPacificEnergyResearchCentre
Vehicle Travel Elasticity Model
Factors considered:
• fuel cost
• Income
• vehicle ownership
• efficiency improvement
• urban density
Travel distance t = Initial travel distance t0
x Factor change to base year βLR
x Travel distance change to base year ((β LR-βSR)/βLR)
Variable Short Run Long Run
Fuel Cost -17% -27%
GDP per Capita 7% 20%
Vehicles per Capita -10% -29%
ex. Short run (SR) and long run (LR) elasticity for light vehicle travel
Energy demand = Number of vehicles by technology type x Travel distance
x Fuel economy

15. ‹#›APERC AsiaPacificEnergyResearchCentre
Vehicle Stock by Region
(Source: APERC Analysis)
Vehicle Stock (million)
% CAGR
(2012-2040)
Additional
Vehicles
(2012-2040)
%
Share
2012 2020 2030 2040
China 106 313 551 640 6.6% 533 60.5%
US 253 274 300 323 0.9% 69 7.9%
Russia 45 54 62 67 1.4% 22 2.5%
Other NE Asia 102 106 107 103 0.0% 1 0.1%
Other Americas 61 85 107 120 2.5% 60 6.7%
Oceania 19 22 27 31 1.8% 12 1.4%
South East Asia 50 88 157 235 5.7% 185 21.0%
APEC 637 943 1,310 1,519 3.2% 882 100%
APEC to add nearly 900 million vehicles by 2040, nearly triple current levels.
China and SEA account for more than 80% of this increase

16. ‹#›APERC AsiaPacificEnergyResearchCentre
Vehicle Stock by Technology
Advanced vehicles are slowly introduced, but conventional cars continue to dominate.
(Source: APERC Analysis)

17. ‹#›APERC AsiaPacificEnergyResearchCentre
Road Transport Energy Demand
Light duty vehicles represent two-thirds of road energy consumption,
peaking in 2030 thanks to improvements in fuel economy. Heavy vehicles
show the largest growth rates as demand for materials continue to rise.
(Source: APERC Analysis)

18. ‹#›APERC AsiaPacificEnergyResearchCentre
Regional Changes in Transport Energy Demand
Transport energy demand rises sharply in China and South East Asia, while declining trends are seen
in US, Russia and Other North East Asia thanks to slowing economic growth and tighter fuel efficiency
(Source: APERC Analysis)

19. ‹#›APERC AsiaPacificEnergyResearchCentre
Fuel use in Transport
(Source: APERC Analysis)
Oil remains the fuel of choice in the transport sector

20. ‹#›APERC AsiaPacificEnergyResearchCentre
• More than 80% of new vehicles added in APEC are in
China and South East Asia. Fuel efficiency an urgent
priority.
• Advanced vehicles are slowly introduced. Faster
penetration is needed.
• Heavy vehicles will be more significant share of energy
demand. Fuel economy standards for heavy vehicles
and mode shift to high efficient modes are
• Transport sector still relies very much on fossil oil.
Development of alternative fuels is needed more
efforts.
Key Messages from the Results

21. ‹#›APERC AsiaPacificEnergyResearchCentre
• The vehicle fleet model could deal very well with
vehicle stock changes and penetrations of
advanced vehicles.
• The model is also suitable for evaluating policy
and measures to introduce fuel economy standard
and promoting high efficient technologies.
• This model is based on vehicle unit. Need more
development to link with passengers and tons of
goods unit that will be able to deal with mode shift
policy.
Conclusion Remarks

22. ‹#›APERC AsiaPacificEnergyResearchCentre
Thank you
atit.tippichai@aperc.ieej.or.jp

23. AsiaPacificEnergyResearchCentre
Appendix

24. ‹#›APERC AsiaPacificEnergyResearchCentre
Historical and Forecasted Population by Economy
Population (million) AAGR (%)
1990 2000 2010 2012 2020 2030 2040 1990-2012 2012-2040
Australia 17.10 19.16 22.27 22.92 26.04 30.11 33.92 1.34 1.41
Brunei Darussalam 0.25 0.33 0.40 0.41 0.47 0.52 0.57 2.27 1.15
Canada 27.70 30.67 34.02 34.67 37.16 39.85 41.88 1.03 0.68
Chile 13.19 15.42 17.11 17.42 18.54 19.54 20.02 1.27 0.50
China 1,145.20 1,269.12 1,341.34 1,353.60 1,387.79 1,393.08 1,360.91 0.76 0.02
Chinese Taipei 20.40 22.28 23.16 23.32 23.61 23.57 22.71 0.61 -0.09
Hong Kong 5.79 6.78 7.05 7.20 7.80 8.48 8.95 0.99 0.78
Indonesia 184.35 213.40 239.87 244.77 262.57 279.66 290.22 1.30 0.61
Japan 122.25 125.72 126.54 126.43 124.80 120.22 114.34 0.15 -0.36
Korea 42.98 45.99 48.18 48.59 49.81 50.34 49.35 0.56 0.06
Malaysia 18.21 23.41 28.40 29.32 32.99 37.27 40.80 2.19 1.19
Mexico 84.31 99.96 113.42 116.15 125.93 135.40 141.52 1.47 0.71
New Zealand 3.40 3.86 4.37 4.46 4.82 5.21 5.48 1.25 0.74
Papua New Guinea 4.16 5.38 6.86 7.17 8.46 10.18 11.92 2.51 1.83
Peru 21.69 25.86 29.08 29.73 32.43 35.49 37.67 1.45 0.85
Philippines 61.63 77.31 93.26 96.47 109.74 126.32 141.68 2.06 1.38
Russia 148.24 146.76 142.96 142.70 141.02 136.43 131.28 -0.17 -0.30
Singapore 3.02 3.92 5.09 5.26 5.60 5.98 6.14 2.56 0.56
Thailand 57.07 63.16 69.12 69.89 72.09 73.32 72.99 0.93 0.16
United States 253.34 282.50 310.38 315.79 337.10 361.68 383.46 1.01 0.70
Vietnam 67.10 78.76 87.85 89.73 96.36 101.48 104.05 1.33 0.53
APEC 2,301 2,560 2,751 2,786 2,905 2,994 3,020 0.87 0.29

25. ‹#›APERC AsiaPacificEnergyResearchCentre
Historical and Forecasted by Economy
Real GDP in USD 2012 PPP (billion) CAGR (%)
1990 2000 2010 2012 2020 2030 2040 1990-2012 2012-2040
Australia 467.4 645.8 879.7 931.7 1,179.0 1,552.6 2,008.3 3.18 2.78
Brunei Darussalam 14.2 17.8 20.6 21.7 22.5 25.4 29.1 1.93 1.06
Canada 856.9 1,135.9 1,376.8 1,432.0 1,673.5 1,962.5 2,300.2 2.36 1.71
Chile 104.1 193.4 282.1 314.6 427.5 558.5 663.5 5.16 2.70
China 1,437.7 3,864.1 10,444.3 12,282.3 21,786.1 35,126.5 48,184.3 10.24 5.00
Chinese Taipei 319.9 584.6 852.6 923.9 1,053.8 1,172.3 1,201.0 4.94 0.94
Hong Kong 158.8 234.5 344.9 367.6 418.0 447.5 474.1 3.89 0.91
Indonesia 436.1 652.5 1,060.5 1,193.8 1,756.1 2,699.8 4,065.9 4.68 4.47
Japan 3,700.9 4,145.7 4,481.8 4,532.1 4,994.3 5,679.2 6,245.8 0.93 1.15
Korea 528.9 971.9 1,493.4 1,578.2 2,043.2 2,559.2 2,995.1 5.09 2.31
Malaysia 142.9 283.8 447.4 496.4 725.0 1,097.6 1,549.6 5.82 4.15
Mexico 941.0 1,314.6 1,568.4 1,695.0 2,255.4 3,106.9 4,026.8 2.71 3.14
New Zealand 74.2 98.6 127.2 134.3 157.2 193.2 240.1 2.73 2.10
Papua New Guinea 8.0 12.0 17.4 20.4 32.3 59.9 105.1 4.35 6.02
Peru 110.7 162.1 278.6 313.6 478.9 731.5 1,025.8 4.85 4.32
Philippines 178.6 237.0 378.3 418.6 662.7 1,230.5 2,143.2 3.95 6.01
Russia 2,135.9 1,439.5 2,313.6 2,476.9 2,850.0 3,271.9 3,696.2 0.68 1.44
Singapore 86.6 169.4 306.6 329.1 401.5 467.4 504.2 6.26 1.54
Thailand 258.5 401.4 630.2 682.7 925.8 1,322.7 1,826.5 4.51 3.58
United States 9,147.4 12,668.6 14,945.1 15,578.1 17,671.8 20,800.5 24,600.7 2.45 1.65
Vietnam 71.3 147.7 279.0 312.0 456.1 733.7 1,154.9 6.94 4.78
APEC 21,180 29,381 42,528 46,035 61,971 84,799 109,041 3.59 3.13

26. ‹#›APERC AsiaPacificEnergyResearchCentre
Projected World Oil Price
(Source: IEEJ’s estimates)

27. ‹#›APERC AsiaPacificEnergyResearchCentre
Final Energy Demand in Transport
Road accounts for nearly 90% of domestic transport energy demand
(Source: APERC Analysis)

28. ‹#›APERC AsiaPacificEnergyResearchCentre
CO2 Emissions from Road Transport by Region
(Source: APERC Analysis)

29. ‹#›APERC AsiaPacificEnergyResearchCentre
Scenario Overview - Transport
• Two scenarios of transport sector: Efficient vehicles and Efficient urban development.
• In the efficient vehicles scenario, the most important factor considered is the fuel
efficiency of the fleet. Global Fuel Efficiency Initiative (GFEI) data was used as a
reference to make efficiency gains assumptions as follows:
• New technologies such as electric vehicles also play a role in future energy demand.
The model provides estimates of penetration of these technologies and their impact.
Scenario Group of
economies
Fuel economy improvement (% per
year)2012-2030 2030-2040
BAU A 1.0% 1.0%
B 2.0% 1.0%
Alternative A 2.0% 2.0%
B 2.7% 2.0%
Group A is economy where vehicle fuel economy labelling and standard policy has not been currently
implemented, which include Brunei Darussalam, Indonesia, Malaysia, Mexico, PNG, Peru, Philippines,
Russia, Thailand
Group B is economy where vehicle fuel economy labelling and standard policy has been currently implemented,
which include Australia, Canada, Chile, China, Hong Kong, Japan, Korea, New Zealand, Singapore, US, Viet
Nam, Chinese Taipei

30. ‹#›APERC AsiaPacificEnergyResearchCentre
Scenario Overview - Transport
• Efficient urban planning scenario is under development. This scenario will
maintain a constant level of urban density, instead of declining at 1.7% per
year as the historical world average.

31. ‹#›APERC AsiaPacificEnergyResearchCentre
ShareofVehicleTechnology
Advanced vehicles also play a role in reducing energy demand in
transport, however their adoption remains low
(Source: APERC Analysis)