World Energy Outlook: 2010
Global Energy to 2035 Recent policy moves a start, but much stronger action is needed to accelerate the transformation of the global energy system, says the IEA’s latest World Energy Outlook.
“THE COPENHAGEN ACCORD and the agreement among G20 countries to phase out subsidies are important steps forward. But, these moves still fall a very long way short of what is required to set us on the path to a truly sustainable energy system”, said Nobuo Tanaka, Executive Director of the International Energy Agency in London at the launch of the latest edition of the IEA’s annual World Energy Outlook (WEO-2010).
“The energy world is facing unprecedented
uncertainty,” Mr Tanaka said. The strength of the economic recovery holds the key to how energy markets will evolve over the next few years. But WEO-2010 demonstrates that it is what governments do, and how that action affects technology, the price of energy services and end- user behaviour, that will shape the future of energy in the longer term. “We need to use energy more efficiently and we need to wean ourselves off fossil fuels by adopting technologies that leave a much smaller carbon footprint.” The central scenario in this year’s Outlook – the
New Policies Scenario – takes account of the broad policy commitments and plans that have been announced by countries around the world. “We have taken governments at their word, in assuming that they will actually implement the policies and measures, albeit in a cautious manner, to ensure that the goals they have set are met,” said Tanaka. In that scenario, world primary energy demand increases by 36% between 2008 and 2035, or 1.2% per year on average. The assumed policies make a tangible difference to energy trends: demand grew by 2% per year over the previous 27-year period.
Non-OECD countries account for 93% of the projected increase in world primary energy demand
In the New Policies Scenario, Non-OECD countries account for 93% of the projected increase in world primary energy demand. China contributes 36% to the projected growth in global energy use. “It is hard to overstate the growing importance of China in global energy. How the country responds to the threats to global energy security and climate posed by rising fossil-fuel use will have far-reaching
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consequences for the rest of the world,” Tanaka added. China is at the forefront of efforts to increase the share of new low-carbon energy technologies, including alternative vehicles, which will help to drive down their costs through faster rates of technology learning and economies of scale, and boost their deployment worldwide. Globally, fossil fuels remain dominant over the
Outlook period in the New Policies Scenario, though their share of the overall energy mix falls in favour of renewable energy sources and nuclear power. Oil nonetheless remains the leading fuel in the energy mix by 2035, followed by coal. Of the three fossil fuels, gas consumption grows most rapidly, its share of total energy use almost reaching that of coal. The oil price is set to rise, reflecting the growing insensitivity of both demand and supply to price. In the New Policies Scenario, the average IEA crude oil price rises from just over US$60 in 2009 to US$113 per barrel (in year-2009 dollars) in 2035. Oil demand continues to grow steadily, reaching about 99 million barrels per day (mb/d) by 2035 — 15 mb/d higher than in 2009. OPEC countries account for a growing share of
global production, with the biggest increases coming from Saudi Arabia and Iraq. Production in and exports of oil (and gas) from the Caspian region also grow substantially (see page 34).
Emissions & Renewables “Renewable energy can play a central role in
reducing CO2 emissions and diversifying energy supplies, but only if strong and sustained support is made available,” Tanaka said. In the New Policies Scenario, government intervention in support of renewables (electricity from renewables and biofuels) increases from US$57 billion in 2009 to US$205 billion (in 2009 dollars) by 2035. The share of modern renewable energy sources, including sustainable hydro, wind, solar, geothermal, modern biomass and marine energy, in global primary energy use triples between 2008 and 2035 and their combined share in total primary energy demand increases from 7% to 14%. The energy trends envisioned in the New Policies
Scenario imply that national commitments to reduce GHG emissions, while expected to have some impact, are collectively inadequate to meet
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