WORLD ENERGY OUTLOOK
Benefits of Renewables Come at a Cost Global renewable energy subsidies
EU and Japan) have adopted new energy efficiency measures over the last year. Progress towards their implementation is projected to contribute to a reduction in global energy intensity (energy consumption per unit of GDP) of 1.8% a year through to 2035 in the New Policies Scenario, a major improvement compared with only 0.5% per year over the last decade. Nonetheless, a significant
Renewable subsidies were $88 billion in 2011; over half the $4.8 trillion required to 2035 has been committed to existing projects or is needed to meet 2020 targets
Source: WEO 2012, IEA
of the resource base and concerns about the environmental impact of production. Public confidence can be underpinned by robust regulatory frameworks and exemplary industry performance. By bolstering and diversifying sources of supply, tempering demand for imports (as in China) and fostering the emergence of new exporting countries (as in the US), unconventional gas can accelerate movement towards more diversified trade flows, putting pressure on conventional gas suppliers and on traditional oil-linked pricing mechanisms for gas.
Energy Efficiency: Six Steps Toward a Hat-trick of Goals Energy efficiency can improve energy security,
spur economic growth and mitigate pollution, but current and planned efforts fall well short of tapping its full economic potential. A number of major energy consuming countries (China, US, the
Energy Efficiency Brings Economic Gains Energy expenditure in 2035 compared with 2010
share of the economic potential of energy efficiency – four-fifths in the buildings sector and more than half in industry – remains untapped, mostly due to non-technical barriers.
Our Efficient World Scenario offers a blueprint to
realise the economically viable potential of energy efficiency. We set out the policies that governments would need to enact to lower market barriers, thereby minimising transaction costs and enabling the necessary energy efficiency investments to move ahead. Those investments pay back well before the end of the lifetime of the energy capital stock and result in a hat-trick of goals in terms of economic gains, energy security improvements and environmental protection.
The Efficient World Scenario sees a more efficient
allocation of resources, boosting cumulative global economic output through 2035 by $18 trillion. This is equivalent to the current GDP of the United States, Canada, Mexico and Chile combined. GDP gains in 2035 are greatest in India (3.0%), China (2.1%), the United States (1.7%) and OECD Europe (1.1%). Additional investment of
$11.8 trillion in efficient end-use technologies is more than offset by a $17.5 trillion reduction in fuel bills and a $5.9 trillion cut to supply side investment.
Source: WEO 2012, IEA In addition to cutting energy expenditures by an average of 20%, improved efficiency
84 December 2012 brings wider economic gains, particularly for India, China, the United States & Europe
Growth in global primary energy demand is halved: in the Efficient World Scenario, relative to the New Policies Scenario, and energy intensity improves at 2.6 times the rate of the last 25 years. Oil demand peaks at 91 mb/d before 2020 and declines to 87 mb/d in 2035, 12.7 mb/d lower than in the
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